DVC Deals…And Why You Should Wait
Disney Vacation Club has resumed sales, and is offering its lowest prices ever on Riviera Resort, plus deeper discounts than normal on Copper Creek Villas at Walt Disney World and Aulani in Hawaii. In this post, we’ll take a look at the deals, and offer commentary about why we still would not recommend buying into DVC right now.
As a “Welcome Back Home to the Magic” special (you must be logged in to view the details), Disney Vacation Club is offering sales incentives offer savings up to $40 per point at Disney’s Riviera Resort, Copper Creek Villas & Cabins at Disney’s Wilderness Lodge (which is 96% sold out), and Aulani – A Disney Resort & Spa in Hawaii.
For a limited time, you can save $3,750 or more when you add-on 150 points or more at these three resorts. As is normally the case, the more points purchased, the more you can save. Add-ons of 300 to 499 Vacation Points will result in savings of $12,000 to $19,960, or $40 per point. That’s the best “deal” ever offered at Disney’s Riviera Resort, besting even the original pre-opening discount. These savings end September 16, 2020…
With the details of the current DVC deals out of the way, let’s turn to whether you should take advantage. A few friends and readers have asked whether now is a good time to buy into Disney Vacation Club. Our answer has been an unequivocal “absolutely not.”
What follows is why we’d wait–keep in mind that much of this is totally our opinion, highly speculative, and based on some assumptions. As always, your views and mileage may vary. (Additionally, none of this takes into account the still-newish DVC resale restrictions, which prevent us from ever recommending buying in with Disney’s Riviera Resort as a home property at all, ever.)
First, one thing we know is that the Walt Disney Company has raised roughly $20 billion in new debt offerings since the parks closed. Moreover, in Disney’s latest quarterly earnings call, the company revealed that profits were down 91% and the closure of the theme parks alone cost Disney $1 billion in lost revenue, with $30 million lost each day the parks remained closed. That was last quarter when the domestic parks had only been closed for a few weeks–the current quarter will be even more of a bloodbath.
Second, another thing we absolutely know is that Walt Disney World has been closed for the last several months, meaning that in-park Disney Vacation Club marketing and transactions ceased. Sales levels predictably bottomed out during the closure; per DVCNews, the combined total sales from April and May were less than the previous single-month low of the last decade.
Third, when Walt Disney World’s theme parks reopen on July 11 and 15, they will be doing so at 20-30% of normal capacity. They will also be disproportionately frequented by locals and Annual Passholders, as the majority of Walt Disney World resorts remain closed. None of these first three points are speculative; they’re objective realities.
This means that when Walt Disney World’s theme parks do open and Disney Vacation Club presumably resumes in-park sales, they will be doing so with roughly 20-30% of the foot traffic and to an audience–predominantly Florida locals–that disproportionately is not interested in the product they’re pitching.
This is not to say no one will be buying. Diehard Disney tourists are an easier sell for DVC, and that group will also be present when the parks resume operations. Moreover, Disney Vacation Club members will be a large reopening demographic, and there’s likely some degree of pent-up demand for add-ons among this group. (Resale results for May partially bear this out–but could also be explained away by the fact that there was no competition via direct sales.)
However, it’s hard to envision sales numbers for August through November 2020 being even remotely on par with their highs of last December through this February. There are fewer potential buyers, the ones that are in the parks aren’t the normal primed tourists, and there’s still considerable economic uncertainty (and that’s putting it charitably).
This brings us to the matter of market sentiment. Who is more motivated to act right now–the seller or buyers? Is the company that has been hemorrhaging cash and taking on billions in debt more eager to move points, or are the consumers who have been hit by the dual blows of an unprecedented health crisis and recession more eager to buy? (That’s rhetorical.)
Economists are warning of a collapse of demand in the market, which is only beginning to hurt major segments of the economy that are experiencing plunging sales. The lagged effects of this demand shock could take months to be felt in full. During past recessions, consumers first reduce their expenditures on nonessentials and luxury goods.
As much as fans might view Walt Disney World as “essential,” timeshares fall squarely into this category. As an anecdotal point, we bought into Disney Vacation Club during the peak of the Great Recession, and that was the lowest price we’ve ever seen DVC. (Disney Vacation Club contracts expire, and should decline in value. Ours appreciated tremendously in the decade that followed.)
From a rational buyer’s perspective, there’s ample reason to hit the pause button on a new Disney Vacation Club purchase. The memory of the parks and resorts closing should still be fresh in mind for a few months or more.
