DVC Right of First Refusal (ROFR): September ’17 Report
In the month of September, Disney exercised their right of first refusal (ROFR) on 12 of 166 contracts sold through the DVC Resale Market, representing 7.2% of the contracts sold. This slightly lowers the year-to-date (YTD) buy back rate to 7.8%. In September, the buy back rate saw a modest 22% reduction, going from a rate of 9.3% in August to 7.2% in September. In September, 92.8% of contracts were waived by Disney, marginally raising the YTD waiver rate to 92.2%.
Animal Kingdom accounted for nearly half of the Disney buy backs through ROFR in September. This now places Animal Kingdom just in front of Bay Lake Tower and Old Key West as the second most commonly DVC resort bought back in 2017. Saratoga Springs still retains the top spot with more than double the buy backs of any other resort. The recent buy back rate for Animal Kingdom has increased in August and September with 9 total buy backs during those two months, representing over 40% of the YTD Animal Kingdom buy backs in 2017.
September’s buy back rate of 7.2% stays fairly steady with the YTD buy back rate of 7.8%, which is trending over 70% higher than 2016’s buy back rate of 4.4%.
In September, as DVC resale prices rose month to month, the buy back rate decreased. This inverse correlation has been consistent throughout 2017 with the exception of August, in which the buy back rate rose along with price. This relationship between price per point and buy back rate is shown in the graph below:
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 2017
Please refer to the graph below for the total amount of buy backs at each DVC resort for contracts sold through the DVC Resale Market year-to-date through September of 2017:
Details Data on DVC Buybacks
In September, 5 resorts saw buy backs. Of the 5 resorts bought back in September, 4 of them are among the most commonly bought back: Saratoga Springs, Animal Kingdom, Old Key West and Bay Lake Tower. For details on those contracts that were acquired back, please see the table below:
|Resort||$/Point||Pts. on Contract||Price||Closing Costs Paid by||’17 Dues Paid by||Use Year||Point Availability|
|Animal Kingdom||$95||200||$19,000||Buyer||Seller||Oct||0 pts.’17 + 200 pts.’18 + 200 pts.’19|
|Animal Kingdom||$97||160||$15,520||Buyer||Seller||Oct||0 pts.’17 + 160 pts.’18 + 160 pts.’19|
|Animal Kingdom||$99||220||$21,780||Buyer||Pro-rate||Oct||252 pts.’17 + 220 pts.’18 + 220 pts.’19|
|Animal Kingdom||$89||300||$26,800||Closing||Pro-rate||Mar||146 pts.’17 + 300 pts.’18 + 300 pts.’19|
|Animal Kingdom||$95||160||$15,200||Buyer||Buyer||Dec||164 pts.’17 + 160 pts.’18 + 160 pts.’19|
|Bay Lake Tower||$108||500||$54,000||Buyer||Seller||Feb||0 pts.’17 + 0 pts.’18 + 70 pts.’19|
|Bay Lake Tower||$109||320||$34,880||Buyer||Seller||Feb||0 pts.’17 + 0 pts.’18 + 12 pts.’19|
|Hilton Head||$67||240||$16,080||Buyer||Seller||Feb||0 pts.’17 + 240 pts.’18 + 240 pts.’19|
|Old Key West||$85||230||$19,550||Buyer||Seller||Oct||286 pts.’17 + 230 pts.’18 + 230 pts.’19|
|Old Key West||$79||150||$11,850||Buyer||Seller||Oct||0 pts.’17 + 150 pts.’18 + 150 pts.’19|
|Saratoga Springs||$90||110||$9,900||Buyer||Seller||Feb||0 pts.’17 + 110 pts.’18 + 110 pts.’19|
|Saratoga Springs||$84||250||$21,000||Buyer||Buyer||Dec||250 pts.’17 + 250 pts.’18 + 250 pts.’19|
Buy Back Rates for Disney Vacation Club Resorts
There were 5 different DVC resorts bought back in September for contracts sold by DVC Resale Market. The table below shows the percentage of buy backs for those 5 DVC resorts:
|Resort||Buy Backs||Number Sold||Percentage Bought Back|
|Bay Lake Tower||2||19||10.5%|
|Old Key West||2||10||20.0%|