VGF contract so overpriced

SecondEventuality

Mouseketeer
Joined
Jun 28, 2019
I was surprised to see that VGF has "reduced" on some small contracts (under 100) for a certain website. I'm not sure, but I usually see "firm" on small contracts, where they will only accept the asking price, so I found that surprising for under 100!
 

Matty B13

DIS Veteran
Joined
Jun 13, 2016
Just 6 months ago, most VGF small point contracts (under 100 points) would get snapped up almost instantly, now I've watch a whole bunch of contracts under 100 points sitting for over a month now. I follow my UY for VGF contracts and I can't believe how many are just sitting on brokers websites right now. I think that it has been way overpriced this year, and now with the RIV restrictions, there should be a repricing on contracts.
 

SecondEventuality

Mouseketeer
Joined
Jun 28, 2019
That makes much more sense, thank you. I think we will wait to add on until things die down. I made the mistake of watching a video of a VGF 1 bedroom and now I feel so doomed. Lol!!! Glad to know it can wait and essentially bide our time.
 
  • mustinjourney

    DIS Veteran
    Joined
    May 8, 2016
    That makes much more sense, thank you. I think we will wait to add on until things die down. I made the mistake of watching a video of a VGF 1 bedroom and now I feel so doomed. Lol!!! Glad to know it can wait and essentially bide our time.
    Prices will go up again within the next 6 months.
     

    RaymOOOnd

    Mouseketeer
    Joined
    Jun 14, 2015
    I'm not so sure that these prices have nowhere to go but up.
     
    Last edited:

    mustinjourney

    DIS Veteran
    Joined
    May 8, 2016
    tough to say that with certainty.
    keeping all other factors the same (i.e., economy doesn't tank or disney doesn't introduce some other crippling resale restriction) -- prices dip this time of year and then start to increase. The theory is that owners that are on the fence about selling get their dues notice about this time, and that bill is enough of a push to get them off the fence and to get their contract listed for sale. This results in larger supply, and if demand hasn't changed, then prices tend to dip.

    Around February/March -- a lot of people are done paying off xmas and many companies pay out their bonuses to employees. More people flush with "extra" cash tends to increase demand during this time frame, which is one of the reasons you start to see prices rising during this stretch.
     

    poofyo101

    Mouseketeer
    Joined
    Aug 13, 2019
    keeping all other factors the same (i.e., economy doesn't tank or disney doesn't introduce some other crippling resale restriction) -- prices dip this time of year and then start to increase. The theory is that owners that are on the fence about selling get their dues notice about this time, and that bill is enough of a push to get them off the fence and to get their contract listed for sale. This results in larger supply, and if demand hasn't changed, then prices tend to dip.

    Around February/March -- a lot of people are done paying off xmas and many companies pay out their bonuses to employees. More people flush with "extra" cash tends to increase demand during this time frame, which is one of the reasons you start to see prices rising during this stretch.
    I would say all of that to be true. However prices cannot just keep going up forever. Sooner or later its just too expensive for what it is. Just my opinion.
     

    Bearval

    Mouseketeer
    Joined
    Dec 31, 2017
    I would say all of that to be true. However prices cannot just keep going up forever. Sooner or later its just too expensive for what it is. Just my opinion.
    There is going to be a point in time when the expiration date is going to have a major impact and prices will begin to drop every year as that date gets closer. Is it 10, 15 or 20 years before a contract expires? No one can say for sure right now but we will have an answer when 2042 gets closer.
     

    mustinjourney

    DIS Veteran
    Joined
    May 8, 2016
    I would say all of that to be true. However prices cannot just keep going up forever. Sooner or later its just too expensive for what it is. Just my opinion.
    inflation happens. Also, so long as DVC is still >40% discount over hotel rooms, if room prices go up, you can expect DVC too as well.

    But yes -- at some point the contracts will all be worth close to zero just b/c of the remaining time factor.
     

    BlackTea

    Earning My Ears
    Joined
    Feb 18, 2019
    inflation happens. Also, so long as DVC is still >40% discount over hotel rooms, if room prices go up, you can expect DVC too as well.

    But yes -- at some point the contracts will all be worth close to zero just b/c of the remaining time factor.
    I think It will only be zero after the expiration date. Basically price per point, plus annual dues, then times the number of points required for reservation will be your cost. By the end of the contract life, especially 2041, it could be infinitely approaching the the cash reservation price, but should not surpass...

    On the other hand, say today people are willing to take on 50 year commitments so that they pay 60% of the cash reservation price, when there are only 5 year left on the contract, maybe they are willing to pay 80%, just 5 year commitment, no big deal, meanwhile 20% is still descent savings...so basically it will be more and more determined by the cash reservation price...
     

    iflyjetzzz

    Earning My Ears
    Joined
    Nov 27, 2019
    keeping all other factors the same (i.e., economy doesn't tank or disney doesn't introduce some other crippling resale restriction) -- prices dip this time of year and then start to increase. The theory is that owners that are on the fence about selling get their dues notice about this time, and that bill is enough of a push to get them off the fence and to get their contract listed for sale. This results in larger supply, and if demand hasn't changed, then prices tend to dip.

    Around February/March -- a lot of people are done paying off xmas and many companies pay out their bonuses to employees. More people flush with "extra" cash tends to increase demand during this time frame, which is one of the reasons you start to see prices rising during this stretch.
    I've watched the DVC market for several years now and that's exactly what I've noticed-a dip during the holidays.
     

    Cyberc1978

    DIS Veteran
    Joined
    Jul 19, 2016
    Prices will go up again within the next 6 months.
    Even if I hate to say you are right - you are. As long as there is a significant saving buying VGF resale to direct but also vs booking direct then the contracts will continue to sell.

    Lets assume you buy a contract for $188 pp with 100 points. Closing is $635 thats a total of= $19435

    The VGF contracts have 44 years left

    $19435/4400 = Cost per point $4,417 + $6,562(Dues for 2020) = Total cost per point used in 2020 is $10,979

    a studio in dream season

    Standard view
    Sun-thu 21 point: $10,979 x 21 = $230
    Fri-sat: 24 point: $10,979 x 24 = $263

    Rack rates in May 2020: $796/$874

    Savings compared to booking direct: 71% / 70%

    Assuming instead $165 pp

    $16500 + $635 closing = $17135

    $17135/4400 = $3,894 + $6,562 = $10,456

    Standard view
    Sun-thu 21 point: $219
    Fri-sat: 24 point: $251

    Savings compared to booking direct: 72% / 71%

    Even if you get a 30% discount on rack the savings are still 58%/57% for a $188 pp contract.

    How small the savings should be before the contracts wont sell I dont know. Right now they are pricing me out and that could also be a factor for the prices to go down.
     

    AtomicFrog

    Always up for WDW
    Joined
    Nov 12, 2017
    Just make your offer and go from there.. when i listed mine i put $180 a point so i could take $170-172 which is what I wanted... always haggle
     

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