How easy is it to rent out points?

Perloo

Earning My Ears
Joined
Mar 18, 2020
I'm curious more about "typical" rental experiences, not necessarily the next 3-6 months of post-coronavirus challenge (though I'm open to that insight as well). But in general, how easy is it to rent out any unused points?

Assume I go through a broker, so it's not so much the logistics of multiple communications / requests, but moreso just the odds of having someone looking for the exact number of points I have to rent, or at least something close enough that I don't strand 30 or 40 points. Not a current DVC member, but considering something in the 100-150 pt range.

And does the likelihood of finding renters increase or decrease once you get past the 11mo home resort advantage? (I.e., once you get into 7mo timeframe or closer.)
 

_auroraborealis_

I like marshmallows. And adult beverages.
Joined
Oct 18, 2015
I think it's worth bringing in mention of coronavirus, because renters with reservations during this closure, and in the near (uncertain) future have been finding that Cancel for Any Reason insurance doesn't include pandemics, and "final and not refundable" seems to include "even if the resort is closed and you're getting nothing!"

This may constrict the market for some time, particularly if economic recession comes into play. A non-refundable, unchangeable sunk cost reservation may be seen as quite risky for the next 12-24 months.

Prior to now, renting points has been pretty easy. Someone won't be renting your exact number of points, and you need to be flexible about borrowing or losing a few points.

Plenty of people try to rent throughout the reservation cycle. The challenge is simply if you can make a successful booking outside of home resort for something someone wants. The average renter is still going to come in at 6 months requesting BWV Standard or AKV Value, and that's not realistic. Some times of year, Saratoga will be, but they won't want that.
 

LAX

DIS Veteran
Joined
Mar 13, 2016
In good times, it's fairly easy. During the next 6-12 months, I think it's going to be difficult. Between renters losing confidence in the rental market (see threads discussing renters losing out even when resorts are closed) and the economy likely going to tank in near future, interests in renting DVC will likely plummet, IMHO.

As far as the actual rental process, it's pretty straight forward. You tell the brokers (I have only rented through one & assume others operate similarly) how many points you want to rent and they will try their best to match up a reservation that best use those points. It's difficult to line up the actual number of points needed for a reservation to the exact number of points you want to rent, but if you are willing borrow a few extra points (or can bank a few extra), it's unlikely you will lose any point.

LAX
 
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  • Matty B13

    DIS Veteran
    Joined
    Jun 13, 2016
    You can also try renting out your own points here on Disboards on the Rental Thread. I have had good luck since 2016 with renting out points, but I also don't do it very often.

    With the current mess, the rental market is going to be tough this year, and possibly for years to come. I wouldn't buy excess points with the thought of renting them out, because Maintenance Fees generally go up every year, but the price for rental points doesn't increase at the same rate. I didn't own DVC back in 2008, but some of the owners back then were barely getting prices to cover maintenance fees.
     

    CaliAdventurer

    To Hunger is to Live
    Joined
    Oct 27, 2014
    The brokers may not even exist next year. Plan to rent solo which is oddly now "safer". Rentals were going for $20pp until the other week. It's all in the air now.
     

    Deb & Bill

    DVC-Trivia Contest, Apr-2006: Honorable Mention
    Joined
    Mar 20, 2000
    If you do choose to rent out your points, make sure you don't take any reservations during the last four months of your UY so you can bank any current year points. And any banked points need to be used for rented reservations very near the beginning of your UY, so that cancellations allow you to either use or re-rent those points. I think a lot of owners who rent their points learned a lot of lessons from this mess.
     

    Sandisw

    DVC Forums
    Moderator
    Joined
    Nov 15, 2008
    The brokers may not even exist next year. Plan to rent solo which is oddly now "safer". Rentals were going for $20pp until the other week. It's all in the air now.
    I would bet most owners will include a clause for closures now and I think less renters will be willing to book at rental at those rates if it includes a clause that all will be lost, even if the resort closes,
     

    CaliAdventurer

    To Hunger is to Live
    Joined
    Oct 27, 2014
    I would bet most owners will include a clause for closures now and I think less renters will be willing to book at rental at those rates if it includes a clause that all will be lost, even if the resort closes,
    This is why its so unfortunate that owners are not being magnanimous to renters, especially when the renters know they are getting their points back- they cant ALL be expiring banked. The faith will be lost and the prices for rentals will be well depressed. I wonder though if it won't drive more renters to be owners if the resale prices drop significantly.
     

