DVC Resale Pricing Support

[neweagle99]

I feel that with endless DVC point price increases the resale market will be supported... meaning that DVC resale prices will tend to rise moderately over the next several years. Additionally when Grand Floridian and Poly hit the DVC direct market even higher (than now) resale prices will look real cheap supporting and modestly pushing up prices as well. Rental prices will also rise in this "climate".

[salmoneous]

Makes total sense. As direct prices go up, and the gap between direct and resale grows, more and more people should be looking to by resale. With greater demand, prices should go up.

Only problem is that things aren't working that way. Direct prices have been going up. Disney has introduced wonderful new resorts at DLR, the monrail, Hawaii. You would think that resale prices should be going up. But they are going down.

One problem is that the number of resales units for sale keeps going up. As DVC grown, more people sell. Even if demand is going up, supply seems to be going up as well. And that's not going to change anytime soon.

[Caren90]

I believe that certain resorts will continue to hold their prices (BWV, WVL, BCV) but other resorts (AKV,SSR,BLT) that have just recently sold out will see a dip in resale prices. The reason for this dip could be; 1.) Direct buy in costs are high so resales will be significantly lower. 2. Buyers wiping the Pixie dust out of their eyes after a year or two and realizing that DVC is too expensive, or their vacation habits may not be what they had expected.

Stephen

[DougEMG]

Originally Posted by neweagle99

I feel that with endless DVC point price increases the resale market will be supported... meaning that DVC resale prices will tend to rise moderately over the next several years. Additionally when Grand Floridian and Poly hit the DVC direct market even higher (than now) resale prices will look real cheap supporting and modestly pushing up prices as well. Rental prices will also rise in this "climate".

Anything is possible and I could see how a seller would hope this is what is going to happen.

I personally don't think this is what is going to happen otherwise it already would have happened when BLT came online. I don't see any bump up in prices when BLT came out.

The resale market is really more about supply and demand. In general, resale buyers are looking for a deal. All it takes is one seller that needs to sell quickly and willing to take a lower price for that deal to happen. Sellers that want a high price end up sitting on their contract with no action for a very very long time. And with more owners every year the absolute number of sellers that need to sell increases.

In other words I don't think there is much connection between direct pricing and resale pricing.

[OttawaWendy]

I don't think it increased direct prices will cause resale prices to rise. I think it is possible that it will create a bit of a floor though.

It is conceivable that there will be an artificial raise in the average resale point price once VGF appears on the resale market. Those points are going to be sold very high directly and experience shows that some people will want out quickly. The resale price on those is not going to be equal to the present average resale price. But that won't change the prices on the other resorts.

[OttawaWendy]

Originally Posted by Caren90

I believe that certain resorts will continue to hold their prices (BWV, WVL, BCV) but other resorts (AKV,SSR,BLT) that have just recently sold out will see a dip in resale prices. The reason for this dip could be; 1.) Direct buy in costs are high so resales will be significantly lower. 2. Buyers wiping the Pixie dust out of their eyes after a year or two and realizing that DVC is too expensive, or their vacation habits may not be what they had expected.

Stephen

It is my impression that BWV has actually fallen quite a lot recently in percentage terms. When we were first looking (I think in 2006), BWV was up with BCV and VWL, but it is significantly lower now.

[Sir Aaron]

I think certain resorts that have higher demand will fetch higher resale prices. VGC is a good example and I'm guessing so will VGF.

I don't think resale prices are related to direct prices because few people know about resale so the buyers in the resale market are limited.

[jedwards]

I dont think the resale prices are effected by direct sale pricing in general.

[bdoleary]

I think the cost of new direct purchases plays a role for resorts that aren't sold out yet and are still being actively marketed but the primary driver is supply and demand. (AKV is a great example)

Another factor is the fact that many of the resorts will expire in 2042 - this should cause their value to continue to depreciate - as their Use Years are used up.

[kylet13]

Originally Posted by bdoleary

Another factor is the fact that many of the resorts will expire in 2042 - this should cause their value to continue to depreciate - as their Use Years are used up.