Would you buy a resale with 2042 end date?

[CarolynFH]

The possibility of an extension at one of the 2042 Crescent Lake villas would be very enticing. If it's not going to happen, then maybe I go ahead and buy more points at RIV

I think this is the better plan, because I truly doubt an extension will be offered!

 

[EPCOT Terran]

I would expect RIV resale value (along with all of the other DVC resorts and especially the restricted ones) to be lower than they are now (at least in real dollars)

Yeah, maybe, but then I would have gotten 18 good years out of RIV and who knows if my kids/grandkids will like WDW as much as I and my wife do.

I appreciate the discussion!

 

[brettcw23]

When they've done this in the past, what was the extension premium? I assume it was lower than a new buy-in but have no experience with this.

In 2007 they offered extending for $25/point. $15 if it was done by a certain date. I have no idea how that would translate in today's dollars.

 

[dvc lover 1970]

I'd assume you'll have to wait another 2-3 years before we see this. Would 80 then be OK for you or will you be looking for 60 then? I wouldn't bet on a cliff and rather expect a 7-9 point drop per year (depending on the evolution of point rental prices and cash booking prices).

Not sure. We own at BCV, but I would not add on any more points there due to the 2042 date. Your right - in a few years - 80 would be too high for the years remaining in my opinion

 

[CarolynFH]

In 2007 they offered extending for $25/point. $15 if it was done by a certain date. I have no idea how that would translate in today's dollars.

$25 in 2007 would be over $38 today.

 

[brettcw23]

$25 in 2007 would be over $38 today.

~ $40/point to extend for 15 years doesn't sound bad at all. For some reason I thought it would translate into a much higher dollar value. But as folks have pointed out, not likely DVC offers extensions.

 

[jolynne28]

I think someone mentioned this earlier in the thread, but I’ll add it again anyway. We started with 150 SSR resale for SAP. Swore I’d never buy a 2042 resort. But started to crunch numbers and look at our travel patterns. Suddenly 50 pts at BWV became very appealing. We can get a standard studio for 5 nights once a year, and that makes the rate per night under $200 in today’s dollars over the next 18 yrs. I don’t think we can beat that, and if we outgrow 1 studio, we’ll either add on another small contract in a few years, or get one somewhere else to split stay with 2 studios a night.
Everyone gets hung up on the value being zero in 18 years, but those vacations will be a steal compared to rack rates and we aren’t locked into dues past that. Our youngest will be 23, we’ll still have SSR, and I think we’ll be that family that owns small contracts at 4-5 different resorts before we’re all done with DVC.

*editing to say that my math comes out to under $170/night.

 

[walt34]

Not sure. We own at BCV, but I would not add on any more points there due to the 2042 date. Your right - in a few years - 80 would be too high for the years remaining in my opinion

If I assume that prices fall by about $7 every year, we would see $80 in about 5 to 6 years. Without any major changes, this seems realistic to me: There will still be 10 years left, if dues rise by 5% annually they'll be around $11-$12 so the costs for points + cost of capital + dues would still be around $23 per point. This wouldn't be terrible for BCV rental even today.

Now, a lot can happen. Disney could build the Yacht Club Tower, rental point costs could go up or down, Universal Epic Universe could make Disney a less (or more) appealing holiday destination - who knows.

The main question will be - as it is now: does the price make sense/offer sufficient value for the remaining years

 

[jimmytammy]

I would buy where you want to stay. We own most points at BRV and love it there at Christmas, its small and next to impossible to book at 7 months for that time of year. We added on resale a few yrs later at BWV for the simple reason we could never book at 7 months for food and wine. We bought 150 points at BWV so we could go every other year for 2 weeks during F&W and stay in a 1 bedroom standard.

We love a lot of the other resorts but also love the fact of staying where and when we want too. 18 more years is a good stretch, IMO.

 

[tom1944]

I think if you have a resort and prime room type you want to stay at on most of your vacations and especially if you travel at peak times you need to buy where you want to stay.

