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Old 10-19-2015, 07:55 PM   #1
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Default Class B RV Depreciation Perspective

I have owned my share of cars over the years and have never owned a pre-owned vehicle. I have usually rationalized in my mind if I get 10 years of use out of a car, I feel I got my monies worth.

I've seen many owners on this site upgrade / trade their RVs pretty 'fluidly'. Many Class A RVers I have spoke to have said they have to hold on to what they have because the depreciation hit is so great.

Others have said "Buy your last RV first" and they purchase a $250K+ diesel pusher and intend to get 200K miles out of it and hold onto it for a while.

Based on the 2016 Winnebago ERA refresh, a 4x4 ERA 70 X with all the options will be about $150K out the door. This is starting to approach starting Class A money.

Does the Class B resale market work under a different set of rules? Is depreciation less and demand greater?
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Old 10-19-2015, 09:01 PM   #2
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How do you figure? The Era starts at $120k plus the 4x4 option of around $8k. There are a few options you could get that might add another $2k. So $130k tops MSRP.

The actual trading prices are 75-80%. So you are looking at $97,500-104,000. Granted, it's still not cheap, and there are Class A's out there for that kind of money.

But to answer your question, depending on which model you get, time of year, etc., they do have their own set of rules. I've found the depreciation to be minimal. Also, you can probably get more for a newish B selling it yourself than trading it off, but it takes time and patience, and some luck.
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Old 10-19-2015, 09:16 PM   #3
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I have motorcycles- it is amazing how owners often refer to their stuff as an "investment- or a new part or chrome geegaw as an investment.

it is an expenditure.

and the money goes away and never comes back


i think that some owners consider their B worth gold and wonderful- but my experience last year showed that a B sitting on the market for months- and displaying to the seller what the insurance value is- lead to a reasonable exchange.

because the B is an RV and not a daily driver ( for most) it will not suffer the daily wear and tear and dings- so a 10 year old B is probably in better shape than a car.

so it may not depreciate as quickly but it will.

and I would expect more efficient vehicles will hasten the decline of less efficient- both in use of space, energy and features.

buy the best you can, don;t go into debt.



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Old 10-19-2015, 10:47 PM   #4
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How do you figure? The Era starts at $120k plus the 4x4 option of around $8k. There are a few options you could get that might add another $2k. So $130k tops MSRP.
Maybe I should have been more clear - Out the Door usually includes everything - including taxes

Options from WGO Build Sheet
  • 4x4 Option - $11116
  • Better Inverter - 2000 watt $700
  • Additional Solar Panel - $400
  • Blindsight Detection / collision Avoidance Option - $1000
  • Alcoa Wheels - $2149
  • Optional Cabinet (70X) -$400
  • Infotainment - $1600
  • Dealer Prep - $1000

$138365

CA Bay Area Tax Rate 10%

$152201

I'm hoping to get between 10-15% factory order discount - not sure if a new product will result in a nice discount.
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Old 10-19-2015, 11:45 PM   #5
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Holy crap! 10%? Where I live the tax is 6% up to a cap of $300. Yes, $300!

Interesting those prices. You may be paying more because of your dealer/where you live.
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Old 10-20-2015, 02:40 AM   #6
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Holy crap! 10%?....

Most of Arizona is about 9.25%.

state tax and municipal taxes are collected...the "cool" part is that many of these dealers do not have to pay all those taxes to the kitty, but may keep a portion as an incentive to be on one side or the other of a boundary line.

AZ doesn;t collect taxes on private party sales on used vehicles ...so a "saving" to the buyer there.

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Old 10-23-2015, 01:07 AM   #7
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Here in TX, they want their 6.25% cut, so that $110,000 ERA is going to be about 120k for me. For 4WD... I'd say it is worth it, just because of the added ground clearance.
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Old 10-23-2015, 11:30 AM   #8
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Kiss 13% tax on the purchase price goodbye here. Yup, 13% on any vehicle you register in your name.

Depreciation is very real. You can minimize it by not overpaying for the RV in the first place. Some models seem to escape the worst of it. I think early Travato owners will be in that group. Price inflation on the new and improved Travatos would go a long way in offsetting depreciation on the old units is what I'm thinking. That's what happened with the early Views & Navions from what I observed.

People tend to forget the value of the lost opportunity on the money expended. $120,000 earning a 4% dividend would pay you $400 per month. The new $120,000 RV in the driveway might depreciate at the rate of $1,000 per month initially. Factor in the cost of interest if you don't pay cash.

Sprinter Class B's in general have fared well if asking prices on used units are accurate. I do see some units listed and relisted more than once in used RV ads though. Owners appear to be more interested in getting their price than selling the unit.

I look at what the same model asking price is when it is two or three years older. On one 7 year old unit I was interested in (several listed at similar price) the 10 year old units asking prices (again, several examples) indicated that the depreciation hit was still going to be $7,000 per year until year 10. Too much for me to consider.
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Old 10-23-2015, 12:14 PM   #9
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Yep. Everything has a price. There are upsides to have a new unit that can offset the depreciation costs, as well as downsides.

Sometimes buying an older unit is just cost shifting, not cost savings. Trading upfront cost for repairs and modernization/upgrade costs later.

So you have to assess your appetite for risk, as well as peace of mind. So far I've had very good fortune on the cost front.

It will be interesting to see if these Etreks and Eco Treks are going to suffer depreciation above or below the norm. Not sure the market has had enough time to digest the info yet.
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Old 10-23-2015, 01:04 PM   #10
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Quote:
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Sometimes buying an older unit is just cost shifting, not cost savings. Trading upfront cost for repairs and modernization/upgrade costs later.
I honestly don't think that that statement is true. As a statistical statement, it is ALWAYS cheaper to buy used. The "drive it off the lot" depreciation is just so high that no amount of repair cost will ever cancel it out. Of course, it is only a statistical statement, so any individual can get lucky. Don't count on it, though.

"Upgrades" are perhaps an exception. But, that isn't really the same thing, since you are ADDING to the vehicle, not simply maintaining it. There can be no general statement about this, since there is no limit on how much one can spend on upgrades.

I am not arguing against buying new--that is what we do. But the arguments for doing so are not economic.
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