OKW 15 year extension

[GHD]

Personally, I have been rather peeved with Disney regarding the OKW 15 year extension (from 2042 to 2057). First, they called the meeting in Florida with one month's notice. Then, surprise!, at the meeting it was voted to make this extension mandatory unless you file an opt-out which needs to be NOTARIZED!

When I called to complain, I suspect I wasn't the first since the girl said that to make up for my inconvenience I would get $30 off my dues next year. I'll bet everybody gets the $30 off (even the extenders) and since this is the money needed already to run OKW it's just like getting my money back. Leave it to Disney to make us think we are getting something but really we are getting something we have already paid.

I doubt Disney will allow me to get the attendance records from the meeting nor the number of extenders vs. non-extenders. But I was wondering if anybody else has a problem with the methods used here. I'd bet money there will be people who don't read carefully and will be billed for the extension when they don't return the opt-out.

Got a bad taste from this one.

GHD

[Daitcher]

LOL.....

It made me glad that I had previously sold my OKW points.

The whole thing stinks like rotting carcas. It feels like a good old fashioned shake down of OKW owners. DVC felt that OKW owners hadn't paid enough intially so why not squeeze some more free money out of them. Those same people that extended will be paying for a complete refurb of a 50 year old OLK Key West Resort.

I posted this before but I can't help but think of some creepy bean counter cashing those checks and laughing hysterically at each one..... Seriously, nobody in their right mind would pay NOW for something that has no value for 35 years. What if I tried to sell folks a Timeshare NOW for a cheap price but the catch is that it would have no usage for 35 years...........? It wouldn't sell, I'd be ridiculed and thrown in jail. Somehow DVC does it and it is fine.


DAVE

[AFMom]

Don't worry - I don't take much personally - and am not offended - but I certainly don't feel like a "fool" for extending. We own 100 pts at OKW and were quite happy to extend. With the deal we got - it only cost us $1500 to get all those extra years. Even if we never actually ued the points and rented them out every year - it would only take 2 years to re-coup that cost (well - less than 2 years) and then we'd only be out maint fees on the extra years.
I think OKW has been kept up quite well - and even with the pool being updated - didn't see that large of a rise in my dues. I'm sure there will be some extra improvements needed - but there is an account set aside for that (can't remember the name right now).
We love OKW - and being only in our early 30's - are really looking forward to all th extra years there.
And - No - we don't get the $30 off our dues.

[jbrowna]

LOL.....

Seriously, nobody in their right mind would pay NOW for something that has no value for 35 years. What if I tried to sell folks a Timeshare NOW for a cheap price but the catch is that it would have no usage for 35 years...........? It wouldn't sell, I'd be ridiculed and thrown in jail. Somehow DVC does it and it is fine.


DAVE

I agree totally. :worship: Why are we paying money now for things that we won't have any usage for long into the future? Like, say, retirement investments: good grief, here we are paying money into IRA's and 401K's, and we won't get any usage out of them until we retire! And, God forbid, if we should die before then, all the money (what's left after the government takes its cut) will go to ungrateful relatives or descendants who won't even remember who left it to them! Why not spend that money NOW making memories with our kids and family instead of paying into something that has no usage for who knows how many years?

And what about insurance? Here we are paying tons of cash into something that a fair amount of us will NEVER get anything out of! Sure, if you're careless and get into an accident, or get sick or something, it might pay off. But for the vast majority of us, we'll pay in far more than we'll ever get out of it (that's how insurance companies make money, no?).

Yep, this reasoning is impeccable! I can see how it applies to so many other things in my life..... In fact, I'm going to propose to DVC that all contracts should be no more than two years in length. Anything beyond that, and I'm merely paying NOW for something that won't have any usage for two years -- since I can at least borrow from next year, I can get some kind of usage now for that. But anything beyond that falls right into the reasoning that's been spelled out and is just foolishness. Anybody buying more than a two-year contract must not be in their right mind. :hypnotict

[burcs]

Seriously, nobody in their right mind would pay NOW for something that has no value for 35 years.
DAVE

i don't think that people who are extending are not getting any value for 30+ years. on the contrary, what they are paying for is more value during that time.

look at it this way. right now, there is a price per point set by the market/ROFR for non extended OKW points until 2042. this will presumably be true until january of 2042, right? at that point, the OKW points will expire worthless. realistically, it will have been unsellable months to even years before then, whenever the price of renting points matched the price of points and closing costs and convenience of not having to go though purchasing.

a 15 year extension delays this. it increases the value of a current contract. while it may be debatable whether the pricing of the cost of the extension is worth it, i don't think anyone can doubt that the value of a OKW contract for a 2057 is more than a 2042.

