DVC Price Increase Pushing Some Resorts Over $200 Per Point!

11 Comments
Disney's Grand Californian

Disney Vacation Club will be adjusting many DVC resort prices per point effective January 17, 2018.  With the exception of Vero Beach, all resorts considered “sold out” and “live” will be experiencing price increases.

For the first time ever, a few DVC Resorts will be priced in the 200’s per point:  Polynesian, Grand Floridian and Grand Californian.

Impact of Price Increase to DVC Resale?

While DVC resale prices will not increase instantly, certainly history has shown that overtime DVC resale prices typically rise in the months following a direct price increase, especially on resorts that experience large price increases.  It is important to note that with this round of price changes, 4 resorts will have price increases of $20 per point or higher.  Please click here to see current DVC resale listings!

For a full list of current direct prices and the new prices, effective January 17, 2018, please see below:

Resort Current Price Per Point Price on 1.17.18 Per Point Variance Per Point
Animal Kingdom $165 $171 +6
Aulani $176 $182 +6
Bay Lake Tower $185 $191 +6
Beach Club $165 $185 +20
Boardwalk $165 $171 +6
Boulder Ridge $165 $171 +6
Copper Creek $176 $182 +6
Grand Californian $185 $235 +50
Grand Floridian $185 $220 +35
Hilton Head $115 $121 +6
Old Key West $145 $151 +6
Polynesian $176 $220 +44
Saratoga Springs $145 $151 +6
Vero Beach $115 $100 -15

 

Possible Strategy Behind the DVC Price Change

Besides the obvious reason of when you raise the price, you raise your margin (at risk of losing volume), there could be several reasons for these price increases:

Disney's Polynesian Resort

  1. Announcing an upcoming price increase for Polynesian as it reaches a near sell-out level provides excellent urgency to finish the sell-out phase quickly.
  2. The price increases of the “live” inventory, Copper Creek and Aulani are mild compared to many of the other price increases and will soon look inexpensive by comparison to those “sold out” properties such as Polynesian, Grand Floridian and Grand Californian, which will be north of $200 per point. The average increase per point for the “live” inventory (excluding Polynesian as it is nearing sell-out) will be $6/pt. compared to that for all other properties at over $14/pt.  Having the “live” product, what you have the most of to sell, look the most attractive is a sound strategy.
  3. The large increases in price for Polynesian, Grand Floridian and Grand Californian provide for much stronger margins if and when Disney exercises their right of first refusal (ROFR) on these properties.  Year-to-date, DVC Resale Market has only observed 1 contract bought back through ROFR for all 3 of these resorts combined.  Year-to-date, DVC Resale Market has observed 161 contracts bought back from other resorts.  This low buy back rate may initially come as a shock, but when you consider these premium location properties typically resale in the 130’s to 150’s per point, the resale margin for Disney gets much tighter.  For example, Saratoga Springs contracts have routinely been bought back this year through ROFR in the 80’s per point and resold direct at $145 per point.  Making $65 per point off of an $80 per point Saratoga Springs contract is much stronger financially than making $40 per point off of a $140 per point Grand Floridian contract.

Disney's Grand Floridian

Comments

  • Cory
    January 12, 2018

    Nick. Why do you think the reason is that BLT is the only Monorail Resort that is under 200 price per point and considerably lower than The Poly and Grand Floridian?

    • Nick Cotton
      January 13, 2018

      Cory, great question. Bay Lake Tower remains popular, but the other resorts I believe had different circumstances driving the price higher. I think the justification for Grand Floridian and Grand Californian can be partially attributed to very strong demand (i.e., very long wait list when they had them for those resorts.) As mentioned in the blog I think having a big price increase for Polynesian would drive a fast final sell-out of that resort and it did as Polynesian officially sold out earlier this week.

  • Alex Winter
    January 3, 2018

    What does this mean for current DVC owners, specifically for Polynesian as your home. Will it become harder to book nights at these resorts?

    • Nick Cotton
      January 3, 2018

      Alex, it should mean good news in terms of your dollar value in the event you ever want or need to resale it. It shouldn’t have any impact on your ability to book. Polynesian, like any DVC resort eventually gets a “sold-out” status, but even before that Disney is still using the Polynesian inventory when they own it (i.e., renting to cash customers, etc.).

  • Phil
    December 27, 2017

    I have 180 points at Grand Floridian thinking of selling to buy more Animal Kingdom Lodge.

    I do not have points until Dec 2018, what that be a big roadblock to a buyer?

    • Nick Cotton
      December 27, 2017

      Phil, that will not be a roadblock, many contracts are sold with similar point availability. Additionally, it is a great time to sell Grand Floridian with the upcoming price increase for direct purchases.

  • Darrell F. J. White
    December 19, 2017

    Question: according to the article it says the Grand Floridian prices will be increasing 35 dollars a point. Presumably it won’t rise that amount in the secondary market. Historically, when we see a percentage increase in the direct market how does that usually translate percentage wise in the secondary. Thank you.

    • Nick Cotton
      December 19, 2017

      Darrell, great question. Generally, we see a gradual rise in price in the 6-8 months following a direct price increase. Granted, other factors can always contribute to resale prices as well such as inventory levels, etc.

      • Darrell F. J. White
        December 19, 2017

        Thanks Nick. Generally would you predict the resale market for the VGF in this case would increase approx 50% of direct price increase or 25% or where would you think? What has happened historically?

        • Nick Cotton
          December 19, 2017

          Darrell, if market conditions remain roughly the same (i.e., stable inventory numbers, healthy economy), I could see something along the lines of 50% of the direct increase or roughly $17/pt. over the course of 6-8 months happening to resale. The other factor will be if Disney begins to get more aggressive in exercising ROFR on GF contracts now that the margin is higher. If so, they would naturally drive up the resale price as well.

  • Darrell F. J. White
    December 19, 2017

    As a grand floridian dvc owner im glad this is happening as it makes our location even more exclusive 🙂

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