New Definition of Rental Activity?

[crisi]

Since we don't own, we are renting a room that might otherwise be unoccupied. So I have to think that's a better position for the resort than the room(s) sitting idle.

Not at all from Disney's point of view. If that room sits idle and unoccupied, Disney can rent it out through CRO for cash. If they don't do that, they can upgrade a cash CRO guest whose marketing profile looks like a good candidate to buy into that DVC room. At the very least, it sits empty - which means they don't have the variable costs involved with occupancy - such as cleaning it. But the hope is that if you don't rent a DVC room, you will book a cash room through Disney. And if you don't do that, then you will book something offsite - and Disney will still get the cash they would have gotten from you as a rental (probably a little more since you'll end up paying for parking). They only "lose" money if you decide you aren't doing WDW at all - and even then, they haven't been having attendance issues and fewer people in the parks has some benefits. I don't think there are many "I rent DVC points" guests who are going to make "I can't get a room through rental" the tipping point in going to Disney - and a certain number of the guests that will are so price sensitive that Disney would rather have them not taking up room in line in favor of guests who are less price sensitive.

 

[eticketplease]

I wouldn't know if the resort was sold out or not when booking a reservation. And that isn't a driving factor for our decisions. We use a 1-2 week window of full flexibility where actually purchasing any DVC contract would probably be prohibitive. It gives our position and location somewhat an advantage. We have stayed at several 2BR/3BR villas over the past ~5 years that we wouldn't have stayed at using this method. Incidentally, we took a 5-year hiatus from all the parks, but last month I did purchase my Pixie Dust AP.

We do purchase food/mech. onsite at the resorts we rent at so that does add to their revenue. I don't see how that is hurting their bottom line.

Yes you may not know if a resort is sold out or not. If the DVC site or kiosk doesn’t show promotional information it is considered sold out. Aulani, Cabins at Ft. Wilderness (later this month for new members), Riviera and Villas at Disneyland are the only non sold out locations.

I stated you will add to the bottom line with Food/merch no matter where you stay so not sure about that part of your post.

As I pointed out earlier and as @Robbie Cottam stated you are hurting Disney’s bottom line by not renting directly from Disney. Yes it is good for your wallet but not them.

Renting is one of Disney’s biggest revenue stream. Would they like to sell you DVC? Absolutely but that is a one time cash infusion as opposed to renting from them at their prices. If they crack down on rentals they then take out the rental competition and you are forced to rent from them if those are the accommodations you want.

 

[Robbie Cottam]

Just so it has been said, and someone doesn’t throw it in my face later….

i don’t have an issue with an owner renting unused points, or can’t go and they rent all there points….

i did it, it is allowed…..by disney

my issue comes in with what I believe Disney is trying to target….

recently these was a rental post on this board someone had 9000 points for rent at 7 or 8 different resorts, (and they only had like 25 or 30 post on here)

that person or entity is not a personal use owner with spare points …..

that’s my issue

it has been argued that these types of owners are renting all the high demand rooms on spec, I think that might be true, but have no idea now to prove it , if it is the case that sucks for every one, those type of rentals are what I think Disney is trying to stop because it hurts Disney not DVC members as much

 

[Sandisw]

My other question would be what if you have multiple use years? You have multiple member ID's at that point.

Membership 1 has the majority of points and person made 30 rentals with that one.
Membership 2 has no rentals.

It is technically the same owner so would they be allotted 40 to share per say. Or a strict 20 per membership.

Luckily I don't rent my points very often to worry about these things but you never know down the road.

The current rules were that 20 reservations made on a membership in the name of others within a rolling 12 month period would trigger a review of that membership.

it didn’t matter who the owner was, or if it was a business, trust, etc. If an owner had multiple memberships, they may or may not have looled st all, but my guess is that if they were flagging, they did.

This new lan is much more specific in terms of what can constitute renting outside the rules for personal use….so, I think all owners who are renting a lot are at risk,

However, IMO, this is a move to impact the businesses snd brokers who may be doing it on a larger scale and that is gotten under control, the average owner might skate through.