so no, AFMom, i don't think you should feel like a fool at all (and like you said, you don't!). time will tell whether it was good decision or not, by whatever metric you want to use.

dave, even though i disagree with you here i appreciate the fact that you speak your mind and are (as far as i have seen) rational. i know you mentioned somewhere that you were thinking of getting out of DVC, but if you ever did i hope that you'd still stick around from time to time, if for no other reason than to provide counterpoint.

paul

[Daitcher]

dave, even though i disagree with you here i appreciate the fact that you speak your mind and are (as far as i have seen) rational. i know you mentioned somewhere that you were thinking of getting out of DVC, but if you ever did i hope that you'd still stick around from time to time, if for no other reason than to provide counterpoint.

paul



Thanks Paul.

I'm not out yet and even if I do I think I'll still have some perspective to add so I'll likely still post here.


DAVE

[Daitcher]

With the deal we got - it only cost us $1500 to get all those extra years. Even if we never actually ued the points and rented them out every year - it would only take 2 years to re-coup that cost (well - less than 2 years) and then we'd only be out maint fees on the extra years.



Pretty funny how you use the word deal. How is it a "deal" when DVC has put a value on the points of $5, I believe, yet are charging people $15? The difference in extended versus non extended contracts direct through DVC is around $5. So , with this being a fact how does it make sense? You paid $15 for something worth $5............

Also, you talk about renting the recoup the costs. Huh? Renting 35 years from now? Because that is when those points begin that you pre-paid for. So what is that $1500 worth 35 years from now? Even if you use 4% interest as your number that $1500 is actually worth just over $5900. So to cover your cost on that you need to recoup $5900.

Are you a fool? No way and I'm not going to call you one (I'll let Gblast123 do that) BUT what I am going to do is put out my take to help people decide for themselves. At the end of the day the value is in the eye of the beholder. All that matters is that you are content with your decsion and it appears you are so congratulations and may you live long enough to enjoy these.


DAVE

[nono]

Seriously, nobody in their right mind would pay NOW for something that has no value for 35 years.

DAVE (emphasis added by moi)

In my particular situation, I'm already maxed out in 401K contributions, and save 35% of post-tax income. I own my home -- REALLY own it (no mortgage). I have no debt. What the hell else am I supposed to do with my money? So, I'm not in my right mind because I have earned a good living and am a lifelong saver and chose to exercise the OKW option? Yeah, I'm a :dunce:.

Sweeping generalizations....
lead to some hysterically funny posts, even though I don't think that was your intention!
:ROTFL:

[JimP]

I had been predicting for some time now (on another board) that at some point DVC would start offering extensions... and the general consensus was it would never happen.

Here is an similar example that led me to this conclusion:

I own an airplane hangar that is part of a condo association. We own the actual buildings... but the Port of Portland owns the land that our hangars sit on. We have a 30 year land lease... at which point the Port can ask us to remove our buildings... or simply take them over.

At about 10 year intervals... we negotiate with the port to extend our lease back to 30 years. From their perspective... they would have to wait 20 years before they could get anything... or then can extend our lease now and get some revenue. For us... it keeps the value of our hangars high because if we did not negotiate at 20 years... we would eventually reach a point where the Port would make a decision to just wait and let the lease expire... taking our property. It is a win-win for both of us.

BTW: I bought my hangar in 2001 for $15,700. Now I would get over $40,000 if I sold. It doesn't make any difference that I wont be flying 30 years from now (I wont be)... the lease extensions are keeping the value of my property investment high.

/Jim

[carolina_yankee]

Just a plea for perspective, gentle posters. We're talking a DVC contract and people who have the discretionary income (hopefully). Perhaps analogies like 'fool' and 'right mind' are a little strong for financial decisions that may not make sense on a strictly rational/accounting basis but do bring people joy and satisfaction.

Now, admittedly, that may be why a Disney bean counter laughs hystericlaly when posting the checks - but remember, we're all adults, and all have the right to make the decisions we wish to make with our finances . . .

Dirk

[Daitcher]

(emphasis added by moi)

In my particular situation, I'm already maxed out in 401K contributions, and save 35% of post-tax income. I own my home -- REALLY own it (no mortgage). I have no debt. What the hell else am I supposed to do with my money? So, I'm not in my right mind because I have earned a good living and am a lifelong saver and chose to exercise the OKW option? Yeah, I'm a :dunce:.

Sweeping generalizations....
lead to some hysterically funny posts, even though I don't think that was your intention!
:ROTFL:



Okay Nono, you got me. I edited my post replacing the word fools with people. I wasn't trying to offend by any means and from the sound of things you are doing quite well WITHOUT my advice.

