Riviera Pricing Released

[LAX]

This is the long game. In 2043 they are hoping to have maybe 5-6 resorts following the "new" rules. Direct purchasers can swap out at 7 months, resale buyers will now buy where they want to stay, all right. At 8 months, instead of 11.

Oh... You want to use the whole club? You want access to the low point rooms? That'll be $400/point. At this point, they've completely changed the model. Profit over everything.

You are absolutely correct about it being entirely profit-driven! It's not about making the system "fair" for direct owners at all.

LAX

 

[Eastcoast02]

All this talk of SSR being the red headed step child. The scheduled refurb looks very appealing to me. I won’t stay there until then but maybe it’ll make a significant difference in booking there.

 

[LAX]

I would say we as resale buyers have defined that. As for what resorts are successful is easily defined based on availability at the 7 months. When there is a lot of availability this shows at the very least some owners aren’t buying for that resort’s booking availability but buying for the DVC Reservation Component, which is why I say AKV/OKW/SSR are actually under price. Also my discussion was on the issues at 7 month window and nothing to do with home reservation window, going back to some resorts are under-valued.

With that being said I don’t agree with the changes (but I think something will eventually need to be done with the 7 months if this change is reversed); however, I would say that all contracts prior to 1/19/19 were never guaranteed access to Riviera. Though DVC destroyed its good faith with its consumers which isn't good practice.

I think this issue has been discussed in a different thread. If DRR is not made part of the current "club", then you might have a valid point. However, once DRR is admitted to the "club", then it should abide by all rules as the preceding 14 do. The fact that a direct DRR owner can book at a L14 resort while a post-1/19/19 L14 resale owner can't do the same in reverse makes the system more unfair, IMHO.

LAX

 

[skier_pete]

Meanwhile I’m off to buy sleep around points at SSR. Here’s to putting faith in @skier_pete and the 7 month availability! As for the system.. I’ll do my best to avoid SSR lol..

Yeesh - someone relying on me...don't me very well!

Seriously though - I do believe IF what you are looking for is 1-bedrooms, they will continue to be the easiest to get and may even continue to get easier.

2- The line item budget for 2019 for transportation is the second largest line item on the budget. The top is housekeeping. The third is Administration and Front Desk. All three of these are similar in size. The fourth is maintenance. The fifth is the management fee itself. Is it unusual to have transportation be the second largest line item budget? This is where the Gondola plays out so I was curious how that compared to other resorts in terms of the operating budget.

3- The estimated operating budget for the Riviera for 2019 was $5.842 per point (again, on only 69 vacation homes in the mix). I assume the difference between this and the actual dues they estimated was the property tax assessment. Does this point to the property tax assessment being higher or is that pretty consistent across resorts in terms of percentages to operating / property tax?.

So, there was a lot of debate in the early days of Riviera before it was officially announced as a DVC location. I stated at the time that a DVC resort is a BILLION dollars in income, and that Disney will justify building a direct-to-park transportation system of some sort to get that income. So now we just confirmed that's what they did. $1.33 / point for transportation is pretty outrageous, but they are basically having Riviera owners pay for the gondola system. AKV is $0.54, BWV is $0.45,and Poly with the moldy, oldy monorail is $0.65, CCV/BRV is $0.79, so DRR is unusually high.

That does explain quite a bit why the maintenance fees are so high. $5.842 per point is high. (Again AKV is $5.04 with $0.39 for the Animal Programs, Boardwalk is $4.62, Poly is $4.46.) Now it's true that DRR has 2020 budget housekeeping numbers built in, but I foresee it staying higher than all the others even if we see some higher increases next year.

And if anyone wants to look at all the budget numbers;
https://www.(TYPE RESALES THEN D V C).com/2019-dvc-dues/

 

[Aussie RJ]

I think this issue has been discussed in a different thread. If DRR is not made part of the current "club", then you might have a valid point. However, once DRR is admitted to the "club", then it should abide by all rules as the preceding 14 do. The fact that a direct DRR owner can book at a L14 resort while a post-1/19/19 L14 resale owner can't do the same in reverse makes the system more unfair, IMHO.

LAX

Unfair but we know the rules and we continue to play the game. Our peers are buying DRR and the ROFR thread is as busy as ever. I had hope that the restrictions would be reversed but I don’t ever see that happening now.

 

[LAX]

Unfair but we know the rules and we continue to play the game. Our peers are buying DRR and the ROFR thread is as busy as ever. I had hope that the restrictions would be reversed but I don’t ever see that happening now.

Which rules are we talking about?? Plus, they get changed whenever and however DVD sees fit. Thus, I am not even sure if I know what the rules are, to be honest. I am not under any illusion that DVD will voluntarily pull the latest restriction, but I am waiting to see how all these shake out as some members with a better understanding of the contracts/agreements (perhaps real life lawyers) call into question the legality some of the recent changes. Otherwise, I certainly would have gotten out of this lopsided game.

