DVC Adopts Repugnant Timeshare Practice

[Werner Weiss]

Disney is now adopting the timeshare industry's repugnant practice of artificially reducing the value of resales. That's surprising and very disappointing.

In the past, DVC treated developer and resale members/owners exactly the same. It was one of the ways in which DVC demonstrated the highest level of integrity in the timeshare industry.

DVC announced today that as of March 21, 2011, new DVC resale members/owners will no longer be able to use their DVC points for the Concierge Collection (luxury hotels), the Disney Collection (DCL cruises and non-DVC Disney resorts) or the Adventurer Collection (active vacations). Resale buyers will still be able to use their DVC points for DVC resorts and timeshare exchanges through RCI and two smaller timeshare entities, with no change in the rules.

Disney's new policy is not as obnoxious as Marriott's policy of extracting substantial money from resale buyers of "beneficial interests" (Marriott Destination Club Trust points) to make those points normally usual for Marriott Vacation Club resorts. At least the ability to use DVC points for DVC resorts is built into the points and conveys fully to resale buyers.

The ironic thing is that when resales are artificially made less desirable, the people who lose the most are those of us who bought from the developer. We now own something that sells at a lower price than it should. So if we want to sell (or need to sell), we get less than we should. On the other hand, the resale buyer pays what it's worth. Because it's worth less (or perceived to be worth less), the resale buyer pays less. It's a bad deal for the developer customer and a good deal for the resale customer.

[mcow1]

Wow, that really sucks. Almost makes me want to sell before March 21.

[DVC Mike]

From DVCMember.com:

Disney Vacation Club® has announced a new policy that limits access to certain Member Getaways exchanges for Ownership Interests purchased on the secondary market (also known as the re-sale market).

Under the new policy, Members who purchase from anyone other than Disney Vacation Development, Inc., on or after March 21, 2011, will not be eligible to use those Vacation Points to make reservations within the Concierge Collection, the Disney Collection or the Adventurer Collection. Those Vacation Points will instead be valid only for reservations at Disney Vacation Club resorts, as well as for RCI® exchanges, Club Cordial and Club Intrawest.

The affected collections are special Member benefits programs offered by Disney Vacation Development, Inc., and are not part of Members' Ownership Interests. That said, Members who purchased on the secondary market prior to March 21, 2011, may use those Vacation Points for all Member Getaways.

[DVC Mike]

From the Orlando Sentinel:

In a bid to buttress its own sales, Disney's time-share business said Tuesday it will impose new restrictions on buyers who purchase their time shares from existing owners — rather than directly from Disney.

A Disney Vacation Club spokeswoman said customers who bought their time shares directly from Disney have requested such a change.

"Our members just felt that that they should get more benefits when they purchase through Disney Vacation Club than those who purchase on the secondary market," spokeswoman Diane Hancock said. She added that the change aligns Disney with other time-share operators who impose similar restrictions on resales.

But some company followers said Disney is trying to prop up its own direct sales, which stumbled during the global recession and credit freeze. Disney reported lower vacation-club sales during its 2010 fiscal year, which ended Oct. 2.

[mcow1]

In a bid to buttress its own sales, Disney's time-share business said Tuesday it will impose new restrictions on buyers who purchase their time shares from existing owners — rather than directly from Disney.

A Disney Vacation Club spokeswoman said customers who bought their time shares directly from Disney have requested such a change.

"Our members just felt that that they should get more benefits when they purchase through Disney Vacation Club than those who purchase on the secondary market," spokeswoman Diane Hancock said.

Yes, I'm sure members asked Disney to "Please lower the resale value of my time share"

[KinnT]

In response to DVC's new Resale policy...
Our conversations with owners reveal that most do not buy to use the extra programs as they can get a cruise comparable online without using points and also the concierge hotels offsite have comparable rentals by the time you use the increased points required and pay the reservation fee. The average owner does not own enough points to do the larger point requirement vacations. As far as declining value caused by the changes, we will see. Although, I feel the DVC product has already taken the loss the past year and has pretty much become much more stable. I do not foresee additional declining values due to the already large gap between resales and new from Disney. Now is the time to buy resale at the lowest prices ever and still get the additional features, if those features are important to you the buyer.