As far as the right mind part, I have to stick with that. I was relating that to buying a Timeshare that you couldn't use for 35 years. I stated that nobody in their right mind would do that. That brings me to this: How is it any different to hand DVC money NOW for something that you can't use for 35 years? Is DVC different? Please take me through your thought process on that. Nobody would take a Timeshare with no useage for 35 years, right? Why is it OK when it is DVC?


DAVE

[JimP]

As far as the right mind part, I have to stick with that. I was relating that to buying a Timeshare that you couldn't use for 35 years. I stated that nobody in their right mind would do that. That brings me to this: How is it any different to hand DVC money NOW for something that you can't use for 35 years? Is DVC different? Please take me through your thought process on that. Nobody would take a Timeshare with no useage for 35 years, right? Why is it OK when it is DVC?

Dave,

As I pointed out in my "airplane hangar condo" example... it doesn't matter if you are going to use the property some time in the future or not. The largest reason to extend... or not extend has more to do with how you expect the extension to affect what you already own today.

If you think that it adds more value to your property today... then by all means extend. If you think that it does not add enough value... then decline.

Clearly... at some point the value of an unextended contract will go to zero. OTOH... a continual series of extensions could keep your property as an asset continually increasing in value. Also... as you correctly point out... extending could result in a large special assessment to rebuild a 50 yo resort That can also happen before 50 years too.

I happen to believe that it is a very good deal for DVC to offer extensions. They get extra revenue today for essentially zero work. Whether or not this is a good deal for the members is subject to lots of interpretation. I can certainly imagine it either being a great... or poor decision... not very different than other financial decisions people make.

/Jim

[nono]

As far as the right mind part, I have to stick with that. I was relating that to buying a Timeshare that you couldn't use for 35 years. I stated that nobody in their right mind would do that. That brings me to this: How is it any different to hand DVC money NOW for something that you can't use for 35 years? Is DVC different? Please take me through your thought process on that. Nobody would take a Timeshare with no useage for 35 years, right? Why is it OK when it is DVC?


DAVE

But Dave, you are judging everyone by your own standard of "right spending." There are many ways of "right spending" if all the bills are covered already. DVC or any other major does indeed have value. Will the value equal the sunk cost of extending? We don't know. We'll have to find out by watching how it plays out over time.

Let's take it a step further. Personally, I'd rather spend on the DVC extension, than buy my kids designer organic clothes that they won't fit in a year from now. Would that be a better use of my money? It might be -- I have a friend that does that, because she can afford to do so. It doesn't suit me. She does recoup some money by selling on ebay what hasn't been ruined by drools/spills etc.

What people choose to do with excess dollars is truly always a sunk cost, sometimes with some residual value, sometimes not (HD DVD adopters come to mind...)

I think that what DVD has done in this case is compete for excess discretionary dollars. Just like Rolex doesn't sell watches, it sells luxury. It doesn't compete against other watch companies, but against all other luxury purchases. (Not saying that DVC is luxury, but, like Rolex, competes for discretionary dollars).

As for a Disney bean counter laughing at me, what do I care? If it wasn't a DVD bean counter, it would be a Burberry bean counter, or a Tag Heuer bean counter, or <insert unnecessary purchase here>....

Again, personally, the OKW extension was a great spend for me, 'cause I'm as cheap as they come. It is the single cheapest "insurance" I could find to almost guarantee I'll be alive to use all 15 of those years. :cheers2:

[Daitcher]

JimP and Nono.

You guys make great points.

Nono: enjoy those extra years.

JimP: I agree with your post, we'll have to wait and see. As I stated before I'm glad I sold out before this happened. My response would have been a RESOUNDING NOOOOOOOOO, but that decsison could have been ultimately a mistake. I now have the luxury of watching how this plays out from the sidelines. I'm curious to see resales of extended versus non in the years to come.

As an aside to the OP, I've heard from reliable sources that this extension was fairly well received by the membership.


DAVE

[nono]

Hey Dave,

Can we at least agree that this would be a worse spend than an OKW extension:

http://www.eluxury.com/estore/browse/product_detail.jsp?id=11757332

$265 for polyester...

and white!

For a toddler.

$265 for about a 4 hour use-life (till it gets stained and ruined!). Makes those extra 15 years look like a bargain! :magnify:

:slyasafox

[glypnirsgirl]

I have always stayed out of this discussion ... I still do not know whether I will extend or not. But Nono's post distilled what this argument is truly about and that is:

"Compared to what?"

