DVC Right of First Refusal (ROFR): February ’18 Report
In the month of February, Disney exercised their right of first refusal (ROFR) on 13 of 233 Disney Vacation Club (DVC) contracts sold through the DVC Resale Market, representing 5.6% of the contracts sold. The waiver rate for February was 94.4%.
February showed a small increase in buyback rate when compared to January’s rate of 3.6%. Overall, February raised the year-to-date buyback rate to 4.5%, which is still lower than the 6.9% for 2017 and very much in line with the 4.4% for 2016.
The chart below shows the relationship between the average selling price per point and the buyback rate from February 2017 through February 2018. Generally, as price has risen, the buyback rate has declined and vice versa. This correlation continued in February as the average resale price dropped slightly from $113/pt. to $112/pt., the buyback rate rose 2 percentage points.
What is Right of First Refusal?
For those new to the concept of Right of First Refusal, it is the option Disney Vacation Club has to purchase any resale contract after a sales price has been agreed upon, and the contract has been executed. Each contract must be forwarded to DVC for review.
DVC may take up to 30 days to review the contract. At their discretion, Disney may step in and purchase the property themselves at the terms agreed upon by the Seller and original Buyer. DVC then becomes the Buyer, and the purchase is complete. Once DVC is the buyer there is not an opportunity to come back with a better offer in hopes of still purchasing the contract.
Disney Vacation Club Resort Contracts Bought Back in 2018
Three resorts continue to lead the way for 2018: Animal Kingdom, Old Key West and Saratoga Springs. Notably, other resorts such as Bay Lake Tower and Boardwalk, that have been historically popular for buybacks that have not had any thus far in 2018.
Please refer to the graph below for the total amount of buybacks at each DVC resort for contracts sold by DVC Resale Market through the month of February in 2018:
Details on DVC Buybacks
In February, DVC Resale Market had buybacks of Animal Kingdom, Old Key West and Saratoga Springs. Old Key West and Saratoga Springs led the way with 5 buybacks each. Additionally, the proportion of Old Key West buybacks was by far the highest. While Animal Kingdom and Saratoga Springs had a similar number of buybacks to Old Key West, the proportions were quite different due to the volume of each resort sold. Roughly around 10% of the Animal Kingdom and Saratoga Springs contracts were bought back, while nearly 24% of the Old Key West contracts were bought back.
Details on the contracts bought back in February are below:
| Resort | $/Point | Pts. on Contract | Price | Closing Costs Paid by | ’18 Dues Paid by | Use Year | Point Availability |
| Animal Kingdom | $105 | 160 | $16,800 | Buyer | Pro-Rate | Mar. | 41 pts.’18 + 160 pts.’19 |
| Animal Kingdom | $101 | 150 | $15,150 | Buyer | Pro-Rate | Sept. | 32 pts.’18 + 150 pts.’19 |
| Animal Kingdom | $100 | 250 | $25,000 | Buyer | Pro-Rate | Sept. | 204 pts.’17 + 46 pts.’18 + 250 pts.’19 |
| Old Key West | $80 | 310 | $24,800 | Buyer | Pro-Rate | Jun. | 155 pts.’18 + 310 pts.’19 |
| Old Key West | $85 | 200 | $17,000 | Seller | Buyer | Oct. | 400 pts.’17 + 200 pts. ’18 + 200 pts.’19 |
| Old Key West | $84 | 150 | $12,600 | Buyer | Seller | Aug. | 0 pts.’18 + 150 pts.’19 |
| Old Key West | $87 | 150 | $13,050 | Buyer | Buyer | Mar. | 150 pts.’18 + 150 pts.’19 |
| Old Key West | $86 | 270 | $23,220 | Buyer | Buyer | Aug. | 270 pts.’18 + 270 pts. ’19 |
| Saratoga Springs | $86 | 210 | $18,060 | Seller | Pro-Rate | Sept. | 108 pts.’17 + 140 pts.’18 + 210 pts.’19 |
| Saratoga Springs | $88 | 255 | $22,440 | Buyer | Buyer | Apr. | 255 pts.’18 + 255 pts.’19 |
| Saratoga Springs | $88 | 200 | $17,600 | Buyer | Seller | Sept. | 4 pts. ’18 + 200 pts.’19 |
| Saratoga Springs | $95 | 180 | $17,100 | Buyer | Seller | Apr. | 180 pts.’18 + 180 pts.’19 |
| Saratoga Springs | $90 | 250 | $22,500 | Buyer | Seller | Apr. | 0 pts. ’18 + 250 pts.’19 |
Buy Back Rates for Disney Vacation Club Resorts
The table below shows the percentage of buybacks for all 3 different resorts purchased back in February:
| Resort | Buy Backs | Number Sold | Percentage Bought Back |
| Animal Kingdom | 4 | 41 | 9.8% |
| Old Key West | 5 | 21 | 23.8% |
| Saratoga Springs | 5 | 43 | 11.6% |
Comments
We lost an AK contract to Disney in Feb and it is not listed. Maybe there’s a delay in the publishing of it?
Karen – it’s always possible we missed something, but just to be sure it was a contract purchased from DVC Resale Market? If so, can you provide me the details such as price, size and point availability, and I can double check.
Nick
We are waiting for a loaded SSR (low price as well)to pass rofr. If it gets taken, do you recommend staying away from such deals? I ask, because I ran across another loaded contract with low price at BWV. Would hate to invest the time just for that one to get taken as well. Appreciate any insight.
Melissa, thank you for reaching out. This is really a personal choice. If you are getting something loaded and low priced, especially on resorts Disney has a strong history of buying back like Saratoga Springs and Boardwalk, you are always going to run a high risk of buy back. That being said, to get an exceptional deal that is always the risk you run. So, it really comes down to how much your time is worth, and how quickly do you need the points. You are not losing money when a contract is bought back, but you are losing the time you spent searching and executing the purchase as well as the weeks in your timeline based on how long it took to get an answer from Disney.
