I am curious if anyone is doing RV rentals or has considered and done the calculations on this? Obviously owning a giant giant vehicle that sits in your yard 90% of the time (or barn in my case), gets 10 MPG, and adds maintenance time/cost is not very Mustacian, and is one of the reasons i haven't considered this before. However looking at this as more like a small mobile rental property that appears to be able to generate decent ROI and that you get to use occasionally has me thinking about this again. Any help would be appreciated though as I feel like i am missing something obvious.
Details:
I have an opportunity to buy a 2001 33ft Class A RV that looks like it is in excellent shape for $15000. This sold new for $70000 so the worst of the depreciation has already hit. Looking at comparable in my area (WI) it appears that there is a good and growing market for renting these out. looks like the going rate is $150-450 /day depending on type and location. Estimating a 4 mo rental season with 50% occupancy at $200/day - I would be looking at $12000/year in receipts.
https://rvshare.com/ is claiming this is towards the lower end of what people make a year in renting out their RV. Their numbers are a little difficult to sort through, but i believe they claim 90% of all owners (all types of RVs including small pop ups,etc. ) make over $6000/year, and that with a Class A they estimate 15-30k a year. Of course the missing piece here is what are the costs? But even if i spend 50% of my intake in maintenance/insurance/depreciation that would still be a ~$6000/year return on $15000 capital or 40% ROI. Help me if i am majorly missing something here????
Other thoughts of mine
Disadvantages:
- I don't know a lot about RVs in general so that is my major risk. I am pretty handy both with a house (I do almost all my own repairs and reno projects), and a car (do as much work as i can myself as well and i have a lot better facilities now to work in). So these seem to be the two major elements of a mobile house, i am not overly worried about the maintenance but more that i would miss something obvious in the one i am looking at buying.
- Would also have to deal with short term rental time overhead. My wife is pretty good at admin stuff so i think this is something she might be willing/able to do as she is home with the kids 80% of the time.
- Compared to a rental property this would depreciate vs appreciate, and be more work.
- not sure how insurance would work on this? Looks like most personal insurance policies would cover an RV rental, so i could ask people to provide proof of insurance, but obviously there is still risk on my side.
- same as with rental properties this might be better to setup in an LLC which i currently don't have setup.
Advantages:
- possible ROI seems pretty good compared to rental properties, especially for the amount of capital i would have to put in.
- I am in what appears to be a popular weekend camping/RV area with tons of little lakes and camp grounds all around.
- I have a barn and plenty of yard to store the RV if needed.
- My house runs off of LP and I have a septic tank with very good drainage, so with some piping modifications i should be able to fill/empty RV on site as needed to reduce costs.