Kinn Tutas Lic. R.E. Broker
866-544-2919
www.ResalesDVC.com

[disneylandtour]

Yes, I'm sure members asked Disney to "Please lower the resale value of my time share"

Agreed. It's ludicrous statements like this--which is an obvious marketing lie--that makes pretty much any official statement from the Walt Disney company suspect.

It would be nice if I didn't need to try to figure out which official statements are lies, which aren't.

[akfandisney]

Himm
Look like I need head over the the web site more.

[All4dISNEY]

I didn't buy into DVC with the intention of ever reselling. I bought it PREpaying my portions of my future vacations. I would rather reservation preference go to direct buys versus secondary purchases.

I am HAPPY there is some distinction between memberships purchased directly versus secondary market.

It's buying NEW versus USED.
NEW = Everything works, all is shiny, smells good.
USED= Somethings might not work, a few scratches n' many a dent, new smell is gone.

[Werner Weiss]

It's buying NEW versus USED.
NEW = Everything works, all is shiny, smells good.
USED= Somethings might not work, a few scratches n' many a dent, new smell is gone.

In this case, however, the developer (Disney) is applying "scratches and dents" (in the form of fewer usage options) when the person who bought it NEW tries to sell it to somebody else. So the person who bought it NEW is hurt by the developer because the resale value is artificially reduced.

The person who bought it USED gets the advantage of a lower price. And then he or she suffers no additional artificial reduction in resale value when he or she resells it.

So Disney hurts the person for who bought it new, but really doesn't hurt the person who bought it resale (and was willing to buy it despite being shut out of some options) because that person could buy it at a reduced price. How is that something to be HAPPY about, if you bought it new?

You may have every intention of keeping DVC for 50 years, but it's really not possible to predict your health, your financial situation, your changing interests, where you'll live, your family situation, and many things beyond your control 20, 30, or 40 years from now.

I have no problem with the marketplace determining the resale value of my DVC points. I expect the value to go down as the expiration date gets closer.

But I don't see how anyone benefits from Disney artificially reducing the value of resales. It's a shortsighted policy change that may come back to bite Disney.

[All4dISNEY]

^^ I view it like anything else I buy NEW. No matter what, it's not going to retain value, resale or otherwise, unless a secondary market dictates it so.

Since I'm paying a premium by purchasing direct from Disney, I'm delighted to be differentiated from the resales via level of offerings.

As for the resellers getting the best potential resale value for their buck, I'm not going to lose any sleep over MAYBE 'losing' a few thousand virtual dollars. I'm going to be happy that I have higher level of service than 'they' do. I'd like the delta a little wider too.

[DVC Mike]

Things like the Disney Collection, the Adventurer Collection, the Concierge Collection, and AP discounts are all offered by Disney Vacation Development (DVD), the unit that builds the resorts and then sells the memberships. They are not part of our "ownership interest" and the cost of these programs is not passed on to members and is not included in the annual dues we pay.

They are - pure and simple - sales and marketing tools to entice people to purchase an ownership interest.

I am not defending DVD but I can see how they'd want to differentiate resale versus direct and make it more enticing to purchase direct. They now have an answer to the sales prospect who asks "Why buy direct when I can buy resale for less?"

Since it's really a waste of points to use your points for the Disney Collection, the Adventurer Collection, and the Concierge Collection, it's no great loss to potential resales buyers anyway. It's more symbolic at this point.

It may, however, lead to lower resale values and cost existing members who wish to sell their points, which is the real shame.

[mcow1]

Since it's really a waste of points to use your points for the Disney Collection

True, but often here on the west coast that is the only way to get a room using points. With only one DVC hotel it is often booked several months in advance.

[akfandisney]

That what I'm doing this weekend at Disneyland Hotel use Disneyland Collection
there is only Fifty room are DVC and most of the time is all book up.

[Jerren]

I wonder though, from the wording of the announcement it seems like it only impacts those who are not already DVC members. Meaning if I as a Member wanted to say buy A chunk of points from a 3rd party I may still be able to use them for the concierge collection, or at least bank/borrow enough points with mine and use the ones I got from the 3rd party for a room at WDW.

I wonder if they know how big a PITA it will be to try to manage clients with "mixed" points, how many of my Disney DVC points did I use on this trip vs the "3rd party" points on the other? I have a feeling they will just grandfather you in if you do your initial buy in with Disney then buy 3rd party points on the open market versus the cost and headache of trying to manage which points where used where, their system just isn't set up to do that.