    Deb & Bill

    DVC-Trivia Contest, Apr-2006: Honorable Mention
    Joined
    Mar 20, 2000
    This is why its so unfortunate that owners are not being magnanimous to renters, especially when the renters know they are getting their points back- they cant ALL be expiring banked. The faith will be lost and the prices for rentals will be well depressed. I wonder though if it won't drive more renters to be owners if the resale prices drop significantly.
    Owners only get about 50% of the money the renter pays. The brokers have the rest, either as being held for the owner or for their payment for the deal. The broker should give up the money they made in the deal if the points owner has to give up their money. Plus many of the owners have already used the money they have been given so far, either for their own vacation or some other pressing need. If they aren't working, they might not even have the money they need for normal living expenses..

    Even if resale points drop significantly, DVC might still resort to ROFR and buy back those cheaper contracts for sale.
     

    CaliAdventurer

    To Hunger is to Live
    Joined
    Oct 27, 2014
    Owners only get about 50% of the money the renter pays. The brokers have the rest, either as being held for the owner or for their payment for the deal. The broker should give up the money they made in the deal if the points owner has to give up their money. Plus many of the owners have already used the money they have been given so far, either for their own vacation or some other pressing need. If they aren't working, they might not even have the money they need for normal living expenses..

    Even if resale points drop significantly, DVC might still resort to ROFR and buy back those cheaper contracts for sale.
    I totally agree. I wouldn't expect an owner to give a refund but they can be expected to may a real effort to reschedule or an explanation and proof that their UY expired with banked points.
     

    TraderSamWDW

    The Head Salesman
    Joined
    Feb 24, 2020
    This is why its so unfortunate that owners are not being magnanimous to renters, especially when the renters know they are getting their points back- they cant ALL be expiring banked. The faith will be lost and the prices for rentals will be well depressed. I wonder though if it won't drive more renters to be owners if the resale prices drop significantly.
    I have thought about this. I would give a renter their money back if I could bank the points - or do something where I do not lose them but gives me an acceptable result - MAYBE less 10% for my time of some nominal fee.
    Then I think when would I actually rent out points (since I have never done it) and my answer to that is if I needed the money (which is now an issue, because I probably have already spent it) or if the points were banked and in danger of breakage.

    If I could give the money back I would, I just wonder how many renters are in that position. I certainly would try to reschedule for the renter.
     

    CaliAdventurer

    To Hunger is to Live
    Joined
    Oct 27, 2014
    I have thought about this. I would give a renter their money back if I could bank the points - or do something where I do not lose them but gives me an acceptable result - MAYBE less 10% for my time of some nominal fee.
    Then I think when would I actually rent out points (since I have never done it) and my answer to that is if I needed the money (which is now an issue, because I probably have already spent it) or if the points were banked and in danger of breakage.

    If I could give the money back I would, I just wonder how many renters are in that position. I certainly would try to reschedule for the renter.
    Surely, some will be unreasonable but I think given the circumstances folks just want to see a good faith effort. If the points are lost- everyone is out- so it goes. If they can reschedule, they should. I don't imagine refunds are easy to give months later unless you have those kinds of resources. A fee for the hassle seems fair since it is a not nothing in time.

    We're going to see very explicit contracts here on out. Nobody expects the Spanish Inquisition!
     

    Perloo

    Earning My Ears
    Joined
    Mar 18, 2020
    You can also try renting out your own points here on Disboards on the Rental Thread. I have had good luck since 2016 with renting out points, but I also don't do it very often.

    With the current mess, the rental market is going to be tough this year, and possibly for years to come. I wouldn't buy excess points with the thought of renting them out, because Maintenance Fees generally go up every year, but the price for rental points doesn't increase at the same rate. I didn't own DVC back in 2008, but some of the owners back then were barely getting prices to cover maintenance fees.
    Is this true? (Hear that in a curious tone, not an accusatory tone, since I am new to this and really don't know.) I feel like I've read a lot about how rental prices have also gone up at a decent clip over the past 10-15 years. As I've tried to model out some of the financial implications of owning, and then potentially renting unused points, I have made the assumption that both inflate at roughly the same rate. If that's a bad assumption that could have a meaningful impact on the analysis.
     

