RESALE POLICY CHANGE!

[supersnoop]

access to things such as the Top of The World Lounge,

I don't think TOTWL access is a "Membership Extra." Heck, only "certain" discounts are Membership Extras. So, it's really difficult to know what will actually be excluded until we see some experience.

 

[Dean]

I don't think TOTWL access is a "Membership Extra." Heck, only "certain" discounts are Membership Extras. So, it's really difficult to know what will actually be excluded until we see some experience.

Plus it is likely to be a moving target. I agree, we'll have to see how it flushes out.

 

[supersnoop]

Plus it is likely to be a moving target. I agree, we'll have to see how it flushes out.

Indeed. It seems like the way they set up "Membership Extras" was a long term plan. When they first introduced the "Membership Extras" program, it seems like it was only special events that were offered to members, but were overpriced.

 

[ScubaCat]

The official document says "purchased an ownership interested directly from DVD." Any purchase should qualify.

Yes, fair point there. I guess the real question is will they sell a 25 point contract to a recent resale buyers. We'll find out soon enough.

Indeed. It seems like the way they set up "Membership Extras" was a long term plan.

That's what I thought as well. It basically is Disney rebranding of "incidental benefits" so they can all be easily removed from post 4/4/16 resale buyers.

 

[Dean]

Yes, fair point there. I guess the real question is will they sell a 25 point contract to a recent resale buyers. We'll find out soon enough.

I would presume this is the case and appears to be currently but could easily change in the future by instituting a minimum number of points purchased direct to qualify, simply increasing the minimum, by instituting a minimum price to qualify or by selling repurchased points as "resale". Of these I'd expect an increase in the minimum or no change as the most likely options.

 

[ziravan]

I would presume this is the case and appears to be currently but could easily change in the future by instituting a minimum number of points purchased direct to qualify, simply increasing the minimum, by instituting a minimum price to qualify or by selling repurchased points as "resale". Of these I'd expect an increase in the minimum or no change as the most likely options.

I don't think it's reasonable to increase the minimum past what a new purchaser would need to qualify and that's currently 50.

I don't see them raising it more than that because small point sales are the backbone of $170 points. The point is to spur new sales not discourage them.

So. I think 25 will work for now or they should have said something by now. I wouldn't be surprised if they do move it to 50 to qualify.

I do think 50 is worst case.

For example, if they decided it takes 100 points to qualify resale points but 50 can get you a new contract with benefits, then the advice on the forums would be to buy direct first at 50 and then add resale. Resale buyers are much more likely to see what's being said here before buying.

In any case, it's an open debate NOW whether it's worth a 25 point add on for what's missing. I think it would be. 50 points strains that incredibly. Anything over 50 points will make it moot, not worth it without a doubt. Again, the point of this mess is to sell points. I think DVC will be quite happy with hundreds of 25 or 50 point contracts as a result of this change (combined of course with the ability to further discourage resale as a talking point at the point of sale).

 

[Dean]

I don't think it's reasonable to increase the minimum past what a new purchaser would need to qualify and that's currently 50.

I don't see them raising it more than that because small point sales are the backbone of $170 points. The point is to spur new sales not discourage them.

So. I think 25 will work for now or they should have said something by now. I wouldn't be surprised if they do move it to 50 to qualify.

I do think 50 is worst case.

For example, if they decided it takes 100 points to qualify resale points but 50 can get you a new contract with benefits, then the advice on the forums would be to buy direct first at 50 and then add resale. Resale buyers are much more likely to see what's being said here before buying.

In any case, it's an open debate NOW whether it's worth a 25 point add on for what's missing. I think it would be. 50 points strains that incredibly. Anything over 50 points will make it moot, not worth it without a doubt. Again, the point of this mess is to sell points. I think DVC will be quite happy with hundreds of 25 or 50 point contracts as a result of this change (combined of course with the ability to further discourage resale as a talking point at the point of sale).

