2019 Proposed DVC Annual Dues Increase Impact on DVC Rental Pricing

Now If only we could convince all the owners to rent at the same prices....
 
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Now I feel only we could convince all the owners to rent at the same prices....
Not a bad idea.

If every owner who has used a broker emailed that broker that “With dues rising year after year, 2019 being especially painful, I will be exploring other options to rent my points out until your compensation for points reflect more accurately the increasing costs. Please do reach out when you have a plan in place to address the current disparity.”

I imagine the brokers will have to re-evaluate their offerings.

As brokers go up, so will the market.
 
Not a bad idea.

If every owner who has used a broker emailed that broker that “With dues rising year after year, 2019 being especially painful, I will be exploring other options to rent my points out until your compensation for points reflect more accurately the increasing costs. Please do reach out when you have a plan in place to address the current disparity.”

I imagine the brokers will have to re-evaluate their offerings.

As brokers go up, so will the market.

I like that
 
Not a bad idea.

If every owner who has used a broker emailed that broker that “With dues rising year after year, 2019 being especially painful, I will be exploring other options to rent my points out until your compensation for points reflect more accurately the increasing costs. Please do reach out when you have a plan in place to address the current disparity.”

I imagine the brokers will have to re-evaluate their offerings.

As brokers go up, so will the market.

I'm on it! Anybody else?
 


I'm on it! Anybody else?
Already did this! This past week, I rented 200 banked points but held back the current points (by declining to fill a second reservation) and told them "with annual dues increasing so much, I hope to see an increase in owner compensation." Told two different staffers. They both said, "It depends on the boss blah-blah." Friendly interactions...but it's important they hear the whys.
 
Brokers probably won't raise the amount they pay owners until after they see Disney raising hotel room prices and reducing discounts. Don't think enough owners will stop using the brokers to force a change before that happens.

Brokers can't pay owners more unless their customers are willing to pay the higher prices. A critical mass of their customers will need to see enough of a differential to offset the unfriendly cancellation policy and lack of housekeeping. Don't think they are there yet. YMMV.
 
I haven’t used a broker and don’t plan to at their rates. I’ve had great luck renting them out myself. For example, even at “only” $17pp for BWV points, that’s still more than I’d get from a broker, and they were gone in less than 12 hours. I only rent out what we don’t use every year. Some people charge more because they want to wait and get the most for their points, and that’s their prerogative. Others of us charge what we feel is the going rate and have the money ASAP. Time is money, so I’ll happily take my all my points being rented out super fast over getting an extra $1pp and sitting on them for a while and fielding multiple messages, emails, etc. I don’t rent them out as a business, so I’m happy to recoup my cost and MF’s and make a profit to boot.

I strongly agree that the broker price paid to owners is laughable. Oh well. Some people are willing to accept it, so they’ll continue.
 


Brokers probably won't raise the amount they pay owners until after they see Disney raising hotel room prices and reducing discounts. Don't think enough owners will stop using the brokers to force a change before that happens.

Brokers can't pay owners more unless their customers are willing to pay the higher prices. A critical mass of their customers will need to see enough of a differential to offset the unfriendly cancellation policy and lack of housekeeping. Don't think they are there yet. YMMV.
OTOH, brokers can't offer rentals if they don't have owners willing to settle for their rates. It has been more than a year since they raised their rates. Disney room rates have gone up significantly in the same period.

Unlike some owners who only seek to break even on a rental, I'm not willing to accept a few cents per point in "profit" when the broker is making $3/pt. on the transaction. Factor in taxes I have to pay on the entire rental income and I actually lose money.

The brokers are already dealing with more potential renters than they have owners with points for rentals. They cannot expect owners to continue to accept such poor reimbursement as their own costs rise. At some point, something has to give way.
 
OTOH, brokers can't offer rentals if they don't have owners willing to settle for their rates.

I just rented out some BWV points to some folks that first went to one of the large/largest brokers, that broker didn't have any BWV points. I would hope that if this happens more and more that brokers will start raising their prices and what they pay.
 
I am also waiting for the brokers to up their rates. There is no way I can accept $14/pt. renting any of my points through them.
 
I am also waiting for the brokers to up their rates. There is no way I can accept $14/pt. renting any of my points through them.

I agree 100%. In addition, IF you rent points through a broker, don't you have to "pay taxes" on that transaction? Or at least you must notify the IRS and count this as Income??? That adds another layer of losing out on your $... Not sure if this is true or not...

So.. You rent 160 points out and make $13/point renting them for $2080. Then, they get free parking, and you don't get that money.. 5 nights-$125 a nite you lose out on. Also, the renters don't pay taxes on the rental. So, your $2080 you get from renting, IF you have to go through IRS, and taxes, you will get less than the $13/point... NO way I would rent less than $18-19/point. But, we do not rent out, we use ours all the time.. But those of you that do rent out, I would ask a LOT more!!! Just my .02 worth............
 