So….you are saying there is a chance. Lol…appreciate your reply….Have a great weekend!
Haha, yes, there is always a chance 😉
Every now and then I see one get through that you would thinks is almost a certainty for ROFR.
The prices of the Grand Floridian DVC secondary market have definately increased over the past few months. When I bought in about 2 years ago the prices were hovering around 130 to 150 a point. Now the listings are regularly touching 160 170 180 a point. If you want to buy GF points at the older prices you have to look at 300+ point contracts. These have been my observations. The GF compared to Animal Kingdom and SSR are at completely different price points. No need for Disney to buy back at this price point.
There are a lot of references to the three resorts with buy backs- it looks like there were five to me. I don’t see any data on the WL of VGC buybacks.
Tawnie, in February, we only had buy backs on SSR, AKV and OKW. The table you are referencing also includes a BR at WL and VGC because it is a year-to-date chart, and in January we did see those 2 buy backs. For details on those 2 contracts, please see: https://www.dvcresalemarket.com/blog/dvc-right-of-first-refusal-rofr-january-18-report/
I’m looking to buy a 75-100 point add on to my existing SVC. Do you think Saratoga or Polynesian is a better buy right now? Or just wait to see if prices adjust since the recent hikes?
John, if you are looking at long term economics and considering, price, years left and dues, usually Saratoga Springs almost always comes out on top (please see: https://www.dvcresalemarket.com/blog/proposed-2018-dvc-annual-dues-and-its-economic-impact-to-owning-dvc/). However, if you have a preference between the two resorts in regards to where you would prefer to have Home Resort Priority, I would strongly consider that as well. Granted, SSR is typically the easiest resort to book unless you are trying to book the tree-houses, which will book up much faster than other SSR rooms.
Surprising to have no buybacks at Grand Floridian. I tried to buy direct there multiple times for a small point contract (for the benefits) but they wouldn’t waitlist. Seems like the price raise to $220 is more artificial, and boosting the resale prices. Unless they start buying contracts back, could we see the market go back to the previously prices we saw only a few months back? Time will tell, I’m sure.
Evan, if we don’t have buy backs of Grand Floridian and the resale inventory for Grand Floridian becomes high we could see a price drop, but really the biggest factor of price change is supply and demand. Certainly, buy backs do contribute to supply and demand as well. And you are right, time will tell.
Wow almost 24% buy back for OKW. We’re waiting on one that has no points until ’19 so hopefully Disney doesn’t want that or thinks the price is too low. I’m thinking there’s a method to their madness or is it random depending on the luck of the draw of when they look at a contract on any given day?
Jay, while there is some randomness, much of it does follow correlations, such as price and particular resorts. One big advantage they have with Old Key West for example, is that a non-extended Old Key West contract will logically resell for less than an extended one, however, when Disney buys an Old Key West back, the extension is automatically added when they resell it. So for non-extended Old Key West contracts, this circumstance does increase their margin.
Hi Nick! I’m just starting to look into purchasing DVC points on the resale market. Can you explain what extended vs non-extended contracts at OKW property are? Are they extending the contract date on some contracts? Thx! ~Julie~
Julie, thank you for reaching out. Old Key West was originally sold with an expiration date of 2042. However, in 2007, DVC offered an extension opportunity for Old Key West where for $15/pt. a Member could extend their Old Key West contract to 2057. Later, that extension became $25/pt. and still is. Note, DVC has not since offered this extension to any other DVC resort. If DVC sells an Old Key West contract directly today, it will include the extension.
Thanks for the information, Nick! Do you think Disney will ever offer the option to extend contracts for members who own at BCV or BWV? Also, was this offer extended to all OKW owners when it became available, regardless of whether they had purchased their contracts direct or resale?
Thanks again!
Julie
Julie, I think it is possible, but I don’t think it would be offered until we get much closer to the end date. The acceptance rate for OKW was very low, and I think the primary reason is because you are asking people to spend money on something they will not see the benefit of for nearly 35 years as the OKW extension was originally offered in 2007.
If you buy OKW resale and then extend it for $25 pp with Disney, would your resale contract be considered direct and be eligible to get member perks?
Mike, your OKW contract would still be considered resale in that scenario.
Hi Nick, we haven’t done business as yet, but your comment about OKW extended piqued my interest. I have 7 contracts across BCV, BWV and AKV and have been looking to add OKW extended. I am aware of the 15 yr extension, but reading your post about the 25 yrs – would that be available to someone buying resale, or is that only extended to a direct purchaser. I had never heard about the 25 year option until now. I was also not aware that direct OKW contracts were extended. So, my question is, as a resale owner of an OKW contract, could we opt for an extension? Thanks for your great info.
Linda, thank you for reaching out. The only extension is a 15 year extension to Old Key West for $25/pt. This is an option for a resale purchase. Once the resale contract is closed with Disney, you can then extend it for $25/pt.
Happy day. Just got word Disney passed on ROFR for our OKW contract. Was quicker than I was expecting too.
Jay – congrats and welcome home soon!
In the table above on February sales, those coming through DVC Resales or DVC as a whole? We received word late last week that DVC exercised their ROFR on the Animal Kingdom points (160/September) we were trying to purchase. It only took two weeks for them to respond. Our offer was an attractive price (for us) but probably too attractive. It was through another reseller. I must say, It was disappointing and especially now that prices seem to be edging up
Randy, the sales and buy backs from this article are from DVC Resale Market. Sorry to read you had a contract bought back; hopefully, the 2nd time around you will find more success with passing ROFR.