I agree that the ceiling would be the new purchase amount, if they did so I too would expect it'd be 50 points though I could see them increasing the new purchase minimum as well but if they did I'd expect it to stop at 50 points to be qualified for current owners. I would also see them taking deeds back at some point and replacing them with qualified points, for a fee of course. I'm sure they have the numbers but we don't. I'd say that there are several points that would push them to raise the minimum. One is that often those 25 pt contracts end up as stand alone and thus are more costly for the system than a larger contract and they make a lower profit on 25 compared to 50 points. Another is that many that would buy 25 would also buy 50 if that were the minimum so the question from that standpoint would be how many sales do they lose vs how many they gain. I'd guess they have to sell 90% of the points at a minimum of 50 compared to a minimum of 25 and that they'd easily hit that mark. We'll see how serious they get about limiting the benefits of resale buyers, they haven't gotten serious yet IMO.

 

[skier_pete]

I also agree the ceiling is 50 points. But if you are looking at buying SSR resale at $80 a point, and have to buy some $170 points. That's the difference between spending $4,250 for 25 pts, or $8,500 for 50 pts is a pretty severe difference.

 

[ziravan]

My guess is that they'll allow 25 point upgrades for now as a bridge to those that were considering buying and got caught flat footed on 4/4. I know they owe nothing to the resale market but they've shown (fixing the grandfather debacle) that they at least pay some attention to fallout on social media. Besides, what's the harm?

Soon enough the new restrictions will be the norm for everybody considering buying.

Sooner than later, I expect the policy will change to 25 pt add ons allowed, but it takes 50 to qualify as a member.

The upshot is that for those considering upgrading to member for 25 points, it's probably a small window of opportunity.

 

[Dean]

I also agree the ceiling is 50 points. But if you are looking at buying SSR resale at $80 a point, and have to buy some $170 points. That's the difference between spending $4,250 for 25 pts, or $8,500 for 50 pts is a pretty severe difference.

But still cheaper than buying all retail. SSR is currently $140 a point retail IIRC. If one can plan accordingly the difference isn't dramatic unless you need a small amount of points to start with and then there is serious consideration to buying retail for all as DVD intends. So for 200 points total, it'd be $16K or so resale or $17500 for 175 resale plus 25 retail or $19000 for 150/50 vs $28000 for all retail. Other than the qualified/non qualified issue there are other minor advantages to resale/retail. A loaded contract resale adds additional value, buying points late in the UY and/or late in the calendar year can add some additional benefits. I personally don't believe the speed of the transaction adds enough value to make it worthwhile and for many new to DVC it likely hurts them/costs them money because it "forces them" to make a quicker decision. Put another way, the benefit of getting the points early for that "next trip" offers a cost and not a savings in the long run with extremely few exceptions.

My guess is that they'll allow 25 point upgrades for now as a bridge to those that were considering buying and got caught flat footed on 4/4. I know they owe nothing to the resale market but they've shown (fixing the grandfather debacle) that they at least pay some attention to fallout on social media. Besides, what's the harm?

Soon enough the new restrictions will be the norm for everybody considering buying.

Sooner than later, I expect the policy will change to 25 pt add ons allowed, but it takes 50 to qualify as a member.

The upshot is that for those considering upgrading to member for 25 points, it's probably a small window of opportunity.

I suspect they will honor the option at this point going forward for a while but I don't think it'll be to accommodate new resale buyers but rather it takes time to turn a large ship. Whether it'll be a small window or continue to be an option going forward, we'll have to see.

 

[skier_pete]

I suspect they will honor the option at this point going forward for a while but I don't think it'll be to accommodate new resale buyers but rather it takes time to turn a large ship. Whether it'll be a small window or continue to be an option going forward, we'll have to see.

Sooner than later, I expect the policy will change to 25 pt add ons allowed, but it takes 50 to qualify as a member.

