How Much Does It Really Cost to Own an RV?
The cost of owning a motor home, travel trailer or camper goes far beyond the purchase price because what people pay to buy only represents the beginning of their overall expenses.
While there is no exact figure that represents what RV owner's pay, it's fairly easy for someone with experience to estimate general expenses.
5 Things That Affect How Much People Have to Pay to Own RVs provides additional owner cost information to that which is discussed here, so if you read both, you'll get a more complete picture.
The purposes of this article is to help you gain an understanding about ownership costs so that you don’t run into problems if you decide to make a purchase.
Differences in the Costs for Storage, Taxes and Payment Options
There are a number of issues that affect how much individuals pay to own and use their travel units.
1. Someone who has storage facilities on his own property parks at no cost, but an individual who rents a spot can pay up to $2500 per year!
2. A person who can pay cash to purchase his coach spends thousands of dollars less than someone who must finance because he avoids paying fees for the interest on his loan.
Also, your state of residence determines how much sales tax you pay.
- In one state the sales tax is 6%. So, if a buyer pays $100,000 for a coach, he pays an additional $6,000 in sales tax.
- In a state that charges 9%, that tax bill rises to $9,000.
Thus, where you live can cost you thousands of dollars more (or save you the same amount) when you purchase a coach.
Some recreational vehicle owners have to pay property tax, but others do not. For example:
Those who rent their spots in a private or public park pay nothing for property taxes because they are already figured into their daily, weekly monthly or yearly camping fees.
Those who own their lots or acreage get billed only for the land unless they develop it and/or they permanently attach their coaches to it.
The smaller the size of the property, the less one pays, but owners who live near popular areas or large cities always pay more.
You can easily check these costs by searching the property appraiser's website in your area or by contacting a local real estate agent.
The highest average state property tax rate in the nation is in New Hampshire at 1.89% as opposed to the lowest in Louisiana at 0.18%.
However, individual counties can charge more than these rates
Insurance Costs Can Vary Considerably
Since a recreational vehicle is not considered to be a dwelling for insurance purposes, people do not need homeowners or flood insurance.
However, since an RV is a vehicle, they do need to purchase automobile insurance.
The cost for depends on the attitudes of insurance companies.
- Most charge reasonable rates, but some can be outrageously high.
- Others place limits on how much they will cover.
One company wanted $1700 to insure my older, gas engine motor home and said they would not provide coverage at all for coaches that cost more than $200,000!
In the end, I insured my 1999 motor home with another company for $538.
Much depends on what you paid for your vehicle as well as your personal situation.
Clearly it will cost a great deal more to insure a $350,000 vehicle than one for which you only paid $50,000, and a bad driving record or poor financial history will up the fees.
In recent years, due to all of the natural disasters we have had in the US, car insurance has gone up considerably. However, even with that, if you have a clean record and own a coach that cost you less than $40,000, you should be able to pay less than $2,000 per year to insure both your automobile and your RV.
Insurance Costs for a Fulltime RV Owner
RV utility costs can vary depending on the behaviors and attitudes that affect what people pay for electric, sewer, and water.
The differences can be quite striking, because depending on circumstances, costs can range from about $50 per month up to $300 or more.
What Will I Have to Pay for RV Utilities? gives more detailed information about this issue.
Computing Costs on a Per Person Basis Is Tricky
It is difficult to discuss the financial aspects of coach ownership for any one individual situation because there are endless combinations of issues involved in it.
For example, factors that all affect what people spend to pay fto buy recreational vehicles include such items as:
- whether a coach was financed or not,
- the terms of the purchase agreement,
- the initial sales price,
- whether the RV was purchased new or used,
- the overall condition, and
- its place of origin.
Things that effect living costs can include:
- the type of unit you purchase,
- where you store it,
- how you set up your living/or travel arrangements,
- how well you take care of your unit,
- how well you plan your trips,
- what types of vacations you take and
- how you use your utilities.
Here is just one example of how much costs can vary:
A few years ago my husband and I took a summer long RV trip to the West Coast.
Friends of ours did the same.
However, because they planned their route poorly, their trip cost twice as much as ours, even though ours lasted much longer than theirs.
Selling Can Cost A Great Deal
When buying an RV, you need to consider how much it will cost you to sell it when you no longer want or need it.
Most people do not realize that the biggest financial loss they take is what they get for their unit at the point of sale due to the issues of depreciation, aging and wear.
Generally, new units depreciate at a rate of 20% the first year and 5% for each following year.
Here is a chart that will give you an idea of potential losses.
Obviously, if you spend less when you buy, you will lose less when you sell.
Learn the Financial Facts
Learning about the actual cost of owning a coach is a big step in the right direction towards giving you the best possible financial experience.
If you pay attention to what you are doing and use some good old fashioned common sense, you will do just fine!
Do you think you could afford to own an RV?
© 2012 TIMETRAVELER2