LAX

 

[crvetter]

I think this issue has been discussed in a different thread. If DRR is not made part of the current "club", then you might have a valid point. However, once DRR is admitted to the "club", then it should abide by all rules as the preceding 14 do. The fact that a direct DRR owner can book at a L14 resort while a post-1/19/19 L14 resale owner can't do the same in reverse makes the system more unfair, IMHO.

LAX

I’ve expressed my viewpoints on that thread. Though my points on this thread was never go to this argument of what was or wasn’t allowed. I was just to explain the problem that exists DVC right or wrong attempted to fix.

I would also add that post-1/19/19 resale buyer knew what they were buying so they have no right to claim the system was unfair because it was the product they bought. Also your argument seems to ignore that resale Riviera can’t book at anywhere else. My guess is your argument of unfair relies on some idea that there will be a hypothetical imbalance of trading of L14 and Riviera. I’m guessing you mean there will be more Riviera trading into L14 than those that can trade into Riviera? I don’t think that is remotely true (and likely never will be because of the vast size of the L14 owner base); and if you meant there are more Riviera owners that trade into L14, than those L14 that want to trade into Riviera this goes back to the point people have expressed about SSR and such (less demand at 7 month for those).

I don’t like their change (and they are aware as I hope everyone else that doesn’t like it tells them) but as owning a post 1/19/19 resale buyer on a contract I knew I was expressly told that Riviera wasn’t a choice to trade and I was okay with it and didn’t think of it as unfair because I had the option of not buying.

 

[DougEMG]

To go back to my previous statement about "fairness" (which admittedly was a poor word choice) I'll offer this example:

Shortly before the restrictions went into place I was able to buy 350 VB points spread over two contracts for the exact same dollar amount as 100 points at DRR. I am currently paying about $1 more per point in maintenance fees. The DRR owner has 25 more years on the contract. The DRR owner can book at the Riviera four months ahead of me. Those are the only meaningful differences in our points (perks excluded for the sake of this conversation for obvious reasons). At the 7 month mark and at any other resort my dollar bought me 3.5 times as many points as their dollar. Does that sound balanced? Does that reflect the operations of a healthy timeshare system? Maybe it does, but to me it seems way off balance. The changes Disney made are attempting to address (not necessarily correct) that imbalance. I'm ok with that I guess.

Keep in mind, this isn't a slam on the Riviera or anyone who chose to buy there. I apologize in advance if it comes across that way. This is simply an example that if you are willing to make a few minor concessions then the differences between owning at different resorts are not commensurate with the wild variations in prices.

You are comparing resale to direct prices, so it kind of exaggerates the example. If Disney were to build VB today, you can be sure they would not be selling it for a third the price of the Riviera.

I am pretty sure that Disney isn't trying to do what is "FAIR". What they are trying to do is change the rules to make their high direct prices and high point costs per room look like a better deal than the alternative. If they wanted to be fair, they could have increased the points during fall frenzy while reducing them the rest of the year, but of course there was no benefit to them to do that, but increasing the lock-off premium definitely benefits them.

With a point system where one can trade between resorts, the only thing you are really buying is the home resort booking window. I believe the resale market is a more accurate reflection of the value of a resort than DVC direct pricing.

 

[crvetter]

Which rules are we talking about??

I would assume they might be referring to the rule that said BVTC could associate any resort to DVC without the say of DVC or DVCMC with any terms or conditions it desires. Also a few other things in your Resort Agreement. Plus the fact the right of club membership is defined in the Disclosure Document.

 

[DougEMG]

And I was told they try to overestimate the MF’s for the first few years so that they can offer a credit rather than a sharp increase when their numbers are off.

Technically I don't think that they are allowed to overestimate the MFs. They are suppose to only be collecting what it actually costs to run the resort. Overestimate/underestimating is nothing more than manipulation in order to benefit yourself (DVC).

 

[DougEMG]

Wow.. that's definitely the main reason why. Poly and VGF are $0.65 and $0.46 respectively and both share the monorail. I'm surprised that Riviera would be over double, especially since the Skyliner also services CBR, Pop, and AoA which have over 5,000 rooms combined (large base to spread costs over).

Those transportation costs don't make sense. The Skyliner is suppose to be cheaper than buses to run.

 

[LAX]

I would assume they might be referring to the rule that said BVTC could associate any resort to DVC without the say of DVC or DVCMC with any terms or conditions it desires. Also a few other things in your Resort Agreement. Plus the fact the right of club membership is defined in the Disclosure Document.

My response was more rhetorical & sarcastic than a real question. Besides, whatever the rules are, if they can be changed unilaterally at any time, do they really mean anything?

LAX

 

[crvetter]

My response was more rhetorical & sarcastic than a real question. Besides, whatever the rules are, if they can be changed unilaterally at any time, do they really mean anything?

LAX

Well I wanted to avoid reading sarcasm as not to offend if it wasn’t there.