Basically, each person is going to evaluate whether or not this is a good expenditure based on their other choices of what they would be spending their money on. You have to know what the "what" is before you can properly evaluate. (So compared to a 100% polyester paneled dress for a toddler --- its a AB FAB INVESTMENT. And don't you just love the shoes that child is wearing with the dress???)

AND I believe that JimP's post about how it affects the value of your current contract is also spot on. I am CERTAIN that there will be an appreciable difference in the resale value of an extended contract vs. a non-extended contract TODAY.

Elaine

[NYDVC]

(emphasis added by moi)

In my particular situation, I'm already maxed out in 401K contributions, and save 35% of post-tax income. I own my home -- REALLY own it (no mortgage). I have no debt. What the hell else am I supposed to do with my money? So, I'm not in my right mind because I have earned a good living and am a lifelong saver and chose to exercise the OKW option? Yeah, I'm a :dunce:.

Sweeping generalizations....
lead to some hysterically funny posts, even though I don't think that was your intention!
:ROTFL:

You seem very furgal nono and I applaud you savings, etc. however, from what I see Dave is looking at it from an investment perspective. Just because you have money to spare does not make something a good investment. there are reasons to extend. but none of them seem to make solid financial sense, at least to me. but just like buying into DVC, it is not an investment. You buy it for your life and the added "value" it brings. You may get some of the investment back, even make some if you wait long enough, but overall a timeshare is not an investment vehicle. IMO.

[NYDVC]

sorry...... finished all the threads you guys peaty much said all of my last post, more eloquently then I did. :solikeiwa

[jbrowna]

(emphasis added by moi)

In my particular situation, I'm already maxed out in 401K contributions, and save 35% of post-tax income. I own my home -- REALLY own it (no mortgage). I have no debt. What the hell else am I supposed to do with my money?

Hey, you could always adopt me! :jester: I'd be happy to play the part of the prodigal son and gladly squander my inheritance! :ale: :tilt: :rockband: :cheers2:

[Daitcher]

Hey Dave,

Can we at least agree that this would be a worse spend than an OKW extension:

http://www.eluxury.com/estore/browse/product_detail.jsp?id=11757332

$265 for polyester...

and white!

For a toddler.

$265 for about a 4 hour use-life (till it gets stained and ruined!). Makes those extra 15 years look like a bargain! :magnify:

:slyasafox



You got me there! WOW!!!!! OKW does look like a bargain after that.


DAVE

[Daitcher]

I am CERTAIN that there will be an appreciable difference in the resale value of an extended contract vs. a non-extended contract TODAY.

Elaine



There is and DVC calls it $5 per point yet wants you to pay $15.



DAVE

[Daitcher]

You seem very furgal nono and I applaud you savings, etc. however, from what I see Dave is looking at it from an investment perspective. Just because you have money to spare does not make something a good investment. there are reasons to extend. but none of them seem to make solid financial sense, at least to me. but just like buying into DVC, it is not an investment. You buy it for your life and the added "value" it brings. You may get some of the investment back, even make some if you wait long enough, but overall a timeshare is not an investment vehicle. IMO.



Pretty much.

If a poster comes on herelooking to buy in and has the money, loves Disney, plans to vacation there at least every other year, then yes, I'd say go for it and enjoy the trips. BUT if a poster comes here looking to see if it makes financial sense then I'll give them my opinion, which is it does not UNLESS they will rent to offfset costs.

Same thing goes for the extension at OKW. If you have the money, want to blow it and give it to DVC and you get something out of it,tangible or otherwise, then go for it and enjoy. BUT again, if they want to know if it makes financial sense then I'll tell them it does not anymore. That is it. I'm not here to belittle anyone or tell anyone how to spend their money. There are unique situations of course that may make sense. Take Greenban. He holds a HUGE contract at OKW, 1000 point single contract, I believe. He'll NEVER be able to sell it. Given that situation I can see how he'd be tempted to extend the usage for his family. He didn't care what the value is or will be, he simply chose to extend something he can't get rid of. Makes sense in that situation. He aslso rents and recoupd plenty of cash on his investment into DVC. Nono has the disposable income and he is choosing to dispose of it with something he loves. I'm truly happy for him. He sounds like a guy I can get on board with and have a few drinks with. We all need to enjoy life, period. He sounds like he is doing that. There are amny other scenarios that may make it right for that individual.

My posts are merely for the masses who seek a financial angle. Most of us don't have the money to dispose of and they want to know if this has value. DVC has shown us the value, there is no guess work here. They valued it at $5 per point and are asking owners for $15. Draw your own conclusions.:teacher:


DAVE

[greenban]

I agree totally. :worship: Why are we paying money now for things that we won't have any usage for long into the future? Like, say, retirement investments: good grief, here we are paying money into IRA's and 401K's, and we won't get any usage out of them until we retire! And, God forbid, if we should die before then, all the money (what's left after the government takes its cut) will go to ungrateful relatives or descendants who won't even remember who left it to them! Why not spend that money NOW making memories with our kids and family instead of paying into something that has no usage for who knows how many years?

