Disney Vacation Club-Direct vs. Resale?
This Blog summarizes the advantages and disadvantages of buying a DVC timeshare directly from Disney or an existing owner through a resale agent. Contracts purchased from Disney will usually be higher than ownership purchased from a current member. Over time, Disney has tried to lessen the advantages of lower-priced resale contracts in the marketplace by restricting the use and benefits. Disney has increased restrictions on three separate occasions in the last ten years, potentially making Resale less appealing. When the reason that you are buying a DVC contract is to be able to take a lifetime of excellent vacations at luxurious accommodations, you need to understand all of the ins and outs of your purchase, especially when the initial cost is so high.
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Initial Cost
The most significant advantage that a resale purchase has over buying direct from Disney is the initial cost. Cost savings of 5%-35% over direct pricing is tempting to potential owners, especially when the initial price is thousands of dollars. The initial cost savings is the primary reason that owners purchase from other owners and not from Disney. The chart shows the current resale DVC listing per point at the DVC resale sites tracked in the DVC Field Guide Resale Index.
Annual dues (maintenance costs) are set each year based on the home resort of your contract. For both contracts purchased direct or those from Resale, the annual dues are the same.
Restrictions- March 2011
Disney began its era of resale contract restrictions by limiting DVC use on resale contracts purchased after March 21, 2011. The constraints were issued on January 18 of that year. Until then, there were no resale restrictions on DVC ownership. With this mandate, Disney vacation points from resale contracts could not be exchanged for trips with Adventures by Disney, book non-DVC club hotel rooms at Disney theme parks, or vacations on Disney Cruise lines.
The official notice was sent out on the DVC website by David Van Buskirk:
Direct Purchase Benefits Dear Sir or Madam;
From time to time, you may be offered Incidental Benefits (as defined under applicable law) or other benefits. These products and services may not be transferred, except upon written approval of DVD, and may be limited, modified, supplemented, or terminated at any time. If you sell your Ownership Interest, these products, benefits and services do not automatically transfer to your buyer. Beginning March 21, 2011, Members who purchase their Ownership Interest in any DVC Resort from a person or entity other than directly from DVC shall not be able to use the Vacation Points associated with that Ownership Interest for reservations or stays through the Incidental Benefits known as the Adventurer Collection, Concierge Collection, or The Disney Collection. Do not purchase your Ownership Interest in reliance on your ability to transfer these products, services and Incidental Benefits if you sell your Ownership Interest or based upon their continued availability. Please refer to the Member Benefits Guide for terms and conditions.
David Van Buskirk
Disney Vacation Club
The impacts of the limitations on vacation points were hardly severe. The value of using vacation points for Disney cruises, Adventures by Disney, and non-DVC resorts are not the best use of vacation points anyway. In most cases, the economics would support renting out your points and using that money to purchase one of these vacations yourself. The better use of your points is on DVC resorts, and that was not restricted.
Restrictions- April 2016
Disney continued its DVC restrictions on resale purchases by limiting incidental benefits that members receive. These perks include discounts on dining and merchandise, annual passes, and member-exclusive events. As you know, perks are not guaranteed, but members have grown to expect these benefits since they have been in effect for some time. Effective April 4, 2016, Disney eliminated membership extras from resale contracts.
President Ken Potrock announced the following:
Dear Disney Vacation Club Member,
Our goal at Disney Vacation Club has always been to create magical experiences for you and your families – experiences you simply can’t find anywhere else but Disney.
As our Member community continues to grow, we want to make sure we can continue to deliver the Membership Extras that add value to your overall experience – offerings that are provided as a premium advantage to our Members who purchase directly from Disney Vacation Club.
With that in mind, please be aware of a policy change regarding the availability of Membership Extras to our membership. As previously communicated (effective March 21, 2011), Getaways included within the Disney Collection (e.g., Disney Cruise Line and Adventures by Disney) and the Concierge Collection, which are now part of Membership Extras, have not been available for ownership interests not purchased directly from Disney Vacation Club. Now, effective April 4, 2016, Members who do not purchase their ownership interest directly from Disney Vacation Club will not have access to other Membership Extras, such as exclusive Member experiences and discounts. Please know that as a current Disney Vacation Club Member (regardless of when or where you bought your membership), your access to Disney Differences and these additional Membership Extras will not be affected by this policy change. For more details about our Membership Extras program, please refer to our Membership Extras Acknowledgment and Disclosure Statement available on line at disneyvacationclub.com.
We see this policy change as a very positive step to ensure that, going forward, our Members who purchase directly from Disney Vacation Club receive a premium advantage – in addition to all the magic that Disney has to offer.
Speaking of membership advantages, you’ve probably heard about the exciting Membership Extras introduced as part of the Disney Vacation Club 25th Anniversary. With this celebration, we’ve created unprecedented and exclusive Disney experiences for you and your family. In fact, just weeks ago, nearly 16,000 of you were able to enjoy the Disney Vacation Club 25 and Beyond Bash at Magic Kingdom Park. Meanwhile, more than 10,000 Members have entered our Disney Vacation Club Silver Anniversary Sweepstakes, and thousands of you have booked the Member Cruise sailing from New York later this year.