Actually - I disagree. I think there's a good chance they keep it at 25 points. I know they sell quite a few of these contracts, and having these contracts makes it a lot more likely that people will buy them direct.

Speaking for myself, if I was looking at purchasing DVC today, I would still never consider full price. I would MAYBE consider the 25 point contract option, but 50 would already be too rich - I would just deal with the lack of discounts. Eliminating the 25 point option would eliminate my sale.

But Disney knows the folks that are going to JUST buy a 25 point contract for the perks are going to be the minority. The point of all this is the sales pitch. To say "You can't get these perks without buying through Disney." Continuing to allow the 25 point contract doesn't hurt them enough to turn away the benefit of it.

 

[supersnoop]

Sooner than later, I expect the policy will change to 25 pt add ons allowed, but it takes 50 to qualify as a member.

I can't see that happening. In order to do that, they'd have to have another clause on that disclosure form and another grandfathered-contract date. The changes can't be arbitrary.

 

[sndral]

I'm confused - I read elsewhere that an owner just closed on a resale purchase post 4/4/16, and rather than having the new contract show up under their existing member number they received a new member number for the post 4/4 resale points.
Have there been any other reports of this or is this just a one off or glitch?
Better yet, has anyone closed post 4/4 w/ the same use year and had that new contract added to their existing member number?
Am I correct in assuming that if there is a different membership number then there may also be limits on transferring & borrowing just as there are now when you have a different use year and get different member numbers?
Note I own one contract and am waiting for the right use year/no. of points/price to hit the market to buy my second contract and if I'll get a different member number even if I match use year and names on the deed thus having to deal w/ transfers & the like, then I won't care so much about matching use year.

 

[Disney Dad ADL]

Clarifying, my understanding was that TOTWL is space that is part of BLT but it was made a commercial unit (currently owned Disney) that can be operated by business entities, which would mean that whatever entity is using it pays for its maintenance, repairs, and operations and the money for that does not come out of dues. That distinguishes it from Community Halls which are actually part of the common areas for which dues cover their maintenance and operations. Under timeshare law, one of the requirements for a perk to qualify as an incidental benefit which Disney can exclude resale owners from using is that members' annual dues are not used to provide or maintain it. Thus, TOTWL could potentially be a perk that Disney could exclude resale purchasers from using. However, excluding resale purchasers from using it may not be a wise business decision because TOTWL's business model depends solely on members (and not others) using it and buying items such as drinks at TOTWL.

My understanding is that it was a commercial unit at first but later it was changed and the BLT owners got stuck with the expenses. Disney leased itself back the lounge and bar and keeps the proceeds from the bar sales.

Bill

TOTWL was definitely a "Commercial Unit" when first declared.

Here are the plans for TOTWL, which is labelled as "CU-2" (Commercial Unit 2) (the actual declaration is at the bottom of my post)

http://or.occompt.com/recorder/eagl...42.pdf?id=DOC827S33240.A1&parent=DOC827S33240


I don't know what happened after that (if it was somehow leased to Disney, or maybe DVD in fact owns the lounge), but I don't know how to find that information.

The definition of a "Commercial Unit" is laid out in this BLT Condominium Declaration:

http://or.occompt.com/recorder/eagl...532599&id=DOC293S21987.A0&parent=DOC293S21987

Relevant quote below:

" 1.11 Commercial Unit means a Unit together with an undivided share in the Common Elements,as set forth in Exhibit"D" attached to this Declaration, intended and designed for the conduct of a business enterprise to serve its Owner,the Owner's lessees,guests,invitees, licensees and such other persons who may lawfully be entitled to come on the Condominium Property and refers to all of the Commercial Units set forth in Exhibit"A".Unless the context requires otherwise and except with respect to the Vacation Ownership Plan and the Club,all references to "Unit" include the Commercial Units. "

I read an article a few months ago which implied that the TOTWL was a "Common Element", but after looking at the actual recorded documents, it appears to be a "Commercial Unit" as described above. I'm not yet sure what the implications are of this, though, in terms of membership perks.

