How do you make DVC make financial sense?

[SarahC97]

Hi all!

My husband and I are going to WDW in January and plan on doing the DVC tour. My husband has been very interested in it, but after doing some research he's decided that even though we'd pay cash for it, it's not really a wise investment.

We go to Disney about every other year with our two kids and want to continue to do that, but we don't do deluxe, mostly value (sometimes moderate). He's just not convinced it makes financial sense for us.

Any owners that have a similar travel style to us that have found it does make sense to buy in? I really want to try and come up with some counterpoints to his argument, so I'm just wondering if there's anything I'm overlooking that others have found to be an advantage of buying DVC. Thanks!

 

[crisi]

It isn't an investment. Its a value add. If you are happy with values, no it won't make financial sense.

I will even say that even if you took every trip in a Deluxe, there is no guarantee that you'd end up spending less. We spend way more with our DVC than when we took Deluxe trips because the way we stay changed. That doesn't mean we aren't happy with the purchase, but then we didn't buy with "savings" as the top priority.

 

[buzznina]

It isn't an investment. Its a value add. If you are happy with values, no it won't make financial sense.

I will even say that even if you took every trip in a Deluxe, there is no guarantee that you'd end up spending less. We spend way more with our DVC than when we took Deluxe trips because the way we stay changed. That doesn't mean we aren't happy with the purchase, but then we didn't buy with "savings" as the top priority.

I am soooo happy that you said this, I read so many posts that just skew the facts and make it sound like it's the greatest thing since sliced bread

 

[Disney Wish]

What an interesting question. WDW is our fav destination and I have been struggling with the same question. After spending a week at a DVC property this summer with friends who are members, we kicked it around. The rooms have balconies/walkouts which are great if you do want some quiet time outside. But, like your husband, I am not sure the financial commitment is worth it. I will be watching this thread now to see if I can be swayed

 

[SarahC97]

So, it's not something you do to save money, really? That's not the right way to look at it?

 

[skippytx]

So, it's not something you do to save money, really? That's not the right way to look at it?

crisi nailed most of it on the head. No, it's not something you do to save money. Sure in certain scenarios given certain variables you can come out ahead, but the strong consensus here is DVC members tend to spend MORE money at WDW than they did before.

We purchased DVC because we liked the upgraded accommodations and potential long term savings of DVC. We spent roughly 10K on hotel rooms/renting DVC points during our 2015 and 2016 trips to WDW. That's about half of what we paid for our DVC contract. With our continuing plans to keep visiting WDW, and the desire to stay in nicer rooms it made sense for use to spend a big chunk of change now and then only worry about annual dues. (Or at least we tricked ourselves into believing that). The fact DVC tends to hold a decent percentage of its value is nice as well. If we get tired of WDW some day we should be able to sell the contract without much trouble.

If you're an ever 2 year visitor that is fine staying at Pop or All stars (nothing wrong with those places, they're great!), you won't "save" money with DVC. In our case though we spent around 5500 dollars last year renting someone else's points so we could stay at Bay Lake, so buying our own started to make more sense.

 

[miTnosnhoJ]

DVC is basically a luxury purchase. I agree that we have enjoyed being DVC members, but we are probably spending 2 to 3 times what we were before. But we are also enjoying Disney more.

Rather than focus on cost savings, I would make sure everything else is in good shape before considering DVC.
1) You can pay cash.
2) You are on track to have a fully funded retirement.
3) You are on track to pay for college for the kiddies.
4) You have paid down all consumer debt except possibly your mortgage.
5) If you were to lose your job or have a financial setback, you have an emergency fund.

If you can answer yes to all this, then DVC is something you should consider as an alternative to buying a boat, a house in the mountains, or other luxury purchases that may interest you.

If you come every year and stay at deluxes, then there is some cost savings. If you only come every other year, the cost savings diminishes because of the time value of money. If you like mods or values, then there may be no cost savings for you.

 

[Cyberc1978]

For us the choice was simple as we like doing Disney and like the luxury of the deluxe resorts.

Even though we are from EU we normally go once or twice a year. When we go we have stayed in studios but we might upgrade to a 2br in the future or 2 x studios.