In the coming months we’ll be bringing you even more spectacular Membership Extras as part of the anniversary, from exclusive merchandise and one-of-a-kind events (including exciting plans for the West Coast) to an all-new Member Lounge opening later this spring in the Imagination! Pavilion at Epcot. And there’s so much more Disney Vacation Club fun on the horizon!
Thank you, as always, for being part of the Disney Vacation Club family – a family we are proud to serve. We look forward to welcoming you home again soon!
Sincerely,
Ken Potrock
These perks are discussed in more detail in a separate chapter. Food discounts using DVC membership can vary but is usually 10% when offered. However, owning DVC is not the only way to get these savings. Members who have annual passes or Tables In Wonderland cards (Note: currently Tables in Wonderland card purchases are paused) can get similar discounts. Annual passes provide similar meal values. Tables in Wonderland cards can also be purchased and include savings of 20%, including alcohol. For merchandise, discounts are usually 10-20%. Again, annual pass discounts will be comparable to DVC savings.
The mandate eliminated certain member events for Resale owners only. Currently, these include Disney Member Cruises, Moonlight Magic, and Movie Screenings.
Just like the restrictions in 2011, there were no limitations on using vacation points. All vacation points were still good for all DVC resorts and RCI exchanges (Changed to Interval International in January 2022). Disney needed to define how many direct points would be required to qualify a member to get these savings and attend these events. Initially, DVC members only needed 25 points to get these savings. That was the minimum points Disney would sell in a DVC contract. However, over time the points required changed to 150 accumulated direct points to get these benefits.
Is it worth buying your next DVC contract direct from Disney to get these savings? As mentioned earlier, most of the merchandise and food discounts can be acquired at the parks and Disney shopping areas by having an annual pass. However, for buying an annual pass, Disney currently offers the Florida resident Sorcerer Pass to all DVC members. The passes are only restricted at Thanksgiving and Christmas and offer a discount of several hundred dollars annually. For frequent visitors, where an annual pass makes sense, the savings of buying a higher-priced contract from Disney may be offset by the annual pass savings. (Note: Annual Passes sales are paused at this time).
Restrictions- January 2019
Disney’s resale restrictions announced for 2019, was the most significant of any resale limitations and gave us a glimpse of how Disney will deal with Resale in the future. In January 2019, Disney restricted resale contracts so that future resale owners at the existing 14 resorts will only use their points at these resorts. Prospective resale owners at Disney’s Rivera Resort or Reflections-A Disney Lakeside Lodge (Current construction startup date unclear) will only stay at those resorts and not at the remaining resorts.
The impact on resale pricing is not known at this time. There are few resale contracts on the market for Riviera, and Reflections hasn’t been built. Over time, I suspect that the resale value of the new resorts will be low to reflect the resale restrictions placed on the property. On the other hand, Resale at the other existing 14 locations continues to be healthy. Even though the Riviera has a significant draw with direct Skyliner transportation to two theme parts, the original 14 have location advantages and offer more location flexibility for its owners.
Effective January 19, 2019, only Members who purchase directly from Disney will be able to use their Vacation Points at the 14 existing Disney Vacation Club Resorts or future Resorts—such as Disney’s Riviera Resort or Reflections – A Disney Lakeside Lodge. Resale contracts purchased for the existing 14 Disney Vacation Club Resorts will only be able to exchange Points into those 14 Resorts.
This change does not apply to contracts purchased prior to January 19, 2019. Contracts gifted to family members will continue to have the same Resort access as before the ownership transfer.
The eligibility rules for Membership Extras and RCI access remain unchanged.
The Buena Vista Trading Company Disclosure Guide has been amended accordingly.”
Summary-Advantages To Buying Direct
Buying a DVC contract direct from Disney or through Resale both have advantages. For direct from Disney, these advantages over Resale transactions are:
1. Owners can have vacation access to all Disney locations, all member benefits, Disney Cruises, and Adventures by Disney tours. For Resale, there are restrictions.
2. Owners can get the exact number of points/contract size/use year at the new location(s) that Disney is marketing. Resale owners have limited inventory to new sites.
3. Owners can get these properties fast, even on the same day.
4. No ROFR for older contracts. Potential owners who buy direct at older resorts will be put on a waitlist while Disney searches for the property. The resale process can be derailed if Disney makes a right of first refusal offer, causing the potential owner to start the purchase process over again.
5. Easier financing. Disney will accept cash, check, or credit card for the purchase. Disney financing rates will vary based on your credit score.
Summary-Advantages To Buying Resale
For Resale transactions, the advantages over direct are:
1. The initial cost will be lower. Cost savings of 5-35% can result in sizable initial cost savings over buying direct.
2. Final sale price can be negotiated with the prior owner. Unlike Disney direct, where the price is fixed, the elements of the contract can be arranged. This includes who pays for the maintenance and closing cost.
3. Resale contracts are visible on line at various resale sites. Potential owners can easily view the inventory.
4. Pickup of Banked points- Owners who have not used the current points may be able to bank them, creating a windfall of points initially for the new owner.
5. Stripped Contracts-Owners looking to purchase a resale contract but don’t need the points may find that a stripped contract with little or no current points available may offer an even more reduced purchase price.
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