Intro to Disney Vacation Club

Disney Vacation Club (DVC) – what is it, should I buy it, is it worth it? They are questions I see all the time. Jennelle and I are happy DVC owners who own at both the Polynesian and the Riviera. We’ve only recently joined the club but had been looking into it for many years. My parents have been non-Disney timeshare owners since I was little, so I knew the ins and outs of the traditional timeshare for many years before that. That’s my background, now back to those questions!

What is DVC?

DVC is Disney’s take on timeshares. Launched in the late 90s, it allows vacationers to purchase an ownership stake in the DVC hotels at Disney properties for a large upfront price and a yearly maintenance fee (membership dues). The size of your stake is expressed as a number of points that you are allocated each year that you can spend to stay at a resort. More traditional timeshares have you buy days or weeks, but Disney uses the modern timeshare model of points as it gives owners more flexibility to book different rooms and different seasons year to year. Cost of rooms in points, just like with cash, varies based on several factors including room size, time of year, and which resort. There are a few key differences from other timeshares out there that are worth highlighting:

1. All DVC contracts have an end date. Most timeshares, just like a house, you own forever. DVC contracts have a lifespan of 60 years from when the resort for that contract  was first built. This means when that contract expires, much like leasing a car vs. buying it, you don’t own anything. To date, none of the 60 year contracts have reached their end, so no one knows if Disney will offer extensions or discounted roll overs. But, it’s important to understand there is an end date when purchasing DVC – especially for the oldest properties that will expire in 2042.
2. Disney has the right of first refusal (ROFR) on all DVC resales. This is generally viewed as a huge positive and a big difference between DVC and other timeshares. This means that if an owner ever attempts to sell a contract for what Disney may consider to be too cheap, Disney will swoop in and buy the contract to maintain control over its value. Disney has a vested interest in keeping the resale price of DVC properties within a reasonable range of new/direct sales and this mechanism lets them. Because of this (and a few other factors), DVC contracts have proven to hold their values much better than other timeshares. Historically, DVC contracts have increased in value, whereas many timeshares lose value so fast owners can’t give them away (seriously, go check and you’ll find timeshares listed for one dollar).

Aside from those differentiators, the big thing is: it’s Disney! With the exception of Riviera resale contracts, purchasing DVC gives you access to all of these hotels:

Should I Buy DVC?

This is a complicated question, but sticking to the basics here’s a quick checklist. If you answer yes to all of these there’s a good chance DVC is right for you!

Do you want to stay at Disney at least every other year?

This is the basic starting question, so if you aren’t looking to go to Disney at least once every two years this probably isn’t for you. I say Disney because there are options aside from Walt Disney World like Disneyland and Aulani (their Hawain resort), but generally it’s all Disney and I mostly assume you’re buying for World or Land. There’s some advanced options like renting for those that would only want to go every five years or so…but the 1 in 2 rule is a good starting point.

Do you want to stay on property?

I love to stay on Disney property and find the perks of doing so to be worth the extra expense. If you’re a person that doesn’t care about the transportation, won’t make use of the extra early or late entry times, and isn’t going to buy Genie+ then you won’t get the advantages of staying on property. The savings of staying off property are enough that DVC will never make economic sense. DVC can save lots of money vs. a Disney cash stay, but likely not an off property cash stay. Also, if you’re ok being off property, a non-Disney timeshare is probably available out there that could suit your needs for much cheaper.

Do you want to stay better than Value?

Similar to staying off property, if you only ever want to stay at the Values resorts (Disney’s lowest resort tier), DVC may not save you much money. The actual formula for how much DVC saves vs. cash rooms is pretty complicated. Generally, if you’re happy to stay at a Value resort (excluding the Art of Animation Suites) it can be decades or even never before you see your DVC purchase save you money compared to the cash rooms. Keep in mind, DVC rooms are all Deluxe (Disney’s highest resort tier) so you get a higher tier of room and resort. If that doesn’t matter to you – if your room is just a place to sleep between your time at the parks – it can be hard to find the value.

Is it a financially sound decision?

Purchasing DVC requires a large upfront investment typically in the tens of thousands of dollars. There are programs through Disney and a few other lenders for financing, but that isn’t typically recommended as the interest will eat up any potential savings compared to cash rooms. The question of financing is actually much, much more complicated and you should do more research before making a large financial decision. A good rule of thumb is If you don’t have the cash on hand for the initial purchase, this probably isn’t the right time to invest in DVC.

Can you plan your vacation 7-11 months in advance?

DVC has two reservation booking windows: 11 months for your home resort (the resort where you own your contract at) and 7 months for all other in-network resorts. Depending on the room type and the season, availability can book up fast. That means that you need to be able to plan your vacation and be prepared to book at the 11 month and 7 month windows. If your life or just your personality means you need to be more spontaneous, DVC may not be for you. I’ve heard many stories of folks that book things last minute – grabbing what they can and hopping from hotel to hotel throughout a week – but, I think that’s a unique experience and not the standard.

If you answered yes to all of the above, there’s a good chance DVC is a great option for you – which brings us to the last question.

Is DVC Worth It?

I’m going to start by assuming you answered yes to all the “is it for me questions” above, which means we have established that you are going to Disney at least every two years and staying on property at a Moderate tier resort or better. Let’s look at some rough prices. For a studio room at a Moderate tier resort as a cash stay you will be paying around $2,500 a week in the summer. A DVC studio will be around 150 points depending on the resort. The upfront cost of DVC is around $30,000 ($200 per point) direct from Disney or $22,500 ($150 per point) on the resale market, with an estimated average $1,200 annual dues. If you take the cost to stay at the cash room every year, minus the yearly dues of DVC there’s a $1,300 a year savings.

But DVC has that large upfront cost, which until that is paid off you don’t realize the savings. Dividing the upfront cost ($30,000 direct or $22,500 resale) by the savings you find it takes 23 years and 17 years to break even. After that point you’re saving around 50% a year for a DVC studio vs. a Moderate. When comparing a Deluxe tier resort stay vs. DVC, the break-even is typically in the 5-10 year range. DVC also offers higher tiers of rooms such as one and two bedrooms, and payoff for these tiers is almost always in the 5-10 year range compared to the cash equivalent suites. There are a lot more details about this, such as impacts of financing, the particular hotel you’re buying, cashing out, and the impacts of inflation, but generally speaking DVC is a great value.

Summary

DVC is a great option for those that plan to stay at Disney regularly and have the financial ability to do so. It’s like other timeshare offerings, but with a few extra positives. If you’re looking to buy there’s a lot more to learn (more articles to come!), but hopefully this article has helped you with that initial insight into whether DVC is right for you.

— Dave