We expect to break even in 6 years from now. Might be sooner as we hope/plan to go to aulani in the next 3-4 years.

We haven’t stayed in moderates or values but reading previous threads draws a pictures of if you stay at moderates it might be worth it to buyin as values do not.

 

[DM3MD]

I'd say if you typically stay Deluxe, it's a money saver... if you typically stay Value, it's a vacation upgrader.

On the investment side of things, it can be a good place to store some funds and make them work for you (assuming no major negative market fluctuation)... we have around 200 points at AKV, SSR, and Poly... considering all have end dates at least 37 years away, we can easily see using this for 10-15 years (when the kids go to college) and still being able to resell the contracts and recoup most/all of our initial investment.

Dues still cost real money, so another option is to buy more than you need and rent out 40% of your points annually, which should net about enough to pay for dues on all the points.

 

[bumbershoot]

So, it's not something you do to save money, really? That's not the right way to look at it?

If dvc allows you to travel the way you have been traveling, it can be a savings.

If it allows you to travel the way you want to travel (that was our case) it can ultimately save money but at first it might be more.

If you're every other year and you stay value AND you are happy with it...might not be worth doing.

 

[LYSE]

Not an owner here but someone that has been keeping an eye on it and may be sometime in the next 2-5 years.

It doesn't make sense financially...it's not an investment, what it does do is allow you to buy into deluxe accommodations for (hopefully) cheaper, of course this is assuming habits don't change from what they are when you run your numbers...however if your not staying at deluxe and are trying to compare DVC to value stays it will never work...but then again it shouldn't since you really should be comparing deluxe pay as you go cash vs deluxe dvc.

 

[Ben E N]

I also used to always stay at value and the occasional moderate resort and loved it. Then, on a whim, I decided to rent a DVC room. The Deluxe hotels really do make a big difference, but it is a difference you do not even notice if you stay purely within the value/moderate resorts. My advice is to keep doing what you are doing, and to not stay at a deluxe resort or rent DVC points. You will cannot miss what you do not already experience, and the extra money savings you will notice.
This scenario gets compounded even further if those good neighbor hotels get the 60 day fastpass+ window. Then you can have nice accommodations for a cheaper price.

 

[DM3MD]

Side note, with the early reviews of the Pop Century room refurbs, I think the lines are getting even more blurred between the categories.

 

[Melissa Perez]

hi! just my two cents:
1. In my family's 23 years of having DVC, we have never had to stay using the dining plan. The use of the full kitchen was the site of many sandwich lunches before afternoons at the pool and continue to be where the whole family gathers for breakfast
2. As the family gets older, deluxe resorts do it bigger and it can become a different kind of vacation. My parents, now retirees, go to disney world to stay on property for a week and find it relaxing - dont even feel the need to go to the parks
3. Our family makes a point to go 3 - 4 times a year and once you've made the DVC jump it basically feels like the "land" portion of the vacation is already paid for
4. Concierge collection - we have been to hawaii 3x through banking 2 years of points; have also been to Vermont (the Equinox), DC (Mandarin Oriental)

 

[Lynne M]

So, it's not something you do to save money, really? That's not the right way to look at it?

DVC can save you money if you compare the cost to booking the exact same villas through Disney. And paying for DVC studios with points will generally cost you less over the length of the contract than booking a standard room at a deluxe resort.

It will be a significant cost increase over stays in a value resort.

Usually, people buy DVC because they need or want to upgrade their resort accommodations. They're tired of stuffing a growing family into a single hotel room, or they want the full kitchen and laundry facilities you get in a larger villa. Or they just want the luxury of having more space, with a master bedroom with a big bathroom and jetted tub and a living room. Or want to be able to take family or friends, and want 2 or 3 bedroom villas for that.

I was a little different than most, I think. I knew I'd want to go to WDW more often than my friends or family did, so I knew I'd be taking a bunch of solo trips. Paying for a deluxe room just for me wasn't justifiable to me, but I wasn't crazy about the moderates and values. DVC studios have been a good fit for me. I get the restaurants, pools and other amenities of a deluxe resort, and the proximity to theme parks, without the high cost of the deluxes.