Even if you think it’s highly unlikely that the parks and/or resorts will close again, you should at least be cognizant of the possibility that a second wave will cause subsequent closures. Some prospective purchasers will have near-term trepidations about buying a product they may not even have access to in the next year or so.
The possibility of subsequent closures is not the only way prospective Disney Vacation Club buyers might be denied access. In our Disney Vacation Club’s Point Pool Problem, we discuss how one ripple effect of the closure will be reduced room availability.
This very much remains an ongoing issue. Even now with the DVC resorts having reopened, fewer members are attempting to use points for June through September. This compounds the problem of points not being used during the closure, and means a disproportionate number of members will be trying to use their points for October and beyond–with “beyond” stretching through the entirety of 2021.
In other words, if you buy now, plan on booking at your home resort right at the 11 month mark, or maybe Saratoga Springs/Old Key West at the 7 month mark. Inside of 7 months, it’s going to be slim pickins’ at other properties in late 2020 and 2021.
The good news is this is a near-term problem–and it’s one that Disney Vacation Club and Walt Disney World could still remedy. (To be sure, it would be in their best interests to come up with a solution, as the tidal wave of complaints that will hit in the next year will almost certainly impact sales.)
However, it’s a problem nonetheless and one that would give us great pause about buying in the near future. (Fearing this exact scenario, we’ve already made more bookings than normal for this summer and fall, knowing we’ll have more difficulty using points this Christmas and in 2021.)
Even with that in mind, we are interested in purchasing more Disney Vacation Club points, potentially late this year or early next if a buyer’s market emerges. Since we have zero interest in Disney’s Riviera Resort with the aforementioned restrictions, we’ll be looking to the resale market.
We hesitate to offer predictions on that front, but our expectations is that an increase in foreclosures and reduced use of RORF, plus owners forced to sell, will depress per point prices on the resale market–but time will tell.
Ultimately, this is all to say that it’s unlikely we’ve seen the last–or best–of Disney Vacation Club’s discounts. There’s a desire to increase revenue after months of anemic sales, the ongoing financial woes of the Walt Disney Company, economic uncertainty, plus the lagging effects of a recession.
In totality, all of this presents considerable headwinds to Disney Vacation Club sales in the near future. Even if you don’t agree with every conclusion we’ve reached here, it’s unlikely you’ll dispute all or even most of them. And if you do, there’s still no harm in waiting until September 15, 2020 and either making a purchase then or holding off for better discounts if some of these predictions are already starting to come to fruition.
Thinking about joining DVC? First be sure to read our Ultimate Guide to Disney Vacation Club. This covers the pros & cons, resale v. direct, how much money you’ll save, and other important things to know before taking the plunge. If you still can’t decide whether membership is right for you, “try before you buy” and rent points from DVC Rental Store. If you are convinced a membership is for you, check out the discounted options at DVC Resale Market. Planning a Walt Disney World trip? For comprehensive advice, the best place to start is our Walt Disney World Trip Planning Guide for everything you need to know.
Do you plan on purchasing Disney Vacation Club points in the near future? Think this “Welcome Back Home to the Magic” deal is as good as it’ll get, or will you hold off for something better? Think DVC will offer more aggressive discounts to help offset months of virtually no sales? Any other reasons you would or would not purchase right now? Had trouble finding DVC availability for later this year? Do you agree or disagree with our assessment? If you’re an existing Member, what do you think? Share any questions, tips, or additional thoughts you have in the comments!
Gina: “We are on the cusp of buying into Copper Creek directly because my husband is leary of any future restrictions that may come about in regards to restrictions .” Hopefully you aren’t buying CCV for studios because they can be very hard to book at anything less than 11 months out, right at 8AM ET. Both studios and one bedrooms only sleep four (and two bedrooms sleep eight), but the Cascade Cabins are really, really nice.
Hi Tom ,
I follow you religiously.
We are on the cusp of buying into Copper Creek directly because my husband is leary of any future restrictions that may come about in regards to restrictions .
Would love to hear your thoughts about sales at the moment ?
And one more time your thoughts on direct or resale ….
thank you !!!
I waited to buy after reading this, and now prices are way up….are you thinking prices are going to fall at some point? Seems DVC prices have only gone higher and higher.
The economy and travel industry both bounced back far faster than anyone expected. At this point, a prolonged recession–or even a mild downturn–is incredibly unlikely in the near-term.
Prices could drop at some point, but I’d no longer recommend waiting for that to happen. If it does, it won’t be driven by the closure and reopening–it’ll be further down the road.
What’s your thought on the timing now?
The price just went up per point. It’s not going down.
