Will There Be A Glut Of DVC Resales?

[calypso*a*go-go]

If DVC really does crack down on commerical renters, how many will start selling large quantities of contracts, and what will that do to the overall value of a membership? Will it drive the ROFR level down if there are so many that DVC cannot possibly buy them all back? It wouldn't really matter if you intend to hold onto your contracts for the duration...but what about the people that keep their's for a few years and then realize it's not a good fit anymore? Just a few thoughts that have been whirling around in my head (trust me...there's lots of room upthere!)...

 

[JimMIA]

I don't think so. I'd bet that the number of individuals DVC is really concerned about could be counted without taking my shoes off. I think we are talking about very small numbers, and some of those may not actually own a ton of points.

 

[Lewisc]

If any of the commercial renters had a shill owner with blocks of VB,HH or even OKW points those points might get sold. I'd expect BCV,BWV and VWL points are worth renting, unless the commercial owner just decides it's not worth renting what they own.

 

[DisDaydreamer]

Seems likely there will be a flood of larger contracts, but I don't know that Disney can't afford to stand behind ROFR. I guess it really depends on how much of the DVC holdings are in commercial hands. The value could go down, It may need to to entice a flood of buyers. Maybe if Disney finds themselves with a huge glut of inventory they would initiate some sort of exchange program (you can exchange, but you have to buy 1.5 times what you now own) It will be interesting to see how it all unfolds.

Anyway, we're now in the packing stage for VERO BEACH

 

[BirdsOfPreyDave]

Can you sell off part of a contract? I don't know for sure, but assume you can't. If the big commercial renters start trying to sell, their problem is going to be finding a market for people who want to buy 1000 point contracts.

 

[spiceycat]

I though Dumbo71 had found it was the DVC member who don't own the points - that are the problem.

big commercial renters own their points. So even if we (disers) don't like them... they are okay in DVC terms.

it is (like that woman - no names) who use to ask for points to be transfer to her account - claiming that her family was ill, etc..... so she got lots of people to sell her their points - transfer the points to her account then she resold them for a nice profit.

Disney is trying to stop that type of person who tries to take advantage of others.

I would hope most commerical renters aren't that under handed. Could be wrong - but I would hope....

so even that person who advertised in the paper is fine - as long as they are using THEIR points not somebody else points who they talked into transfering into their account.

am I wrong?

 

[LisaS]

I think Disney will target anyone who rents a lot of reservations, whether they use their own points exclusively or a combination of their own points and transferred points. These people undercut CRO and impact Disney's ability to sell DVC (why buy when you can find plenty of people willing to rent you a reservation?)

Unless these commercial renters are independently wealthy, I would think they would have to sell some of their contracts. For example, Mush's family may own as many as 18000 points. Average dues are about $4.50 per point so their annual dues bill would be about $81,000! It would be prohibitively expensive to be sitting on such a mountain of points with no rental income coming in to cover the cost so I would think they would have to sell some of them.

 

[calypso*a*go-go]

This is pure speculation of course, but what if the "family-that-must-not-be-named" was found to be in violation of the DVC contract terms...could a situation ever arise where DVC would actually buy the points back from them at a negotiated price, as some type of compromise? I mean, I could see where something like this could turn into a huge legal battle if they were told to stop "commercial renting", but they felt they still had a right to do so. They'd have their investment back (probably at a profit of some kind) and DVC would have the points back in their inventory to sell again. I think this is a more reasonable solution than having the value of memberships go down due to an increased number of resales, especially when DVC is still actively selling new memberships.

 

[LisaS]

There was a post some time back that Disney has offered to buy back points from some members at around $55/point or something in that ballpark. But I'm not sure that Disney would want all of those points back. I think they will just tell them to stop renting and use the points for their intended purpose. It will then be up to the renters to figure a way out of their financial predicament.

The renters could try to take legal action, but it would be very expensive to take on Disney.

 

[Lewisc]

Disney may have some legal issues if they try to stop members from renting their own points. I doubt those owners will "be sitting on their points" but will be waiting for legal remedies that will include damages.

I'll agree with the previous poster, a solution that included Disney buying back points is much more likely.

I don't know the legal ramifications if Disney wanted to stop owners from changing the names on a reservation. That would stop owners from making reservations on spec.

I think Disney will target anyone who rents a lot of reservations, whether they use their own points exclusively or a combination of their own points and transferred points. These people undercut CRO and impact Disney's ability to sell DVC (why buy when you can find plenty of people willing to rent you a reservation?)

Unless these commercial renters are independently wealthy, I would think they would have to sell some of their contracts. For example, Mush's family may own as many as 18000 points. Average dues are about $4.50 per point so their annual dues bill would be about $81,000! It would be prohibitively expensive to be sitting on such a mountain of points with no rental income coming in to cover the cost so I would think they would have to sell some of them.

 

[JimMIA]

Disney may have some legal issues if they try to stop members from renting their own points.

Somehow, I think the Disney lawyers may have considered that.

And actually, if you read your POS, you'll see that it gives them enormous latitude and they have a very wide range of options. I won't be losing any sleep worrying about Disney's legal position.

 

[dianeschlicht]

Disney may have some legal issues if they try to stop members from renting their own points. I doubt those owners will "be sitting on their points" but will be waiting for legal remedies that will include damages.

I'll agree with the previous poster, a solution that included Disney buying back points is much more likely.

I don't know the legal ramifications if Disney wanted to stop owners from changing the names on a reservation. That would stop owners from making reservations on spec.

Very good point about the changing of names on a ressie. I doubt that will happen though, as long as the ressies are made using points they OWN and not points they have had transfered in . I think the real issue with the transfers was that the folks doing it were getting those points morphed into non-home resorts and morphed into useable points even though they should have been expireing. THAT is the pure profit part for that kind of commercial renter. The person who actually owns 18,000 points should be able to rent them without issue as long as they actually own that many. Now, can they get enough to pay the maintenance fees without use morphed and transfered points? I don't know...Depends on how much they were doing of that activity. I'm still boggled by the fact that they could buy that many in the first place. How did THAT get by the DVD watchdogs?

 

[jdg345]

Somehow, I think the Disney lawyers may have considered that.

And actually, if you read your POS, you'll see that it gives them enormous latitude and they have a very wide range of options. I won't be losing any sleep worrying about Disney's legal position.

Agreed; it'll be interesting to see how it plays out ... does the POS stipulate what the ramifications are if you are found to be in breach of contract? I don't remember and I have all my paper work in a safe deposit box.