DVC really is all about the villas. If you want the villa-style accommodations and you're willing to pay more for that, DVC is probably the most cost-effective way to make that happen. If you really don't care about the room, and see it just as a place to crash and shower after running around theme parks all day, it's probably not worth it for you.

 

[DougEMG]

I would say that it is impossible to save money on DVC when compared to a value resort. Compared to a moderate you will probably break even, but you will be in a nicer room/resort/location. The scenario where you save money is if you were a Deluxe resort person paying cash rates and now stay in a DVC studio, then you will save money.

As most have said here, and I think this applies to the majority of DVC owners, is that they end up spending more money at Disney, because or more trips and upgraded accomodations (deluxe resorts instead of values/moderates and 1 and 2 bedrooms units instead of hotel rooms).

 

[holden]

Prior to DVC, we always stayed at Poly. After years of vacations we decided to purchase DVC resale. We paid cash for 200pts at BLT and then added 200 more BTL points (also cash).

In the 5 years since we have been DVC members, we have visited WDW at least once a year and stayed in 1br, 2br and GV. I feel like we’ve recouped our initial cash layout though I haven’t done the math.

We don’t look at DVC as an investment, but I do feel we’ve gotten (and will continue to get) our money’s worth out of it.

 

[crisi]

So, it's not something you do to save money, really? That's not the right way to look at it?

For us, we spend a LOT more on Disney vacations - but we don't share a bedroom with the kids. We call it the "nookie tax." We spend a LOT more on Disney vacations, but we've been able to treat friends to a room and see Disney through the eyes of people who have never been. We spend a LOT more on Disney, but we moved the room cost to a big upfront payment, and smaller annual payments - which still exceed the cost of a value or offsite hotel room for the number of nights we go - which gives us cash flow to eat out at really nice places when we go. We spend a LOT more on Disney, but we have to use those points, which has meant some "enforced" vacation times for my workaholic husband. We spend a LOT more on Disney, but we have a room we can leisurely cook up omelettes in and still get to the parks for rope drop - and which we can pack in a carryon and easily do laundry.

 

[Cirlonde]

You're not the only one who really wishes she could be convinced that DVC made more financial sense. From an emotional standpoint, I really want to be a DVC member. Unfortunately, we can't make the math work out...no matter how many hoops I try to jump through. We're just not the right demographic...husband and wife, no kids, don't need a bigger room. But we love staying at deluxes. So instead, we rent points.

I think there are people out there who DVC does benefit and it's a great choice for them. I wish I was one of them!

 

[citivas]

Hi all!

My husband and I are going to WDW in January and plan on doing the DVC tour. My husband has been very interested in it, but after doing some research he's decided that even though we'd pay cash for it, it's not really a wise investment.

We go to Disney about every other year with our two kids and want to continue to do that, but we don't do deluxe, mostly value (sometimes moderate). He's just not convinced it makes financial sense for us.

Any owners that have a similar travel style to us that have found it does make sense to buy in? I really want to try and come up with some counterpoints to his argument, so I'm just wondering if there's anything I'm overlooking that others have found to be an advantage of buying DVC. Thanks!

If you really typically do Value resorts every other year or less I doubt it can make financial sense... We used to stay off-resort by renting at a Marriott time share place. It worked out to about $110/day for a 2 bedroom condo even larger than the Disney 2 bedroom villas. On that the cost for enough points to do the Disney 2 bedroom villas would never catch up with the investment cost, especially once you factored in the value of your money invested elsewhere over that time.

A couple years ago we splurged due to a gift and stayed at Bay Lake Tower. The experience of that proximity to the park changed our perspective and sadly we don't want to go back to the value options and we can afford not to. Using it as an example, if we add up the cost of buying our points and divide by the remaining years of the agreement then add the annual fees and an assumed a standard annual fee increase, then compare to the cost of paying by the week for the exact same room type and location, we break even after 5 trips before accounting for the investment value of the money (and if you otherwise would have had it in a savings account there would be virtually none). If you add in conservative investment value it takes a couple more trips. And all that is before dealing with the possible resale value of the shares. Right now resale prices are so high that some earlier investors can actually sell for a profit -- that won't always be the case.

But that assumes would would have stayed in a comparable accommodation and consistently gone every couple of years. Otherwise it doesn't work on a value basis.