RESALE POLICY CHANGE!

[zavandor]

I believe the impact will be more psycological than practical.
How many time have we read on this board the question: Are resale purchasers treated differently that direct purchasers?
Now the answer is yes. A direct purchaser can take his shiny member card and get all sort of wonderful benefits (many of which they probably will never use) while the poor resaler will have to stay at home to clean up while the stepsisters go to the ball.
Ok, it won't be that dramatic, but people like to feel special, not half special.

 

[SleighBelle]

people like to fell special, not half special.

Very true!

 

[kenspidey]

I guess if this causes resale prices to drop a bit then I will finally buy the add on that we were thinking about.

All of this is very interesting....Is it possible that Disney is trying to deflate the market to get inventory for sold out resorts at a reduced price. Currently there is no inventory for Beach Club and I wonder ???? ROFRed contracts are still going pretty high and if Disney keep this price level for ROFRing then more contracts will revert to them.

 

[DisDadDVC]

people like to fell special, not half special.

But if everyone is special, no one is....

 

[kenspidey]

Ok- since we are grandfathered in (bought resale two years ago) and still have access to the membership perks- will we continue to have the perks if we add on via resale (we are looking at purchasing more points in next year) or do we now need to consider purchasing an add on direct???

Highly unlikely...You have the membership card already. They just issued all those shiny new cards for this very reason. I think you are all set.

 

[Eric Topp]

Another comment - if you part of your reasoning for buying DVC is the value that you get when you sell it, I don't think you are doing it right.

Especially with all the 2042 properties - those properties are going to start hitting a wall in the next 10 years. Think about it: in 2026 you can buy resale into BCV, but it's only good for another 16 years, whereas somewhere like BLT will have something like 34 years. You can't tell me that resale on that BCV property will be able to hold up in the same price neighborhood. Another 10 years after that you won't be able to give away a BCV property with 6 years on it.

In other words -> all DVC resale values are going to trend to zero eventually.

The larger question is what category will you be in if they extend a property?

 

[DVC Mike]

As I stated in my Do DVC Members deserve better perks post, perks offered by DVD are a marketing tactic to entice people to buy into DVC. From a marketing perspective, DVD needs to provide some differentiation between buying direct and buying resale. There has to be some justification for the price variance between direct and resale. Clearly, the changes they made in 2011 have been deemed not effective enough. We have seen direct point sales decline over the past year, and this is a plain and simple marketing tactic to increase the value of a direct purchase over a resale purchase. Guides must be jumping up and down with excitement for this new sales tool.

DVD is a business, and it exists to sell. Perks are a marketing tool to help sell. The primary reason for DVC to offer perks is to help improve sales by Disney Vacation Development. Offering perks to all members does increase their goodwill towards Disney and increases the positive word of mouth about DVC from current members to their friends and family. A lot of happy members providing positive word of mouth advertising would be a good marketing tool. So, it's good for business - to a certain extent. However, in this case, DVD decided it's direct sales would be better enhanced by differentiating it more from resales.


http://i235.************************************************************* DVC Mike - *******.com

 

[jerseyduke]

Are you serious,?! So if you take up two days in a week via a short term rental and then I make a reservation for a week at another resort due to not having a full week then 5 days are potentially dead now multiply that times 100 short terms, Get it now?

That is what a time share is. You should have made your reservation first.
You also make many assumptions:
1. The majority of rentals are short term.
2. The majority of owners make reservations for a week.
(I would not be surprised if the opposite is true)
3. Most stays are a week.
3a. Those week stays are all Saturday-Saturday, or Sunday to Sunday. What about Wednesday to Wednesday?

Do you have any data to suggest that most rentals are short term?

 

[ParkHoppers]

This new restriction for resale buyers WILL sell more direct contracts. Not by me but they will sell more. Like was said before people want to feel special by getting membership perks. Just human nature.

 

[jerseyduke]

A logical, and frankly fair way to deal with resales would be that those resale points could only be used at the home resort. That I would totally understand.

If you do that, you can all but kiss switching at 7 months goodbye, because no resale contract would be able to trade out.

 

[Sandisw]

But you would be an owner that has bought directly from Disney.

And I am sure Disney has thought about it. And they may very well have thought "what if we get a small direct add on sale from every new member that buys off the resale market?"

Then again, perhaps with the ongoing conversion of cash hotel rooms to DVC rooms, maybe they just want to cut down on the number of discounted APs,

While I do not see it as particularly spiteful, I do think it should exclude any contract that has been sent to ROFR.
I have one that has passed ROFR, but the seller can not close until the end of May. I do have a direct contract, so I am "safe"; otherwise, I might have been pretty agitated by it.

Yeah, I didn't think about them getting lots of little add ons. Now, I wonder if the POS allows them to make the minimum for add ons a "member extra"? So, if you are a current owner, you get to add on with as little as 25 points, but if you are a new owner after 4/4/ who didn't buy direct, your minimum would be 50 points. It certainly will be interesting how they handle this.

 

[Sandisw]

If you do that, you can all but kiss switching at 7 months goodbye, because no resale contract would be able to trade out.

Restricting points to the home resort is definitely not something that can ever be made different for resale and direct. As long as the resort is part of the club, it gets to trade. The only way to prevent a resort from trading is to remove it from the club. If it is removed from the club, then all owners of that resort, regardless, will not have trading rights at 7 months.