Hi! I know it may be a weird time to get into DVC, but we have recently (as in the last week) started looking into joining DVC via the resale market. We have only been on one WDW trip as a family, but we had another one planned 7 months after (in May 2020) that got cancelled. We plan to go to WDW at least once a year, and have an infant and a 3 year old. I’m torn because on the one hand I want to wait and do as much research as possible, including renting at a DVC resort to test it out, but I also want to take advantage of the prices while they’re low. Any suggestions for this predicament?
Book a couple of DVC studios for your trip using the new discount and cash via Disney Reservation Center. But with a split stay, you’ll have some time where you will be homeless between your two reservations. However, you might have a better chance at getting into your new studio more quickly since there seems to be vacancies so that villas are turned over more quickly
For more information on DVC the DIS Boards are a good information source, especially the DVC boards. Also Mouseowners.com.
Tom, do you think DVC will rescind the resale restrictions on Riviera in light of lagging sales, Reflections cancelled/postponed, and it now being the odd man out to the other legacy properties? We actually love Riviera and want to buy a direct contract at Copper Creek, but we’re not buying anything unless we stand a chance of USING the points. Why buy in, even on sale, if your points will go to waste for the next year or two? IDk how they will handle the expiring/overflow of accumulated points.
I flirt with the idea of DVC ownership, but it never seems to work out financially. Can someone tell me if Disney does direct resales at older resorts? The DVC website seems to indicate that they are only selling Riviera and Copper Creek, but I have seen comments about Disney exercising their first right of refusal in people’s resale attempts. If Disney does directly sell at all resorts, does anyone know what their prices are like at the less expensive resorts, i.e. Saratoga Springs?
I have spoken to Disney about Bay Lake and their prices are much higher than resales from other sellers. The expiration/terms are the same so you don’t get more years.
Yes, you can buy direct at any resort. Here’s one direct-cost-per-point chart:
There are plenty of analyses available regarding DVC financials. My $0.02 is we did not purchase for the “value”, we did it simply b/c we wanted to and were able to afford it. It’s not an “investment” nor does it offer much of a saving proposition for us (though, it might… don’t know, don’t really care). It takes a lot of projections/assumptions for it to work out as a savings, but I’m sure plenty of people have anecdotes about their own experiences and how membership has saved them $$$.
Becoming a DVC member is the best thing we have ever done for our family! We have been to Disney 1-2 times a year since we joined in 1998, been on 14 cruises, and even did an Adventures by Disney tour. This was easy enoughsince we have 1700 points. Sometimes we brought the kids and grandkids, sometimes we went by ourselvesWe started in 1998 with 200 points. When we had some spare cash, we would purchase more points. That way we had no loan to pay off. We think this method of buying points worked well for us and would probably work for you too.
Prices will go down with demand and will not go up again until economy is out of recession and covid is conquered. It will take a while for both to happen.
The restriction against borrowing points that is in place right now seems like a bad idea considering the availability. I had to go from 5 night AKL in May to 3 night AKL + 2 night Dolphin thanks to not being able to borrow my Dec 2020 points after the first ressie was cancelled. In hindsight would have made sense for that change to not go into effect until at least Christmas.
Dixie, I’m in the same boat as you! I will NEVER rent DVC points again. In January I booked for September 2020 at Bay Lake Tower. First and last time renting points. Even if I thought it was safe enough to go (which I don’t), the border will still be closed, Disney World tickets aren’t being sold, there’s no guarantee we’d be able to get park reservations if they do start selling tickets, there are few flights and I live too far to drive, and we’d have to quarantine for 14 days when we got back. The broker wants me to pay the remaining balance 45 days in advance of the check-in date, and if the border is closed, they will give me a credit. But I have no faith the broker will be able to remain in business, so I’m not paying the remaining balance. I’m going to be out the $1600 deposit. Lesson learned. I’ll only book directly through Disney from now on.
I think letting your deposit go is unfortunate but also the smart choice. We paid in full already so will have to hope for a credit + that the broker doesn’t fold. After reading the attitude of many many owners on disboards I would also not ever book direct after this. I personally don’t think owners should be confident the rental market will be as strong as it used to be. Only time will tell though!
We’re interested in more points (we bought our first resale contract earlier this year) but will wait to see what happens to resale prices. We’d also consider the smallest possible direct add-on just to get the benefits but we’ll see if Disney comes out with better deals. The current deal is still SO much more expensive than buying resale.
This is a question I’ve noodled around too… is it worth buying add-on direct for the “perks”? While I did not base my initial DVC purchase entirely on the dollars and cents, the perks seem decidedly NOT worth it compared to saving as much as 40% (several thousand $$$) buying resale vs. direct.