And what about insurance? Here we are paying tons of cash into something that a fair amount of us will NEVER get anything out of! Sure, if you're careless and get into an accident, or get sick or something, it might pay off. But for the vast majority of us, we'll pay in far more than we'll ever get out of it (that's how insurance companies make money, no?).

Yep, this reasoning is impeccable! I can see how it applies to so many other things in my life..... In fact, I'm going to propose to DVC that all contracts should be no more than two years in length. Anything beyond that, and I'm merely paying NOW for something that won't have any usage for two years -- since I can at least borrow from next year, I can get some kind of usage now for that. But anything beyond that falls right into the reasoning that's been spelled out and is just foolishness. Anybody buying more than a two-year contract must not be in their right mind. :hypnotict

:kickingco The frog is amused, VERY AMUSED!!!! :thumbsup:

Thank you for the smile (I spent the last week painting and epoxy coating our garage, twas not fun!

-Tony

[jbrowna]

:kickingco The frog is amused, VERY AMUSED!!!! :thumbsup:

Thank you for the smile (I spent the last week painting and epoxy coating our garage, twas not fun!

-Tony

Your humble servant is honored to be able to provide some levity in the midst of the Frog's royal responsibilities! :jester: May my unworthy efforts help to lighten the Frog's weary load! :worship:

[Daitcher]

Your humble servant is honored to be able to provide some levity in the midst of the Frog's royal responsibilities! :jester: May my unworthy efforts help to lighten the Frog's weary load! :worship:



I enjoyed it as well, even if it was at my expense. Thanks for the chuckle.



DAVE

[greenban]

I enjoyed it as well, even if it was at my expense. Thanks for the chuckle.



DAVE


That Sir!

Is because besides obviuos intelligence and wit, you have.....


......


......


class!

(And presumably like frogs as well!)

-Tony

[nono]

Just because you have money to spare does not make something a good investment. there are reasons to extend. but none of them seem to make solid financial sense, at least to me. but just like buying into DVC, it is not an investment. You buy it for your life and the added "value" it brings. You may get some of the investment back, even make some if you wait long enough, but overall a timeshare is not an investment vehicle. IMO.


Your point has great value. In my mind, there's a huge difference between an investment and an expense. Vacation is clearly in the expense column in my budget. But, buying DVC (and in this case the OKW extension) is an attempt to spend less overall than what one might spend in total for 50+ separate line items over 50 years. Again, time will tell. Obviously I'm gambling that The Fed will eventually blow it, and we'll be in for some HOOHA inflation years.

BTW, I can't believe no one pointed out to Dave that I'm a chick, not a dude. Dave, my husband says it's hard to tell I'm a woman in writing, 'cause I reference too many things guys do: sports, booze, technology. But, yeah Dave, I'll have some :ale: with you any time our schedules intersect in WDW.

[Simba's Mom]

Personally, I have been rather peeved with Disney regarding the OKW 15 year extension (from 2042 to 2057). First, they called the meeting in Florida with one month's notice. Then, surprise!, at the meeting it was voted to make this extension mandatory unless you file an opt-out which needs to be NOTARIZED!

When I called to complain, I suspect I wasn't the first since the girl said that to make up for my inconvenience I would get $30 off my dues next year. I'll bet everybody gets the $30 off (even the extenders) and since this is the money needed already to run OKW it's just like getting my money back. Leave it to Disney to make us think we are getting something but really we are getting something we have already paid.

I doubt Disney will allow me to get the attendance records from the meeting nor the number of extenders vs. non-extenders. But I was wondering if anybody else has a problem with the methods used here. I'd bet money there will be people who don't read carefully and will be billed for the extension when they don't return the opt-out.

Got a bad taste from this one.

GHD

The problem I have is that our guide called us about 2 months ago to see if we wanted to extend. Yet, now this? They didn't believe us?! I made it clear to our guide that since we'll be in our 90s when the contract originally expires in 2042, we see no purpose in extending it. Let our kids buy their own membership if they want. So DVC had the guides spend their working time to make all these phone calls, then send us this. And we're supposed to pay to get it notarized besides! Yes, this really irks me.

[NYDVC]

. Obviously I'm gambling that The Fed will eventually blow it, and we'll be in for some HOOHA inflation years.



Well, we certainly agree on that point!!!