Buying a new RV feels like making a wish come true. Your new road machine gets you where you want to go. It gives you a freedom others only dream about.
But those dreaded words: buyer beware. Buying an RV does come with a downside, and it’s one you face when you’re ready to sell your rig: depreciation.
Depreciation is the amount of value an asset loses over the course of you owning it. RVs lose their value relatively quickly, at a steep rate of depreciation. Depending on how much you plan to use your RV, and over what period of time, you can recoup some of those costs.
Fair Market Value Depreciation
Depending on the deal that you got when you bought your RV (Here’s some great background on that topic from Jason Wynn ) you’ll probably lose around 30% off of the manufacturer’s suggested retail price just for driving your new RV off the lot. Compare that to the around 19% average of a new car.
Or 25% of a new boat. When it comes to RVs, the first year is the biggest hit you take. If you hold on to your rig year over year, the rate of value loss slows down. After 10 years, you will be able to recoup about a little under half the value, which isn’t bad if you use it a lot…though a decade is a long time for some to store and hold on to an RV.
Renting can be a way out
One of the ways to fight depreciation is to put your RV to work for you and rent it out. Why should it sit on a storage lot for nine-tenths of a year when it could actually be earning money while helping to pay off the loan?
The other rental solution is to not buy and instead to rent an RV for your travels. You’ll get the comforts you want while following your dreams, and you’ll never have to worry about depreciation.