Anyone else of a different opinion?
We currently own at Grand Californian and have been setting aside money to buy a WDW-based contract. We hadn’t planned on buying for a few more years (young kids) but if this is like the last recession and we end up with $80pp for AKL or low $100s for BLT or VGF… well, we may pull the trigger. Do you think there’s any chance they’d drop the resale restrictions at RIV the way things are going?
Based on my buying/selling Disney will buy the contract and not let sales go that low.
My home resort is AKL purchased through Disney. If I add-on at some point via resale, how would any of the resale restrictions work since I will have a mix of points?
You new resale points would be held separate from your direct points and could not be used to book RIV (or any newer resorts) or be used for the Disney Collection. You could use them to book the 14 legacy resorts at seven months out. They would not be eligible for Membership Extras. So if you booked a stay on the resale points and there was a member event during that time period, you would not be eligible to attend the event.
Thanks for that update. It sounds like those restrictions are going to hold back sales there.
Tom, it seems like this advice to wait is mostly geared toward a direct purchase, although you did mention that resale contracts may be depressed in the winter. I am eyeing a 200 point SSR resale contract for my family of 4 and it would be our first DVC purchase. Trying to decide whether to wait or take the plunge now. I would hate for prices to go up before I buy in, and the contract I am looking at is a great fit for us. Are you, or is anyone else, noticing any trends in the resale market that indicate whether to buy now or wait? Or even in the direct market?
Bethany, end of the year is probably a good time to buy since a lot of members are trying to unload before annual fees are due in January. If the price is right, the points are right, the resort is right and the UY is right, go ahead and buy. Good luck with your decision.
I’ve run the numbers on DVC over the years and it never worked out for us with our vacation style. But if I’d factored in that an $85/pt AKL point would be worth $110-115 only a few years later, that math might have changed.
Question, SO if your a DVC member right now, want to book at the 11 month out for Sept 2021, What are the chances of getting park passes???? If Hotel Packages go on sale on the 28thm, these people can make park ressies up to Sept 30th???? By the time DVC members make their ressies, might not be any spots left, Now You telling people buy buy buy, they might get disappointed at the 1st time they go to book just say for summer/fall of next year, We DVC members paid alot for this and we spend alot of $$ at Disney, You think they do something to make sure if still a percentage can go to parks, they should figure so much % for us….. If you can reply to me via E-mail on this I would appreciate it
Hotel packages for January – September 2021 went on sale on the 24th.
Any idea why boulder ridge resales are so cheap. I see them between 80-90 a point.
Thanks for all your great info….as always
Boulder Ridge needs a cosmetic makeover. One is expected to begin in a year…but that may or may not occur with all of the changes at WDW.
Boulder Ridge expires Jan 31, 2042. Long before Copper Creek. It’s a small resort, too. Plus it doesn’t connect directly to a theme park by walking. You have to take a bus or a boat. They will need to complete the renovations at SSR first before they can start them at BRV. It was last renovated about 2015 or so, so it’s not terrible, but there are a few problems (especially with the door to the connecting studios in the living room of the one bedroom, not at the entrance to the villa like BCV).
Great post Tom! I agree, there will be further discounts as this pandemic continues. Florida us in rough shape and many dvc owners reside there . We love you bought Saratoga I think was $80 per point in 2004 through resale and the value has gone up not down. Would like to add on but we are from Canada and the exchange rate is poor at the moment. Will see what the prices are like in resale in the months to come.
It’s still popular and I have no problem renting. The nightly hotel fees and added on parking fees and sales taxes at resorts make dvc a good option for me. I like deals from Saratoga Springs resale
What are the resale restrictions at Riveria?
I don’t know how other renters feel but I will never ever ever ever rent again. Ever. Haha. I made my first and last dvc rental reservations for Dec and January and from the way things are going I don’t even feel like the Canadian border will be open. If I had booked direct from Disney I would have already cancelled. With this new outlook on what could happen that really wasn’t on anyone’s radar before I would rather stay in a value than rent points.
Sara, the resale restrictions at RIV are that you cannot use those points at any of the existing DVC resorts if you buy RIV resale, only at RIV and any new resorts (like Reflections was supposed to be). So without Reflections, a resale owner at RIV can only use those points at RIV. If you don’t book in time or can’t waitlist anything at RIV, your points are pretty much lost. If you are selling RIV, you are at a disadvantage and if you are buying RIV resale, you are buying at a disadvantage.