Several months ago, I set out to write an article about Right Of First Refusal (ROFR) and the trends we are seeing as a result of the current pandemic and closures. Fast-forward to today, and well – you get the point.
As discussed on a recent episode of The DVC Show, Disney Vacation Club has been quietly letting each resale contract pass ROFR without blinking an eye since mid-March. For those unsure what this means, DVC reserves the option to repurchase each contract sold if the seller would ever look to resell in the future. If they like the resale price, they can say the word, and the contract is there’s. For a bit of a more in-depth explanation, check out this previous episode…
Disney’s lack of action with regards to ROFR has created a trickle effect within the Disney Vacation Club industry that, in my opinion, is quickly creating a lucrative buyers market. Here are a few reasons I believe now is the time to buy:
1) Resale Prices Are On The Move
In looking at the data provided by recent contract purchasers over on DISboards, as well as from our friends at The DVC Store, it is hard to ignore the fact that the average price for most resale contracts is trending downward. To dig into this a little further, I ran a comparative analysis looking at recent sales for Disney’s Animal Kingdom Villas for contracts higher than 100 points. This data suggests that we have seen a $1 per month average decrease in per point cost for this specific property. I have to imagine this trend will continue if Disney continues to elect to wave ROFR on all resale contracts.
2) Deals Are Happening
Back in April and May, most resale contracts remained relatively consistent in terms of price. June and July, however, have been a different story! While most contracts are well within the average range of sales, some deals are happening that can’t be ignored. Looking again at Disney’s Animal Kingdom Villas, I have seen several 160+ point contracts sold for under $90 per point!
I don’t write this to suggest you give a lowball offer. In all honesty, that’s a waste of everyone’s time. But many forget that the process of buying a DVC Resale contract is a negotiation. Offering asking price for a contract is almost the same as walking on a car lot and buying a car for list price. Don’t be afraid to ask a little less and see what happens. The worst that happens is that they say no and you try a little higher offer. The best that happens is you find a motivated seller and snag a fantastic deal!
3) Seller’s Are Motivated
We have recently been seeing an increase in contracts coming on the market, giving buyers plenty of options to choose from. While it’s an unknown as to why many are selling, one looks at the current economic landscape and can make a reasonable assumption. DVC, for many, is a luxury item and depending on how the current pandemic is affecting them, it may be something that can no longer be affordable. Although each situation is a little different, some sellers will be eager to unload their contracts as quickly as possible, which can be beneficial to a buyer.
I don’t have a crystal ball, so I can’t begin to predict how long these Disney Vacation Club resale trends will remain. What I can say, however, is that if you are in the market for a contract, now seems to be a better time than ever to buy!
I would love to hear your thoughts in the comments below! Are you shopping for a Disney Vacation Club contract currently? Do you think we may see these resale trends continue?
As always, if you are interested in buying or selling a Disney Vacation Club contract, check out our friends over at The DVC Store!
5 thoughts on “Is Now The Right Time To Buy a DVC Contract?”
I am curious, as one of the “sub-$90” AKV folks, how many sub-$90 contracts are seen at this sites broker/sponsor? I see the one other on ROFR thread, not yet this quarter, and that was an epic deal! But are there a bunch of AKVs in the 80s that are going on that we don’t know about?
Admittedly I HAD TO use a discount broker who’s not as liquid of a marketplace as the strong-and-mighty like DVC Store. And it was my point/ usage need….
You’re the gold standard, Paul Kreiger!! Keep up the great work, and enjoy your trip, I’m hoping you share the experience with your fans, like me!!
jpurce03 on DisBoards
John Purcell on DVC Fan FB
I made a lower offer in some Boardwalk points and we met in the middle and both were happy. Now just waiting to see if DVC let’s it go through. Crossing my fingers!
I have said before, having money is a good thing. Having money during a recession is a great thing. We bought BLT during the Great Recession back in 2009.
The U.S. is officially experiencing an economic recession and obviously there has been a huge hit to the economy. May not be the same as other recessions, but this is different all the way around. Many people are suffering economic hardship, and paying for a DVC (especially a property that is not fully paid) may be a cost they cannot continue. Of course, some may be selling as they need the money. Then there are the people who are speculating as to what the new normal may be.
Travel restrictions, social distancing and masks. What is DVC without Disney Parks. Only a few months ago a huge question was if and when will Disney build another park. Now the question is can they keep the parks they have open. We all know, they cannot keep them open at the current crowd levels.
I think now is a good time to buy, but I think you have to be prepared for a fluctuation in values during this pandemic.
Some of the reason for lower prices is that many of these contracts are stripped out of points, some with Zero points available until late 22 The closings have been pushed out too to accommodate current owner’s upcoming trips ( if possible).
The reason prices are going down is because unemployment, alot of people are out of work. I have a feeling that prices will continue to collapse on DVC contracts especially as we go into the holiday season. Disney just took on over $6b in debt just to get through the next few months. There should not be any ROFR being accepted no matter the price
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