Edit: looking at the floor plans, the bathrooms are Common Elements though, so we BLT owners are definitely paying for the bathrooms.

Edit #2: This is the official Declaration for BLT Phase 93, which includes TOTWL (CU-2)

http://or.occompt.com/recorder/eagl...43.pdf?id=DOC827S33241.A2&parent=DOC827S33241

 

[skier_pete]

I'm confused - I read elsewhere that an owner just closed on a resale purchase post 4/4/16, and rather than having the new contract show up under their existing member number they received a new member number for the post 4/4 resale points.
Have there been any other reports of this or is this just a one off or glitch?
Better yet, has anyone closed post 4/4 w/ the same use year and had that new contract added to their existing member number?
Am I correct in assuming that if there is a different membership number then there may also be limits on transferring & borrowing just as there are now when you have a different use year and get different member numbers?
Note I own one contract and am waiting for the right use year/no. of points/price to hit the market to buy my second contract and if I'll get a different member number even if I match use year and names on the deed thus having to deal w/ transfers & the like, then I won't care so much about matching use year.

I am not an expert - but I thought if you had a different UY on your contracts you got two different member numbers? Is that incorrect? You didn't specify that both contracts mentioned had the same UY.

 

[disneynutz]

Here are some posts from 2011 about TOTWL and Disney switching from a commercial unit to part of the leasehold condominium.

http://www.disboards.com/threads/towl-declared-for-blt-owners.2782768/

Bill

 

[Disney Dad ADL]

Here are some posts from 2011 about TOTWL and Disney switching from a commercial unit to part of the leasehold condominium.

http://www.disboards.com/threads/towl-declared-for-blt-owners.2782768/

Bill

Yes, that is the same article that I read that implied that TOTWL is a Common Element, but as far as I can tell that is not correct, as @drusba also comments in that thread. The document declaring TOTWL as a Commercial Unit was signed in June 2011. A picture of that same document is shown in that DVCNews article but is clearly labeled "CU-2". I searched the records after that until the end of 2012, but there were no further documents changing it's status as a Commercial Unit to something else. Based on the Main Condominium Declaration, it is legal for Disney to convert TOTWL (and any other Commercial Unit) into a Common Element without requiring any approval, but I have not seen any evidence that this has actually happened. As far as I can tell, TOTWL is a Commercial Unit and likely owned by Disney, so they can do whatever they want with it in terms of access. However, as a Commercial Unit, our dues should not pay for the maintenance, and in fact, the Commercial Units are also responsible for paying their share of maintenance of Common Elements (again stated in the BLT Condominium Declaration).

That being said, I could be completely wrong and have just missed the document converting TOTWL to a Common Element (or don't have access to it).

 

[drusba]

It appears someone in the prior post confused that the unit's being declared to be a commercial unit in the BLT condominium meant the unit was part of the common elements. That is not correct. Any commercial unit that is part of the condominium is, by definition of a "commercial unit," not a common element.

It thus does not resolve the issue of whether Disney can treat TOTWL as a incidental benefit that it can exclude resale purchasers from using. Resale purchasers can be excluded from the use of an incidental benefit, while other members can use it, only if the annual dues to which the resale purchasers contribute are not used to maintain, repair, or operate the applicable incidental benefit. The documents declare that the owner of a commercial unit (which was DVD unless it sold or transfered it to another Disney entity) covers all of the operations, repair, and maintenance costs of a commercial unit (but, of course, can lease it to another who pays for such things). However, there could be things in the commercial unit, such as bathrooms, declared to be common elements, or more particularly "limited common elements" usable when using a commercial unit, and the association (and thus owners dues) is responsible for the maintenance of those common elements. Thus, you get into a more complex analysis to determine whether, and the extent to which, resale purchasers can be excluded.