I do think though it adds an element of risk for renters because if they rent from a large point owner who is clearly renting a lot and often, that owner could all of a sudden get caught by DVC and actions taken…and that could leave the renter at risk of not ending up with a room.

 

[DanCali]

I think all owners who are renting a lot are at risk,

But is it even clear what is "a lot"?

An owner (Owner #1) can rent 15 short reservations for weekend stays in studios that total up to 600 points, and another owner (Owner #2) can rent one weeklong Aulani reservation in a 2BR OV that is also 600 points.

Is Owner #1 "guilty" because he rented 15 reservations even though Owner #2 essentially rented out the same amount of "currency"?

What if Owner #1 owns 4000 points (i.e, rented just 15% of what they own) and Owner 2 owns 600 points and just rents them out every year in the same manner?

It's hard to operate within rules when they are intentionally not clearly defined.

 

[JackosinDIS]

We have established that this same language is also in the Riviera documentation… I suspect also in VDH although don’t have sight of that. Nothing has changed really apart from the expansion of wording to cover connected owners via the use of entities. So yes, they are PROBABLY only looking to target huge owner who have points across multiple memberships… or maybe not given that no action has been taken since they introduced the ‘new’ language in to the RIV docs.

 

[Nabas]

I do think though it adds an element of risk for renters because if they rent from a large point owner who is clearly renting a lot and often, that owner could all of a sudden get caught by DVC and actions taken…and that could leave the renter at risk of not ending up with a room.

If those renters made a deposit on a room rental, they also might have a hard time getting that deposit back.

I would be shocked if Disney doesn't do something within the next few months. The violations appear so brazen that Disney has to have noticed by now.

It seems like a risky time to be renting points from someone you don't know.

 

[crisi]

But is it even clear what is "a lot"?

An owner (Owner #1) can rent 15 short reservations for weekend stays in studios that total up to 600 points, and another owner (Owner #2) can rent one weeklong Aulani reservation in a 2BR OV that is also 600 points.

Is Owner #1 "guilty" because he rented 15 reservations even though Owner #2 essentially rented out the same amount of "currency"?

What if Owner #1 owns 4000 points (i.e, rented just 15% of what they own) and Owner 2 owns 600 points and just rents them out every year in the same manner?

It's hard to operate within rules when they are intentionally not clearly defined.

I don't think its in Disney's best interest to clearly define the rules. So I suspect they will not unless forced to. And frankly, they probably don't need to. But I would personally be cautious if you rent more points than you use over a five year period - even if your total points are relatively small.

Right now, we don't use our points at WDW - we've been using them every other year at HHI. And I've been thinking about just renting out my 150 points a year and hanging onto the contract "just in case." This language makes me more likely to sell the contract if we decide a week in the winter in HH is no longer appealing and still don't make it to WDW.

 

[Sandisw]

But is it even clear what is "a lot"?

An owner (Owner #1) can rent 15 short reservations for weekend stays in studios that total up to 600 points, and another owner (Owner #2) can rent one weeklong Aulani reservation in a 2BR OV that is also 600 points.

Is Owner #1 "guilty" because he rented 15 reservations even though Owner #2 essentially rented out the same amount of "currency"?

What if Owner #1 owns 4000 points (i.e, rented just 15% of what they own) and Owner 2 owns 600 points and just rents them out every year in the same manner?

It's hard to operate within rules when they are intentionally not clearly defined.

Well, it’s been defined since 2007 as 20 or more reservations in a rolling 12 month period to trigger a review. So, someone who rents at or above that level is what I consider renting a lot.

If I was someone who was close to that, I’d certainly be a bit worried moving forward that DVC might be calling.

 

[crisi]

Well, it’s been defined since 2007 as 20 or more reservations in a rolling 12 month period to trigger a review. So, someone who rents at or above that level is what I consider renting a lot.

If I was someone who was close to that, I’d certainly be a bit worried moving forward that DVC might be calling.

I wouldn't bet that remains as the definition, but that is the only indication we have right now what "a lot" is.