 

[bwvBound]

Ambiguity seems to be Disney's specialty. You have that ambiguity in the Membership Extras Statement that could be construed to mean that effective 4/4/16, anyone who has purchased only resale, incuding prior purchasers, would lose the benefits. That same document initially defines "Members" as only those who buy directly from Disney, but then says "Members" who do not buy directly from Disney do not get the benefits, i.e., a contradiction in terms. Nevertheless, the statement on the site and the actual letter from Potrock said that all those who purchased pre-4/4/16, regardless of whether they purchased from Disney or resale, will be entitled to the applicable benefits now being excluded for new purchasers.

As to how bad the loss, we still have the 25 point add-on issue. It appears that a new resale purchaser can overcome any issues by simply adding on 25 points through Disney. That may be all that Disney wanted to accomplish but we need to see if any other restrictions will be announced. It may make sense to allow even just the add-on purchaser to get the extras because most of them -- e.g., merchandise discount, AP discounts, TIW, dining discount -- are profit makers for Disney both in their sale to and use by the member, and keeping members on site to otherwise spend more money.

I do not consider this a change anyone should be happy with. Every member may someday be a seller and this lowers the resale value, and thus every member is impacted negatively.

I'm guessing this opens the door to tiered benefits based on qualified points.

 

[bwvBound]

On the NOTIFICATION section of the web site, they are two new links appearing on my screen. The one for the policy change letter from Potrock, however, the other one is blank (except the link Mark as Read). Is this the view everyone is seeing? I am nervous what another notification might say.

I see the same.

 

[ziravan]

Yeah, I didn't think about them getting lots of little add ons. Now, I wonder if the POS allows them to make the minimum for add ons a "member extra"? So, if you are a current owner, you get to add on with as little as 25 points, but if you are a new owner after 4/4/ who didn't buy direct, your minimum would be 50 points. It certainly will be interesting how they handle this.

If they restrict sales to 50 points for resale buyers, that starts to have an effect on new sales, and that's almost certainly counter to the goal of these changes in the first place.

The number of 25, 40, and 50 point Poly contracts is amazing.

My guess is that even if they originally demand a higher buy in to count as a full member, they'll relax it (just as they currently do) if it impacts sales.

Members buying small add on are an essential component of $170+ pp.

 

[nolanboys]

Not pleased with the new announcement, but it is what it is. The extras that they are taking away are nice, but IMO nothing that spectacular to make me want to pay direct prices as I feel those have gotten out of control. Glad that we only have 200 and with all the nickel and diming all around WDW, we had no plans to add on. This new policy just reaffirms that decision.

 

[Sandisw]

Just got off with a DVC MS rep re: chat. Yes, anyone buying resale after today who then adds on points will be eligible for the member perks. I asked if the minimum was still 25 points and he said he wasn't sure but he'd transfer me to sales. Didn't want to talk to a guide, but it seems that will be the way around it for resale buyers if the perks, such as AP discount, is worth it.

 

[disneynutz]

Just got off with a DVC MS rep re: chat. Yes, anyone buying resale after today who then adds on points will be eligible for the member perks. I asked if the minimum was still 25 points and he said he wasn't sure but he'd transfer me to sales. Didn't want to talk to a guide, but it seems that will be the way around it for resale buyers if the perks, such as AP discount, is worth it.

And DVD will be selling more add-on contracts, exactly what the wanted, additional revenue and higher profits!

Bill

 

[tlkscott]

I should have said the discount provided by the TiW card. New resale buyers won't be able to buy TiW as a DVC member.

Actually anyone with an Annual Pass can buy the Tables in Wonderland card.

 

[malba2366]

All of this is very interesting....Is it possible that Disney is trying to deflate the market to get inventory for sold out resorts at a reduced price. Currently there is no inventory for Beach Club and I wonder ???? ROFRed contracts are still going pretty high and if Disney keep this price level for ROFRing then more contracts will revert to them.

If they wanted to buy back resale contracts for Beach Club that were resold, they could have done so and then turned around and sold them for a profit. I really believe (this is speculation) that they are using all the guest data they collect to figure out whether or not to exercise ROFR. For example if there are 4 people waiting for 50 point BCV contracts, and a 200 point BCV contract is sold they will use their data to make assumptions about whether to exercise ROFR or not by looking at the total revenue to Disney over a certain period of time (including ticket sales, food purchases etc).
This is why the ROFR process seems random, but I would guess that in actually a lot of calculations are being done by Disney to figure out which is best for them. Im sure they have enough guest data collected to very accurately predict what will result in a higher revenue stream for them.

 

[wdrl]

Yes it is.

About half of Poly contracts sold thus far are add ons of 75 points or less, and the majority of those are 50 or less.

Even if DVC set the bar at 50, then add a 50 point contract to Vero Beach at $110 and immediately rent out 2015, 2016, and 2017 points...

My sales data does not support your statement. I'd want to check all the Residential Units at PVB, but I'm finding about a quarter to a third are small deeds of 75 points or less. Furthermore, there are a number of cases where the same owner(s) bought two or more of these smaller deeds, so they actually have 100 points or more.