 

[Dean]

Actually - I disagree. I think there's a good chance they keep it at 25 points. I know they sell quite a few of these contracts, and having these contracts makes it a lot more likely that people will buy them direct.

Speaking for myself, if I was looking at purchasing DVC today, I would still never consider full price. I would MAYBE consider the 25 point contract option, but 50 would already be too rich - I would just deal with the lack of discounts. Eliminating the 25 point option would eliminate my sale.

But Disney knows the folks that are going to JUST buy a 25 point contract for the perks are going to be the minority. The point of all this is the sales pitch. To say "You can't get these perks without buying through Disney." Continuing to allow the 25 point contract doesn't hurt them enough to turn away the benefit of it.

I could see it going either way. While it might stop some from buying retail, it would cause some to buy more points retail. Overall I suspect it'd be a wash and with less 25 point contracts, I see that as a win for DVCMC and the membership in general other than the ones wanting the smaller contracts.

I can't see that happening. In order to do that, they'd have to have another clause on that disclosure form and another grandfathered-contract date. The changes can't be arbitrary.

I don't see any legal requirement keeping them from making changes retroactively. Certainly this change has set them up for future changes in the perks. There's certainly no requirement for them to sell the smaller contract. It'd be pretty easy to make any changes to say under 50 points wouldn't be considered qualified. I doubt they'll create that situation though, I'd suspect they'll either leave it at the 25 or just raise the minimum likely to 50.

I'm confused - I read elsewhere that an owner just closed on a resale purchase post 4/4/16, and rather than having the new contract show up under their existing member number they received a new member number for the post 4/4 resale points.
Have there been any other reports of this or is this just a one off or glitch?
Better yet, has anyone closed post 4/4 w/ the same use year and had that new contract added to their existing member number?
Am I correct in assuming that if there is a different membership number then there may also be limits on transferring & borrowing just as there are now when you have a different use year and get different member numbers?
Note I own one contract and am waiting for the right use year/no. of points/price to hit the market to buy my second contract and if I'll get a different member number even if I match use year and names on the deed thus having to deal w/ transfers & the like, then I won't care so much about matching use year.

If it's a separate master there are potential limits including on transferring. Historically DVCMC has been very lenient on multiple contracts of a single owner including allowing multiple transfers and transfers of banked/borrowed points (case by case) but there's no reason they have to be and for non qualified points I could see them being far less lenient. The reality is you might go into it with one set of rules and come out with another. Plus there's never been a guarantee they'd combine them unless one both bought retail and met the other criteria. There have been a handful of examples over the years where they were not combined and should have been. Some have reported DVC refused to combine them after the fact and I haven't seen anyone post they were able to get them combined later. The other issue I see is they could tie the perks to the points used and deny them if a given stay isn't on qualified points. I don't think this is likely but it wouldn't surprise me in the least if they were to do so.

 

[Dean]

It appears someone in theat piror post confused that the unit's being declared to be a commercial unit in the BLT condominium meant the unit was part of the common elements. That is not correct. Any commercial unit that is part of the condominium is, by definition of a "commercial unit," not a common element.

It thus does not resolve the issue of whether Disney can treat TOTWL as a incidental benefit that it can exclude resale purchasers from using. Resale purchasers can be excluded from the use of an incidental benefit, while other members can use it, only if the annual dues to which the resale purchasers contribute are not used to maintain, repair, or operate the applicable incidental benefit. The documents declare that the owner of a commercial unit (which was DVD unless it sold or transfered it to another Disney entity) covers all of ithe operations, repair, and maintenance costs of a commercial unit. However, there could be things in the commercial unit, such as bathrooms, declared to be common elements, or more particularly "limited common elements" usable when using a commercial unit, and the association (and thus owners dues) is responsible for the mainrtrenance of those common elements. Thus, you get into a more complex analysis to determine whether, and the extent to which, resale purchasers can be excluded.

In reality they can do with it as they will. In the absence of legal action it really doesn't matter because they are the proverbial 600# gorilla in this situation.