 

[DanCali]

Well, it’s been defined since 2007 as 20 or more reservations in a rolling 12 month period to trigger a review. So, someone who rents at or above that level is what I consider renting a lot.

If I was someone who was close to that, I’d certainly be a bit worried moving forward that DVC might be calling.

Sure - but that person can just shift to renting longer reservations in larger rooms and net the same amount of revenue while not getting close to violating that 20-reservation rule.

 

[crisi]

Sure - but that person can just shift to renting longer reservations in larger rooms and net the same amount of revenue while not getting close to violating that 20-reservation rule.

That's why I wouldn't bet on that definition holding. I suspect that there will be a proportion of points used not in the owners name that will trigger a review. There may also be a floor - i.e. we don't bother with small contracts (like mine) that almost always have someone else's name on them.

Though again, its all guesses - and it really depends - if they feel that a lot of renters are grabbing those in demand cabins and its impacting member satisfaction or they think they could get rack rates for them if they went unused, they might target them. If they really don't care about non members booking up Grand Villas, then they won't.

 

[Sandisw]

Sure - but that person can just shift to renting longer reservations in larger rooms and net the same amount of revenue while not getting close to violating that 20-reservation rule.

The newest language has added more qualifiers so I think people who show a pattern of renting for more than personal use…however DVC might want to define it now…should be leery.

But, I personally think it’s not cut and dry with points vs number of reservations. It think it could be a combo of both

However, I think someone who books more frequently for renters is more likely to be seen as a “pattern” than those that book just one or two a year, regardless of number of points.

I know if I wanted to

 

[Robbie Cottam]

But is it even clear what is "a lot"?

An owner (Owner #1) can rent 15 short reservations for weekend stays in studios that total up to 600 points, and another owner (Owner #2) can rent one weeklong Aulani reservation in a 2BR OV that is also 600 points.

Is Owner #1 "guilty" because he rented 15 reservations even though Owner #2 essentially rented out the same amount of "currency"?

What if Owner #1 owns 4000 points (i.e, rented just 15% of what they own) and Owner 2 owns 600 points and just rents them out every year in the same manner?

It's hard to operate within rules when they are intentionally not clearly defined.

You will find a good number of owners state a minimum rental size …..of 150 or so points

 

[Robbie Cottam]

Why wasn’t this question asked at the share holder meeting…
the response would have been something we all could have kicked around more months

 

[Sandisw]

Why wasn’t this question asked at the share holder meeting…
the response would have been something we all could have kicked around more months

Documents were not filed until after!!!

 

[GoingSince1990]

I suspect that Disney has not been enforcing even the 20 reservations per year rule, based on the facts that (1) I have literally never seen a post here saying something like “I accidentally did too many rentals and one of them got canceled”, and (2) very few of the posts on the rent/trade board where someone is renting a lot of points specify a minimum rental size (which they would if the owner was worried about hitting the 20 limit). For even a large points owner it is very easy to never even come close to half of the limit, as there are plenty of large reservations available to book at DVC Rental Store (and I assume David’s, although unlike DVC Rental Store, David’s does not post a list of the current requests on their website). And when renting for personal use is explicitly permitted, it is very hard to challenge someone doing maybe 3 or 4 rentals per year, even if they are quite large, given the difficulty of proving that the renters are not (for example) your old college buddy’s uncle and his family. Of course commercial websites listing hundreds of confirmed reservations available to book at a moment’s notice are another kettle of fish altogether, and it would be very easy indeed for Disney to crack down on them by having employees pose as renters to get the reservations, and then see whose accounts those points were coming from.

 

[hertamaniac]

Not at all from Disney's point of view. If that room sits idle and unoccupied, Disney can rent it out through CRO for cash. If they don't do that, they can upgrade a cash CRO guest whose marketing profile looks like a good candidate to buy into that DVC room. At the very least, it sits empty - which means they don't have the variable costs involved with occupancy - such as cleaning it. But the hope is that if you don't rent a DVC room, you will book a cash room through Disney. And if you don't do that, then you will book something offsite - and Disney will still get the cash they would have gotten from you as a rental (probably a little more since you'll end up paying for parking). They only "lose" money if you decide you aren't doing WDW at all - and even then, they haven't been having attendance issues and fewer people in the parks has some benefits. I don't think there are many "I rent DVC points" guests who are going to make "I can't get a room through rental" the tipping point in going to Disney - and a certain number of the guests that will are so price sensitive that Disney would rather have them not taking up room in line in favor of guests who are less price sensitive.