This is actually which is my concern that I expressed to DVC on the resale restrictions, not that anything was taken away, but that they can change the rules or simply their interpretation of the rules. Though technically in this instance they just decided to do something within their rules they never exercised, throwing everyone off. Though this change is detrimental to everyone even DVC eventually. But as other suggested once you lose trust of DVC it is the time to sell or resist on adding on, which is what might come back to haunt them if enough do that.

But overall DVC weakest point is being dense on how things come across to members and to do all the stuff at the same time.

 

[crvetter]

Technically I don't think that they are allowed to overestimate the MFs. They are suppose to only be collecting what it actually costs to run the resort. Overestimate/underestimating is nothing more than manipulation in order to benefit yourself (DVC).

I would say perhaps conservative would be a better statement. They are supposed to estimate the actual cost to their best guest, though taxes and new transportation systems are hard to estimate with reasonable accuracy so they are conservative. It is better to be conservative and carry the extra dues as a credit the following year then being liberal with the estimations (example: BLT, Aulani). But any overage always goes back to owners and not to DVC so it in the following year it washes out.

 

[KAT4DISNEY]

I would say perhaps conservative would be a better statement. They are supposed to estimate the actual cost to their best guest, though taxes and new transportation systems are hard to estimate with reasonable accuracy so they are conservative. It is better to be conservative and carry the extra dues as a credit the following year then being liberal with the estimations (example: BLT, Aulani). But any overage always goes back to owners and not to DVC so it in the following year it washes out.

Why do you think they carry the extra dues as a credit? I am of the understanding it is allowed to go to DVCM as an extra above their 12%. They only have true up on Property Tax, not on operational expenses. I don't recall the exact election they can make but essentially it requires them to not pay MF's on their own points and then they cover any shortages or keep an overages.

 

[ELMC]

You are comparing resale to direct prices, so it kind of exaggerates the example.

I agree and that's exactly my point. A system exists where a resale buyer of a lower cost off property resort can gain access to everything a buyer of a brand new higher cost on property resort can gain access to with the exception of a four month booking window. That screams imbalance to me. Not saying it's right or wrong. Not saying it's fair or unfair. It's basically insurance, which just about everyone has in some shape or form. But the premium paid to make sure you can book Riviera four months ahead of everyone else is about $140 per point. Whether or not that's worth it is a personal value judgment.

 

[10CJ]

Have to tell you that a 2-bedroom is cheaper point wise than 3 studios - though of course won't sleep quite as many. 2-bedrooms are fairly easy to get also at 7 months, though not quite as easy as 1-bedrooms. If you haven't seen my charts: https://www.disboards.com/threads/p...-studios-1-bedrooms-june-2018-update.3689931/ but they don't include 2-bedrooms...yet. Soon.

I am definitely interested in the 2 BD info!

 

[Madame]

I agree and that's exactly my point. A system exists where a resale buyer of a lower cost off property resort can gain access to everything a buyer of a brand new higher cost on property resort can gain access to with the exception of a four month booking window. That screams imbalance to me. Not saying it's right or wrong. Not saying it's fair or unfair. It's basically insurance, which just about everyone has in some shape or form. But the premium paid to make sure you can book Riviera four months ahead of everyone else is about $140 per point. Whether or not that's worth it is a personal value judgment.

But this imbalance doesn’t exist to that extreme where it would hit many members hardest. Most book HR during low point / high demand. How is it impacting members of high end resorts if SSR etc buyers have to spend a massive amount of points to stay in Magic season?!?

Those rooms are available at 7 months for a reason - points cost. I say this as someone who can’t book during low season & bought BCV for HR anyway - 13 years til retirement & low points season

I honestly believe that when direct buyers are complaining to DVC, it’s about ALL resalers. They don’t like that they have to compete with resale PVB buyers, for example at THEIR HR. They feel cheated that someone paid less for the same resort. Maybe they should have bought a traditional wk timeshare.

 

[CarolMN]

I think this issue has been discussed in a different thread. If DRR is not made part of the current "club", then you might have a valid point. However, once DRR is admitted to the "club", then it should abide by all rules as the preceding 14 do. The fact that a direct DRR owner can book at a L14 resort while a post-1/19/19 L14 resale owner can't do the same in reverse makes the system more unfair, IMHO.

LAX

Especially since all owners pay the same amount for the Reservation Component, even though some of them will not have the same opportunity to use its features.

 

[crvetter]

Why do you think they carry the extra dues as a credit? I am of the understanding it is allowed to go to DVCM as an extra above their 12%. They only have true up on Property Tax, not on operational expenses. I don't recall the exact election they can make but essentially it requires them to not pay MF's on their own points and then they cover any shortages or keep an overages.

That isn’t correct. In our proposed budgets and at the meetings they have voted that any excess in the funding would be applied to capital reserves, which overall lowers the future year’s requirement to capital reserves. I should also add I’m fairly certain at the end of the resort the capital reserves are returned to current owners based on a specific formula.

But as for the guarantee does have a set of implications. Though in the case with Riviera the parts not declared into the association don’t apply to the guarantee, since it isn’t apart of the association. Disney pays for those cost independent of the Association. The guarantee applies to declared points not sold if I recall correctly.