Even we have to admit that it is rare for us to compliment a timeshare developer but we make an exception for the Disney Vacation Club (DVC). Virtually across the board, timeshare ownership loses most of its value before the ink is dry on the contract, not so Disney points. In the quest for transparency it’s fair to say that on selling Disney points there must be an expectation that there will be a loss against the purchase price but not by a significant amount, as we will demonstrate below.
Singling out one of the DVC popular resorts being Disney’s Grand Floridian Resort & Spa, new points are currently selling for an average of $255 each. According to the DVC resale division, depending on time of year points at Grand Floridian are selling for between $156 and $185 per point. Buying “new” points does have advantages over resale points; we will look at this later.
How much will it cost to buy in?
The cheapest option at Grand Floridian is the studio that sleeps 5. In the high summer season a one week purchase with a lake view requires 192 points, so 192 points X $255 = $48,960 (£35,500 approx). Annual maintenance fees for 2021 are currently $6.81 per point which means the fee for this year is $1,307. This represents a 3.81% increase over the 2020 fees.
As a non owner, to book directly at the Grand Floridian for one week in July costs $6,300 for two adults and two children. Factoring in the purchase price and maintenance fees rising by 4%pa but with a static price for an external booking, it is possible to have up to 9 holidays before ownership becomes a cheaper option.
New or resale?
As we stated earlier there is a payback to be gained by buying “new” points straight from DVC. Buying DVC points directly from the Disney comes with a number of benefits for new owners, including extra hours at the parks, dining discounts, access to Disney cruises and owners lounge entry at EPCOT also included is access to international resorts. These perks are not available to owners who solely buy their points from the resale market.
When comparing new or resale, the 192 points required at best would cost $29,952 up to $35,220 so for the additional benefits buying direct from DVC would appear to be the better option. Below are DVC charts showing resale values over the past 12 months and a comparison new sale and resale cost chart both produced by DVC.
Transparency
We have been most impressed with the information imparted on the DVC website. They publish annual maintenance fee costs, also points charts for the various resorts which clearly states the cost in points terms for various purchase options and season times, none of the varying price game that happens with other developers.
If you explore the DVC site there is also a calculator that is personal budget driven. You put in how many points you require, the resort and you will be given a full quote including closing costs and an example of costs over a 10 year finance period which may be downloaded as a PDF. An example may be downloaded below, it even includes maintenance fees paid monthly, pretty good stuff eh?
How have Disney got it so right?
In short, Disney’s brand power extends to DVC timeshare resorts. And though DVC’s annual inflation sits higher than most resort developers for both points (5-6%) and maintenance fees (3-6%), its ever evolving attractions continue to make DVC one of the most dynamic timeshare developers in the industry. While DVC is certainly not unique in offering spacious accommodations in prime resorts, the power of the Disney brand buoys resale value for owners looking to exit their ownership. What that means is real liquidity in an often stagnant secondary market.
We think you will agree that everyone who has visited a Disney theme park is in awe of the creativity and fantastic holiday experience. Couple this with the fact that the Disney holiday experience is forever evolving with no expense spared, add to this luxurious resort accommodation it’s easy to see that buying a slice of Mickey Mouse is as popular now as it has ever been.
Home resort system
A word of caution, DVC still employ a “home resort” system which means that the maintenance fees are payable to the resort where you purchased. Some resorts have a lesser point requirement for holidays but the maintenance fees may be higher. For example, in the chart above, new points at Vero Beach are $120 per point compared with Grand Floridian at $255 but the 2021 maintenance fee at Vero Beach is $11.21 per point compares $6.81 for Grand Floridian.
Balancing purchase price against ongoing costs should be taken into account especially when looking at the increase in maintenance fees. From 2020 to 2021 both resorts saw an increase, in the case of Grand Floridian the increase was 3.81% for but for Vero Beach this was a whopping 10.91%.
Given our research DVC, whilst probably more expensive than some other developers, appear to offer a lot more bang for the buck. The clarity of purchase price and ongoing costs is also a plus, no smoke and mirrors here! The booking system takes a bit of getting used to but once mastered works fine. We are in no doubt that the current pandemic will continue to cause disruption in bookings at DVC but this is no different than other developers are experiencing.
Like all long term financial commitments you must do your homework thoroughly before signing on the dotted line. With a purchase in the USA transatlantic air fares and other costs beyond accommodation must be factored in. That said, DVC also offer points based holidays throughout Europe and other destinations. Examples may be found here.
If the current trend continues, when it’s time to say goodbye to Mickey, Minnie, Goofy and friends, there is a good chance that you will receive a fair sales value for your points. That said timeshare should never be purchased as an investment product. The value of DVC points may fall as well as rise and there is no guarantee that you will get your money back but one would hope in the meantime you have had some amazing holidays. We certainly believe that other timeshare developers and resorts could take a leaf from the Disney book. Whilst Disney makes wonderful fairy stories, they certainly don’t tell them when it comes to their timeshare business.
For more information regarding this article or assistance in any other timeshare related issues please contact the TCA on 01908 881058 or email: info@TimeshareConsumerAssociation.org.uk