Interesting, I didn't know Disney's point of view.

I define unoccupied as unoccupied. It's not a rolling, dynamic asset that is used to entice a cash reservation, etc. Certainly, there is a slice of the revenue pie that fixates on that, and I recognize it, but my example was for a 100% empty room with no guests in queue for the extremely upcoming short-term rental (say within a week). My thought is if I was the resort manager, and I have the option to hit a higher occupancy rate, knowing based on histograms, etc. that I will not sell that room, I'd be in favor of filling it even at a reduced rate to gain ancillary revenue (and visibility to the resort).

If I recall correctly, Mousekeeping (full service) is for stays > X number of days at a villa. At least for us, if we requested garbage/towels, it was no issue on a daily basis. I have to imagine the costs for short-term, non-full service Mousekeeping is negligible vs. having the room sit truly unoccupied.

And we are the type of guests that do not go to a WDW DVC resort for a staycation unless we scored a last-minute, somewhat desperate owner looking to rent a booked reservation. We were/are fortunate to have that ability due to where we live, etc. But, I also fully recognize we are likely a very, very small subset of renters in the market. So, I will be keeping an eye on future booked reservations that are 1-2 weeks out and continue to strike the best deals we can. So far, it's opened up some fantastic stays in the 2/3 BR villas we would have never been able to.

 

[crisi]

Interesting, I didn't know Disney's point of view.

I define unoccupied as unoccupied. It's not a rolling, dynamic asset that is used to entice a cash reservation, etc. Certainly, there is a slice of the revenue pie that fixates on that, and I recognize it, but my example was for a 100% empty room with no guests in queue for the extremely upcoming short-term rental (say within a week). My thought is if I was the resort manager, and I have the option to hit a higher occupancy rate, knowing based on histograms, etc. that I will not sell that room, I'd be in favor of filling it even at a reduced rate to gain ancillary revenue (and visibility to the resort).

If I recall correctly, Mousekeeping (full service) is for stays > X number of days at a villa. At least for us, if we requested garbage/towels, it was no issue on a daily basis. I have to imagine the costs for short-term, non-full service Mousekeeping is negligible vs. having the room sit truly unoccupied.

And we are the type of guests that do not go to a WDW DVC resort for a staycation unless we scored a last-minute, somewhat desperate owner looking to rent a booked reservation. We were/are fortunate to have that ability do were we live, etc. But, I also fully recognize we are likely a very, very small subset of renters in the market. So, I will be keeping an eye on future booked reservations that are 1-2 weeks out and continue to strike the best deals we can. So far, it's opened up some fantastic stays in the 2/3 BR villas we would have never been able to.

Even with that short term, they can still entice someone into buying via an upgrade (which frees up a lower priced room that might be able to sell for cash) - and upgrades can be done very last minute. They also need to anticipate needing some last minute cancellations - because they need some rooms sitting empty when last minute maintenance issues pop up - so some waste has to be in their calculations. And frankly, there aren't that many rooms sitting empty at DVC - members looking for a near term reservation often bemoan that lack of availability. That short term rental you are getting - had that reservation been cancelled and those points put back in the system - has a high probability of being snapped up by a member and not sitting empty at all - which both fills the room, adds the marginal revenue, and increases member satisfaction.

 

[hertamaniac]

That short term rental you are getting - had that reservation been cancelled and those points put back in the system - has a high probability of being snapped up by a member and not sitting empty at all - which both fills the room, adds the marginal revenue, and increases member satisfaction.

And it's that delta in time between being consumed by a member or not, is where we hit our sweet spot. It's a small window, but one that has worked greatly for us.