I’m not renting via a broker unless their rates go up. They have been due an increase for 2 years at least and it should have been done when parking charges came in. The brokers don’t care as long as they are still getting points as they just work on x mark up. I think now though many owners simply can not afford to give their points away for 13 a night with these new dues charges.
 
Rented the past 3 years on the Rental Board here with no problems, and got my price every time, so there is really no reason to use a broker.
 
We probably have points to rent out and I will not go through a broker bc I’m shocked that the price hasn’t increased since we last rented a few years ago.
 
I rented out some of my points this year in order to use the cash for the 2019 DVC member cruise. I rented the points myself here on the rented boards and had no problem getting my price. I want to say it took me about 2 weeks to rent the amount of points I needed to rent. If I rent again in the near future then I'll have to raise my price due to the increase in dues.
 
This may not be the proper place to ask, we have never rented to anyone so we are clueless. If you go through a broker, and the renter trashes the room, are you responsibility for damages? Really not sure how the whole broker thing works.
 
. . . IF you rent points through a broker, don't you have to "pay taxes" on that transaction? Or at least you must notify the IRS and count this as Income??? That adds another layer of losing out on your $... Not sure if this is true or not...

. . . the renters don't pay taxes on the rental. So . . . IF you have to go through IRS, and taxes, you will get less than the $13/point... NO way I would rent less than $18-19/point.

Yes, it is true. You are required to report it to the IRS. You need to count the money you receive as Rental Income and file a Form 1099-MISC. You can deduct PART of the membership fees, since you can deduct operating expenses and property taxes, but you cannot deduct the cost for 'improvements' or other things. You can deduct the INTEREST from any loan that you have on the property, but you cannot deduct the purchase price to offset the Rental Income. All in all, when you consider adding the cost of taxes, and subtract the actual costs, including purchase costs, EVERYONE who rents is losing money at anything close to the current rates. Even if they do it themselves and don't go through a broker. The best they can hope for is that they will lose money now, and maybe get part of it back when (if) they sell the property down the road.
 
You can see the proposed budget for the resorts that you own on the member website. Look under Condo Association News & then Meeting Notices and Information.

If you want to see a listing of all the resorts' proposed 2019 dues, head over to DVCNews.com
Thanks..checking this out now..
 
As a CPA I feel compelled to clarify some statements. Please do not take any offense as I'm not trying to be argumentative or point out mistakes. However, some people who read these boards could use information they've learned here and I want to ensure their making decisions on accurate info.

Yes, it is true. You are required to report it to the IRS. You need to count the money you receive as Rental Income and file a Form 1099-MISC.

Agreed it's true that rental income must be reported whether a broker is used or not. However, Form 1099-MISC is the form a broker would send to an owner. The owner reports the rental income and expenses on Schedule E.

You can deduct PART of the membership fees, since you can deduct operating expenses and property taxes, but you cannot deduct the cost for 'improvements' or other things.

This is incorrect. Dues are a required expense for the owner and therefore fully deductible from rental income.

You can deduct the INTEREST from any loan that you have on the property, but you cannot deduct the purchase price to offset the Rental Income.

Correct about the interest, not the rest. Contracts have an expiration date, and therefore the owner's right to use diminishes each year. This is similar to depreciation and can most certainly be used to offset rental income.

Disclaimer: This is a very general overview of some topics pertaining to rental income and should not be construed as tax advice. I would highly recommend that any owner who rents and isn't very familiar with tax laws seek help specific to their situation from a licensed tax professional. Preferably one with experience with timeshare rentals.
 
As a CPA I feel compelled to clarify some statements. Please do not take any offense as I'm not trying to be argumentative or point out mistakes. However, some people who read these boards could use information they've learned here and I want to ensure their making decisions on accurate info.



Agreed it's true that rental income must be reported whether a broker is used or not. However, Form 1099-MISC is the form a broker would send to an owner. The owner reports the rental income and expenses on Schedule E.



This is incorrect. Dues are a required expense for the owner and therefore fully deductible from rental income.



Correct about the interest, not the rest. Contracts have an expiration date, and therefore the owner's right to use diminishes each year. This is similar to depreciation and can most certainly be used to offset rental income.

Disclaimer: This is a very general overview of some topics pertaining to rental income and should not be construed as tax advice. I would highly recommend that any owner who rents and isn't very familiar with tax laws seek help specific to their situation from a licensed tax professional. Preferably one with experience with timeshare rentals.


Just to add on - if you depreciate the purchase price you will be subject to more tax liability when/if you sell it
 

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