Disney World is one of those places that most people love or hate. I happen to fall into the former category, but even if you fall into the latter, or don’t spend time focusing on Disney, a recent statistic I heard really surprises me. Amidst the COVID-19 pandemic over the past 6 months, travel is down significantly. Disneyland in California hasn’t even reopened yet, though Disney World has been open for a few months now.
For the past 20 years, Disney has had their own timeshare program, dubbed Disney Vacation Club. Our family are owners there. We have a bank of points that we can use at any Disney Vacation Club resort in the country. And, like other timeshare programs, we can transfer those points elsewhere if we don’t want to vacation at Disney. But, the reason to buy into Disney Vacation Club is because you love Disney and you intend to visit frequently. We’ve saved significant sums of money over the years on Disney vacations. During those times when we haven’t used all our points, we were able to rent them out to someone else to make sure they got used.
People Are Still Buying Timeshares During The Pandemic
I would have guessed that demand for timeshares would have plummeted during the pandemic. I just can’t imagine anyone would want to purchase a timeshare at full price right now. I’m wrong. Very wrong.
Disney Vacation Club has a number of ways to market to potential new customers. One of the biggest ways they market is through the theme parks. Right now, Disneyland is closed, so no opportunity to sell there. At Disney World, it appears all the sales centers are currently closed for meetings with potential buyers. Some model units are open, but the high-touch guided tours and sit-down meetings aren’t happening. Disney Cruise Line is also another source for new timeshare owners, but none of the ships are cruising. It appears the only way to purchase a timeshare from Disney right now is via phone, live chat on the website or e-mail.
From a source inside Disney, I’ve learned that Disney Vacation Club sold more than $10 million worth of Disney Vacation Club points last week.
These purchases generally require a significant investment. When purchasing points, new Disney Vacation Club owners will generally pay $125 per point or more, depending on which home resort they pick. The number of points purchased likely varies greatly. Some people are looking to be able to have family reunions every year and might purchase hundreds of points. Others are just looking for the ability to take the occasional vacation, and can get by on 100 points. Still others might be existing owners who are just looking to add-on to their existing timeshare ownership.
If we were to say an “average” purchase is 100 points, that’s $12,500. $150 is more likely, so let’s call it $15,000. That’s still 750-ish buyers on $10 million in sales (keep in mind the actual sales number exceeded $10 million last week). Even if the average were 200 points, or the purchase price per point was higher, it’s still safe possible there were at least 500 buyers.
These Buyers Are Paying Full Price
Disney Vacation Club traditionally offers very little in the way of discounts or incentives for purchases. They’ll knock a few bucks off here and there, but they don’t discount nearly as much as other timeshare sellers. And, there’s a very robust secondary market for DVC points contracts. You can buy points for a decent discount off of Disney’s prices. Buying points on the secondary market means you don’t get some benefits that purchasers get when buying directly from Disney Vacation Club.
However, during tough economic times, timeshare contracts are one of the assets that people in financial distress dump first. With annual dues average $5 per point or more and the need to pay for flights and park tickets, a Disney timeshare isn’t the most valuable thing in a recession. I would expect that the longer we have high unemployment the more we’ll see prices drop in the secondary timeshare market.
The Final Two Pennies
Unemployment remains high while travel is still nowhere near recovered. Disney World is at limited capacity and still doesn’t fill up on virtually any day right now. Yet hundreds of people plunked down five-figure sums of money to purchase timeshare contracts from Disney. That shows an incredible resilience of the Disney brand in very troubling economic times. I wouldn’t have expected that.
According to reports, consumers are saving more money right now. People should be less likely to complete discretionary purchases like second homes, timeshares, etc. Even in challenging times with a significantly reduced ability for marketing, Disney seems to be attracting folks to invest in the long-term.
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