I'm not 100% of all the details, but in general ya. Any DVC inventory room not rented at 60 days automatically becomes available to book for cash to the general public. All or a portion (not really sure) of the revenue for this goes back to the owners (in the way of reduced maintenance fees). However, there is an annual cap. Once the cap gets exceeded, all the revenue goes to Disney. From my understanding, they basically hit the cap every year.Can someone explain to me more about breakage? Are you saying that any cabin at CCV not rented at 60 days can be rented out for cash and nothing goes back to DVC? Sorry if I am misunderstanding...
Can someone explain to me more about breakage? Are you saying that any cabin at CCV not rented at 60 days can be rented out for cash and nothing goes back to DVC? Sorry if I am misunderstanding...
To expand further @CanadaDisney05 is correct on all points. Unreserved units at 60 days (DVC also has the ability to "predict" the rooms that will be unreserved at 60 days) are sent to CRO to be booked. That cash then gets returned back to the association, which the unit belonged, to offset/lower the dues. However, it is capped at 2.5% of the associations budget (as referenced above). Next the breakage goes to BVTC, the entity responsible for trading at 7 months, up until a X multiplier of their realized costs, this is essentially how DVC funds BVTC (outside the nominal fees each resort pays). Any money that exceeds X of the realized costs of BVTC and 2.5% of the dues is then given to DVD.I'm not 100% of all the details, but in general ya. Any DVC inventory room not rented at 60 days automatically becomes available to book for cash to the general public. All or a portion (not really sure) of the revenue for this goes back to the owners (in the way of reduced maintenance fees). However, there is an annual cap. Once the cap gets exceeded, all the revenue goes to Disney. From my understanding, they basically hit the cap every year.
I'm an OKW owner and I have serious concerns about these annual dues increases. Not just OKW but all DVC dues. I ran some numbers based on OKW. If you were to take the dues and give them a modest 7% (modest compared to the proposed 8.4% increase for 2020) annual increase each year until 2057, when my contract expires. My 2057 rate shows $95.79/point. That obviously is to the extreme. If you were to make it a 4% (which seems very possible) increase annually it would be $33.44/point. Which is still an insane amount of money.
I have heard, read what ever that there are some timeshares that people own that they could not give away if they tried. Could it be because the dues are so high and just not worth it?
Unreserved units at 60 days (DVC also has the ability to "predict" the rooms that will be unreserved at 60 days) are sent to CRO to be booked.
When does that prediction happen? Not before 7 months right? So your home resort if booking prior to that you won't have Disney essentially stealing rooms.
To expand further @CanadaDisney05 is correct on all points. Unreserved units at 60 days (DVC also has the ability to "predict" the rooms that will be unreserved at 60 days) are sent to CRO to be booked. That cash then gets returned back to the association, which the unit belonged, to offset/lower the dues. However, it is capped at 2.5% of the associations budget (as referenced above). Next the breakage goes to BVTC, the entity responsible for trading at 7 months, up until a X multiplier of their realized costs, this is essentially how DVC funds BVTC (outside the nominal fees each resort pays). Any money that exceeds X of the realized costs of BVTC and 2.5% of the dues is then given to DVD.
I forget the X multiplier but it is easily found in the DVC Resort Agreement Addendum to your POS.
So could this be a big factor in CCV dues not increasing as much as other resorts?
is there anyway to audit? (Are we entitled?).
maybe it’s been covered but is that a motivating factor for DVD doing the cabins and bungalows? They know the cabins will go not be booked...
both poly and CCVs dues don’t seem to be going up?
Not a factor that relates to comparing dues increases among resorts. Since beginning of DVC time, every resort for every year has gotten that 2,5% set off due to breakage income so no resort has benefited more than others. As I was informed by a DVC person at an annual meeting some years ago, the annual breakage income has typically exceeded the 2.5% plus the amount that goes to BVTC, leaving an excess amount that is just Disney profit. The bungalows and cabins gave DVC not just a lot more breakage income, but a huge number of extra points it could sell to all those members purchasing only enough points to get studios.
if Disney is intentionally creating the bungalows and cabins just to create to increase profits for themselves via a back door (breakage) that seems so unethical to me.
I have no problem with Disney being totally profit hungry, but that seems fraudulent to me and against the spirit of the agreement if it is premeditated.
There is general consensus here that the bungalows were created for this reason. A few DIS members (Drusba and SkierPete in particular) predicted what would happen right when the point chats were published and their predictions proved true.if Disney is intentionally creating the bungalows and cabins just to create to increase profits for themselves via a back door (breakage) that seems so unethical to me.
I have no problem with Disney being totally profit hungry, but that seems fraudulent to me and against the spirit of the agreement if it is premeditated.
So, with the unused points from the bungalows and cabins, does that create a bubble or overhang of unused points that keeps getting banked forward? People obviously book other resorts, but I assume that pushes other resorts points into the bubble and so on? People can’t use their points so they bank to the next year. Correct?
the more resorts they continue to build that creates breakage the bigger the bubble and the resulting consequences to the system?
I think what it means is that those that own at Poly and CCV are using points from those home resorts for accommodations other than cabins/bungalows. This, in turn, floods the system with points competing for other room sizes.
Some of that breakage is owners using their points for cruises, concierge collection, RCI, etc.....But the resorts whose CCV/Poly points are being used on, have points allocated to it and so on...
it seems systemically the breakage in general creates a bubble of points that can not be used at the end of the year. When you have multiple resorts with a large amount of breakage then you end up with a large bubble of points that have no home that need to be pushed forward....
is there anywhere that DVC discloses breakage by resort?
But the resorts whose CCV/Poly points are being used on, have points allocated to it and so on...
it seems systemically the breakage in general creates a bubble of points that can not be used at the end of the year. When you have multiple resorts with a large amount of breakage then you end up with a large bubble of points that have no home that need to be pushed forward....
is there anywhere that DVC discloses breakage by resort?
it seems systemically the breakage in general creates a bubble of points that can not be used at the end of the year.