fifth wheel depreciation

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trak09

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Wanting to know the depreciation on my 27' Forest River Rockwood Signature Ultra Lite fifth wheel that is four years.  Used little. Many extras and some never used-generator, outdoor barbecue grill and outdoor shower.  Upgrades and A/C.  The dealer told me that it was worth about 1/2 of its original price.
That's 50% dep. in four years.  What is your opinion.
 

Back2PA

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I would suggest checking RV Trader, PPL and RVT to get a sense of the average of what others are asking. The dealer may be in the ballpark on a trade-in basis. A wild guess might put a private party sale at 60-65%
 

sadixon49

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That doesn't sound out of line to me. Sun to Retire is probably right, in a private sale you might get 60% to 65%, but a dealer isn't going to give you that, because that's what he can sell it for, and he needs to make a little on the transaction. The only thing that depreciates faster than an RV in it's first 4 years is a boat with a large hole in the bottom.
 

Gary RV_Wizard

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If "original price" means the MSRP when new, then his estimate is fairly close.  Since its a dealer, he is probably talking wholesale value, not retail. If you were asking what he would give you for it, wholesale is what he is saying.

An RV depreciates about 25-30% from MSRP as soon as the title is issued. Then its about 6% per year thereafter.  Top condition helps some, but not a lot unless it is a very popular model.
 

2PawsRiver

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Also depends on what price you got into it for.  We are looking at 2018 Fuzion 424s and currently see the exact same fifth wheel ranging in price for just of 70,000 to 113,000......I would imagine if you bought it for 113,000 and didn't even use it anybody looking would want to pay less then 70,000.
 

Gary RV_Wizard

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A big part of the horrendous first year depreciation is merely recognition of the discount most buyers get from MSRP.  If you actually paid only 80% of MSRP, the true depreciation is much less.  Since there is no reporting system to collect actual RV selling prices, NADA (or other RV pricing book) has no way to get average actual selling prices, whether new or used, so pretty much everything you see is guesswork estimates.
 
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I am also looking to check the depreciated value of my 3 years used RV and found this article https://www.crowsurvival.com/rv-depreciation/. You can also see the depreciated value of your one here but do you think these are entirely right? I think RV dealers could tell us more clearly.
 

Gary RV_Wizard

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The crowsurvival article is a thoughtful analysis, but it is based entirely on NADA RV book values and those lack any actual sales data to validate.  It's hardly surprising that the depreciation analysis shows a steady rate of decline, cause that's how NADA calculates the values. Note that I said "calculates"; the values are not derived from dealer or auction sales reports (because there are no such reports).  The folks at NADA have no doubt done some research to come up with their depreciation estimates, though.  Experience shows the NADA prices are in the right ball park but not very accurate for any given model or year.  It's not unusual for the actual price of a given RV to be 10-20% higher or lower than the NADA estimated value.  Especially for older RVs in top condition (condition is much more important than age or mileage in RV pricing).
 

MichaelInMA

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Mostly looked at towables but found the price on new one fluctuated dramatically.  When you shop around you can easily get 1/3 off the MSRP.  More than once when we looked somewhere and picked something we liked we got around a 20% discount when we tried to walk away to look at other places.  In one case where we did not find anything we liked we were offered a 50% discount on something similar. 

We also found huge seasonal fluctuations.  The best prices were in October and November.  We did not look in December.  The highest were in January, February, and March.
 

KandT

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This ties in with the thread I started about the whole industry slowing down.  Two years ago when we saw a Tiffin online it was scooped up right away if they were asking close to NADA.  Now you can see tons just sitting there. 

I think though the industry has to go through a wash out phase because many, many people will owe more than their RV is worth.  I will be very interested and watching closely how the market changes in the next 18 months!!
 

Texdan25

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Gary RV_Wizard said:
A big part of the horrendous first year depreciation is merely recognition of the discount most buyers get from MSRP.  If you actually paid only 80% of MSRP, the true depreciation is much less.  Since there is no reporting system to collect actual RV selling prices, NADA (or other RV pricing book) has no way to get average actual selling prices, whether new or used, so pretty much everything you see is guesswork estimates.
Good info Gary.  So I'm looking at a 2019 Grand Design fiver with an MSRP of $54000.  Dealer has it discounted to $41000 which is a 25% discount.  How would I estimate the upcoming depreciation on this, in other words would this be a 'good' deal or would I still take a big depreciation hit the first couple of years?
I found this post from you back in 2013.  So if you get a 25% discount off the MSRP on a new trailer does that basically nullify the 1st year depreciation?

'The first year hit on an RV is very large vs the MSRP - probably 20-30%. Some of that is the fact that RVs are often heavily discounted, some of it is the usual premium for new vs used, and some of it is just normal depreciation. For RVs, NADA uses the basic depreciation rate of 6% per year after the first year.. And most people feel that they would buy new as opposed to used if the price was within about 10%, thus a 10% "premium" for new vs used, even if the exact same model and year.'
 

Gary RV_Wizard

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If you get a good enough discount, you can effectively erase much of that first year loss of value as shown in NADA or Black Book. The market value of the RV at the end of the 1st year is the same whether you get a discount or pay MSRP, but the effect on your personal financial situation is less if you get a steep discount.  If the price you actually paid is close to the estimated market value, you personally will probably lose very little.
 

SpencerPJ

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I agree, but also keep in mind, RV's are terrible investments, I hope your not buying new, plan to use a year, and think you will almost recoup all your investment.  Not going to happen.  Many / most will say, buy a used unit, the almost guaranteed 'new' factory flaws and bugs will be worked out, and a big chunk of the depreciation will be absorbed by the original owner.
 

Texdan25

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SpencerPJ said:
I agree, but also keep in mind, RV's are terrible investments, I hope your not buying new, plan to use a year, and think you will almost recoup all your investment.  Not going to happen.  Many / most will say, buy a used unit, the almost guaranteed 'new' factory flaws and bugs will be worked out, and a big chunk of the depreciation will be absorbed by the original owner.
We are planning on keeping it for a LONG time.  But after discussing with my significant other we've decided to keep what we have for now (2015 Jayco White Hawk 27DSRL bumper pull) since it's in great shape with new Goodyear tires and shop used.  We are in no hurry for a fiver at this time, just got caught up in new 2019's since 2020's are coming out.  We already took the depreciation hit on the Jayco, might as well let someone else take the hit on our next trailer!  And we have been focused in on Grand Design due to the high quality, haven't really investigate other brands.
 

KandT

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Since it seems like the OP got a variety of answers can I ask the depreciation question?  So a 2019 RV I am looking at has an MSRP of $180,000.  Now the 2020 are out and the new 2019's are being advertised for $120,000.  What is a good mark to shoot for off of this price.  Has the manufacturer "reset" the MSRP to $120,000.  It is uncanny how you can find this RV all over the country for the same price so I assume the manufacturer has dictated some sort of pricing???
 

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