    Matty B13

    DIS Veteran
    Joined
    Jun 13, 2016
    The rental market is a mess right now, some brokers might go bankrupt. Prices might go down or up, no one really knows right now. So if it was me, I wouldn’t count on rental income in your analysis. I would do a lot more research before making any large purchases.
     

    Hokie2005

    Earning My Ears
    DVC Gold
    Joined
    Mar 2, 2010
    Is this true? (Hear that in a curious tone, not an accusatory tone, since I am new to this and really don't know.) I feel like I've read a lot about how rental prices have also gone up at a decent clip over the past 10-15 years. As I've tried to model out some of the financial implications of owning, and then potentially renting unused points, I have made the assumption that both inflate at roughly the same rate. If that's a bad assumption that could have a meaningful impact on the analysis.
    As long as Disney raises their cash rates for rooms, you can reasonably expect price/pt to increase appropriately. Those renting the points are doing it because they want a room at a discounted rate. They always have the option to go straight through Disney to rent a room. By going through Disney, they would be provided additional protections for a refund should a situation like we are currently seeing happen. Yet people are looking to save money and thus turn to the DVC rental markets. As long as people keep going to Disney and Disney keeps raising their rates it is a reasonable assumption that DVC rental rates would continue to increase. Still a deal for someone looking to stay on property. But it is on the renter to protect themselves per the contract they are agreeing to. Yes the current situation is unfortunate but so are most situations that would have people cancel a big Disney vacation. I certainly would try and accommodate moving the reservation before the points expiration but an owner shouldn't feel guilty for not giving a refund if it isn't specifically written in the contract.

    I would not buy into DVC thinking I would be renting points though. I would buy keeping in mind the banking/borrowing and do so thus so I didn't have to rent any points. Obviously life events happen where you might not be able to use points for a time period and knowing the rental market is there is certainly great for that.
     

    LAX

    DIS Veteran
    Joined
    Mar 13, 2016
    The rental market is a mess right now, some brokers might go bankrupt. Prices might go down or up, no one really knows right now. So if it was me, I wouldn’t count on rental income in your analysis. I would do a lot more research before making any large purchases.
    I agree rental income should never be counted on as an income stream to cover dues or other expenses. I personally consider the rental market as a last resort where I have to change plans on some occasions and end up not using the points myself. That's also why I have a relatively small contract.

    LAX
     

    DVC Doctor

    Member since 2001
    DVC Gold
    Joined
    Mar 19, 2014
    If you do choose to rent out your points, make sure you don't take any reservations during the last four months of your UY so you can bank any current year points. And any banked points need to be used for rented reservations very near the beginning of your UY, so that cancellations allow you to either use or re-rent those points. I think a lot of owners who rent their points learned a lot of lessons from this mess.
    great advice!!!
     

    Deb & Bill

    DVC-Trivia Contest, Apr-2006: Honorable Mention
    Joined
    Mar 20, 2000
    Rental price per point was stuck at $10 a point for years. Dues continue to go up and are now in the $7-8 a point range. Many owners rented out their own points. One broker acted as am associate on an owner's points to make the reservations. DVC got wise and limited the number of contracts a person could be an associate. The new model of finding people wanting a reservation and matching them up with owners arose.

    The point brokers were part of the reason for the price per point to go up. They needed points to rent out and they needed to pay owners to get the use of those points. Plus they wanted their cut. Prices rose to about $15 a point quickly with owners getting about $11-12 a point. With more brokers getting into the game, there was a lot of competition for owners. Thus, the price per point started to rise even more so owners could be paid more. The guy paying the owners the most was able to get the most owners and make the most rental deals. At first the owner got 50% of the payment to make the reservation and the other 50% when the renter checked in. Again, to get more owners, the amount paid out to owners immediately increased.

    So that's a quick history of renting.
     

    _auroraborealis_

    I like marshmallows. And adult beverages.
    Joined
    Oct 18, 2015
    I do think some of the flexibility is going to suffer. Depends on people's willingness to accept risk. You may now have to provide lower pricing on points that are for bookings in the last 4 months of UY or are banked/borrowed even if booking 11 months out.
     

    CarolMN

    DVC Co-Moderator
    Moderator
    Joined
    Aug 18, 1999
    And if a lot of the brokers go out of business due to COVID-19, I can't help but wonder what that will do to rental prices. It wouldn't surprise me if they fall - maybe even a lot.

    Another risk to consider for those who think buying to rent is a good strategy. YMMV.
     

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