If you go during non-peak periods and the room type you want is not a favored room plus you want to try all the non-restricted resorts for the next 10-15 years buy the best bargain.

Every individual needs to assess how they want to use DVC.

 

[TheDailyMoo]

I think a 2042 on Crescent Lake is the best hedge if you don't want to go all in with dues into the 2070s. In 18 years your life/finances will look a lot different and at that point if you want to reinvest in DVC there will be many options, many of which will still be cheapish because of the resale market.

 

[BuzzLightyr]

I certainly would and have.

Some here think of DVC as buying it for the next generation and passing it down.
Some here think of DVC as retaining value that they can sell later on.

I think of it as locking in roughly half the cost of future vacations now. The more years of vacations you want to partially pre-buy (annual dues make up the other part), the more it costs.

There are different quality locations and quality levels you can buy, and for different durations at various price points.

It's really hard to predict out 18 years to see what your family would want.

I would impute a cost of each vacation (using a time value of money to discount future vacations) and decide if pre-buying that type of vacation for that time period is worth it to you.

A Grand Floridian cash booking will cost more than an Old Key West cash booking. The same thing applies for pricing a VGF contract vs. an OKW contract. And 2042 vs. 2057 - the OKW differentials are fairly representative of the time value of money differences between the two - you simply can't divide by years. Roughly $1 a contact year is a good rule of thumb.

I think the 2042s are generally a good value vs. the longer contracts. The fear of the expiry, the dividing by years math the direct guides use, all overestimate the value of the larger contracts.

 

[Cfabar1]

I certainly would and have.

Some here think of DVC as buying it for the next generation and passing it down.
Some here think of DVC as retaining value that they can sell later on.

I think of it as locking in roughly half the cost of future vacations now. The more years of vacations you want to partially pre-buy (annual dues make up the other part), the more it costs.

There are different quality locations and quality levels you can buy, and for different durations at various price points.

It's really hard to predict out 18 years to see what your family would want.

I would impute a cost of each vacation (using a time value of money to discount future vacations) and decide if pre-buying that type of vacation for that time period is worth it to you.

A Grand Floridian cash booking will cost more than an Old Key West cash booking. The same thing applies for pricing a VGF contract vs. an OKW contract. And 2042 vs. 2057 - the OKW differentials are fairly representative of the time value of money differences between the two - you simply can't divide by years. Roughly $1 a contact year is a good rule of thumb.

I think the 2042s are generally a good value vs. the longer contracts. The fear of the expiry, the dividing by years math the direct guides use, all overestimate the value of the larger contracts.

I don't think you're entirely off base here, especially when you consider the points premium difference...

So, OKW costs about 262 points for a 2 BR in February. Let's say you buy resale at $80 pp - your sunk cost is $20,960
VGF costs about 410 points for a 2 BR in February. Let's say you buy resale at $160 pp - your sunk cost is $65,600

From now until 2042, you have a decent, if not great shot of being able to use those OKW points at VGF - especially if you book early. And your dues go away in 2042... OKW becomes worthless at that point, and VGF will likely have some value being it is a flagship, monorail resort with walking path to magic kingdom... but who knows... MK could close and you're stuck with this dopey hotel building in the middle of nowhere with no swimming pools! Could happen!

The only disadvantage is remembering that you are in fact an owner at Disney's Old Key West... and that the dues are higher, and will continue to go up and be compounding off a higher number. Also, the structure of OKW as a resort means I believe you are likely to have higher dues than VGF which means the growth rate may continue to be higher at OKW than VGF.

To me, VGF and OKW also show so well the difference between levels of DVC products. OKW is a great value play for ownership in my view. VGF is a luxury product in my view.

Personally I struggle with the math with some of the other resorts.... I'd buy VB at around $25 a point, HH around $35... I'd rather buy CC than BR because the points charts are similar and the price differential isn't as severe as the math above. I can't wrap my head around buying BW or BC... I'd trade into them, but can't see actually buying as much as I might be tempted as the BW is my favorite part of WDW...

Did I just persuade myself to sell my VGF contracts and buy OKW?