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Old 01-18-2011, 06:16 PM   #1
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New Policy Announced for Re-sale Purchases

From DVCmember.com

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Disney Vacation ClubŪ 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 RCIŪ 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.
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Old 01-18-2011, 06:17 PM   #2
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From the Orlando Sentinel:

Quote:
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.
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Old 01-18-2011, 07:06 PM   #3
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This will slow down direct sales also. It will make it harder for those who need to sell their points to do so.
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Old 01-19-2011, 01:26 AM   #4
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Thanks for the heads up. I'm not surprised at this, as Disney are obviously keen to take more of a foothold in the resale market.
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Old 01-19-2011, 07:04 AM   #5
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I know they are doing this to increase direct sales but I wonder if it will really help. I would think this new policy will have an effect on resale prices. Would you really want to spend $110-$120 per point or more knowing the great losses you would take should you have to or want to sell? We don't care about cruises, the other collections they offer or trading our points through RCI because its not the best use of points for the money. We only stay at Disney resorts so if the resale prices dropped it would be in my best interest to purchase more points resale. This could get interesting.
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Old 01-19-2011, 09:10 AM   #6
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Wont stop me from buying resale. I never use my points for anything other than staying at DVC.
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Old 01-19-2011, 09:34 AM   #7
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Thanks for the post. I was frustrated by the Orlando Sentinel article because it did not address the question of grandfathering previous resales.
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Old 01-19-2011, 09:51 AM   #8
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Thanks for the info.

I really dont see this as too much of a hassle. As others have stated it not the best use of pts. Now more ppl will look toward renting pts and paying cash for such excursions. If this were to limit trading through RCI then I could see an uproar.
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Old 01-19-2011, 03:05 PM   #9
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"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."

Doubt it. DVC probably got tired of answering the question "Why should I buy new at $110 a point from you instead of $70 a point at resale?"
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Old 01-19-2011, 03:51 PM   #10
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"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."

Doubt it. DVC probably got tired of answering the question "Why should I buy new at $110 a point from you instead of $70 a point at resale?"

The salespeople (AKA guides) will now be able to come up with an answer on why someone should buy from them. Before they danced around it or said the low offers will not pass ROFR which is not true most of the time. If buyers do their research I think they will still find resale to be a much better value.
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Old 01-19-2011, 03:56 PM   #11
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Originally Posted by RobDVC View Post
"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."

Doubt it. DVC probably got tired of answering the question "Why should I buy new at $110 a point from you instead of $70 a point at resale?"
I'm sure both are true. Obviously this would never have happened if it didn't serve DVC's own interests. But I'm quite certain direct buyers have often asked for some form of differentiation over resale buyers.

I was at the DVC annual meeting last month when a member stood up and questioned why she didn't get extra perks as thanks for owning 1600 DVC points. And that member was applauded by some in the audience!

The phrase "it takes all sorts..." would seem to apply.
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Old 01-19-2011, 04:07 PM   #12
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Don't think it's fair that they are going to start treating people who want to save some money (so they can buy more points) like second class citizens. The points get me there and I still spend a boatload of money.
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Old 01-19-2011, 10:13 PM   #13
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Don't think it's fair that they are going to start treating people who want to save some money (so they can buy more points) like second class citizens. The points get me there and I still spend a boatload of money.
I have to agree with that. If I was looking to buy a home, I would still get to live there whether I bought an existing home or built a new one. If I bought an existing home, the original owner wouldn't be able to tell me "Well, you didn't buy from me, so therefore, you can't use the garage." I don't want to start a controversy here, but I feel pretty strongly about this. DVC already made the money on the sale, and lets face it, if someone is selling a contract, its for a very good reason. Perhaps they can no longer afford to go to Disney, maybe there was a job loss or illness, and they can no longer use the points. So now, DVC is making the sale harder on people that already might have a financial hardship. And yes, I think the resale market will go down because of this.

Don't throw tomatoes, it's just my opinion.
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Old 01-20-2011, 09:00 AM   #14
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I have to agree with that. If I was looking to buy a home, I would still get to live there whether I bought an existing home or built a new one. If I bought an existing home, the original owner wouldn't be able to tell me "Well, you didn't buy from me, so therefore, you can't use the garage."
No tomatoes intended but I do think that's sort of an imperfect analogy. The trading options involved aren't contractually guaranteed--they are actually perks that DVC arranges for/provides to members. Really it's not much different than the Annual Pass discount or free Internet.

If you want to use a house analogy, you'd have to think about something provided by the developer which isn't part of the deeded property ownership. Let's say that a builder agrees to pay for free lawn care for as long as that buyer owns the house. That sort of perk is unlikely to be passed along to the second and third owner of the property because the developer doesn't have anything to gain by those additional transfers in ownership.

Perhaps a better example would be a car purchase where the dealer provides free oil changes for life. It's a dealer perk given to the original buyer--their customer--but they aren't going to continue giving free oil changes when ownership of the vehicle is transferred.

It's a tough situation for Disney to be in. Prices on the resale market have fallen off markedly in the last couple of years. Part of the reason is supply--the more Disney sells, the more the resale market will naturally grow. But the economy hasn't helped.

Disney not only has to consider the well being of members but they have an obligation to shareholders to maximize ROI. When DVD develops a plot of land right next door to the Magic Kingdom or spends $120 million on land alone in Hawaii, they're sort of obligated to maximize the return on those investments.

As an owner, I'm more concerned that DVD may someday reach a point where they cannot financially justify building additional resorts. I know we all see billion-dollar profit reports from Disney and think that all is well. But each division, including DVC, needs to pull its own weight. And if Disney reaches a point where they no longer get sufficient return from DVC point sales, they'll get out of the market. Consider what will happen to resale values and member perks if THAT happens.

I'm not terribly thrilled with the decision, but seeing both sides of the argument I'm not sure what I would have done differently. These changes are modest in comparison to some of the (unsubstantiated) rumors that were floating around involving different resale booking windows and such. In DVD's eyes, every customer who buys resale is a lost customer, and I just don't know what else they could do to compete with some of today's resale prices.
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Old 01-20-2011, 06:12 PM   #15
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A thoughtful post, Tim. Thanks.

Unless I buy resale again or attempt to sell my contracts, I guess I am covered, because I did buy partly with the idea of using points for cruises and ABD tours. I am aware that this may not be the most cost-effective use of points, but I can envision a situation where I may not have the ready cash, but I have the points to cover it. Yes, I suppose I could rent the points, but I am hesitant, to be frank.
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