Extra Income Source (by Richard [MI]) Jul 14, 2021 9:57 PM|
Extra Income Source (by plenty [MO]) Jul 14, 2021 10:02 PM
Extra Income Source (by Richard [MI]) Jul 14, 2021 10:04 PM
Extra Income Source (by Ken [NY]) Jul 14, 2021 10:21 PM
Extra Income Source (by Richard [MI]) Jul 14, 2021 11:49 PM
Extra Income Source (by P.B. [MI]) Jul 15, 2021 1:52 AM
Extra Income Source (by plenty [MO]) Jul 15, 2021 7:02 AM
Extra Income Source (by P.B. [MI]) Jul 15, 2021 8:00 AM
Extra Income Source (by Pat [VA]) Jul 15, 2021 8:21 AM
Extra Income Source (by S i d [MO]) Jul 15, 2021 8:52 AM
Extra Income Source (by 6x6 [TN]) Jul 15, 2021 10:55 AM
Extra Income Source (by Chris [VA]) Jul 15, 2021 12:08 PM
Extra Income Source (by Ltd [AZ]) Jul 15, 2021 4:09 PM
Extra Income Source (by Richard [MI]) Jul 15, 2021 4:23 PM
Extra Income Source (by Richard [MI]) Jul 15, 2021 4:34 PM
Extra Income Source (by 6x6 [TN]) Jul 15, 2021 5:08 PM
Extra Income Source (by P.B. [MI]) Jul 15, 2021 8:20 PM
Extra Income Source (by Ray-N-Pa [PA]) Jul 17, 2021 5:15 PM
Extra Income Source (by JIM [OH]) Jul 18, 2021 11:21 AM
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Extra Income Source (by Richard [MI]) Posted on: Jul 14, 2021 9:57 PM
I've noticed a few of the landlords here and also in my area changing some of their units to airbnb type rentals.
I've a;so noticed that all the campgrounds are full and I've read that RV sales are at record highs and expected to be strong for a while.
Some of the larger RV dealers and sales places are now LEASING RV's of most types to people who want to rent them for vacation use, just like airbnb.
I'm in the process of getting a couple RV's (used but in good shape) and letting these RV dealers lease them for me. They get their share of course and I can get mine. They store the RV at their place, service it, handle the rental, provide insurance, do the cleaning, etc. I get a check.
Now what gets me is that some RV's can rent for a pretty good amount, like $500 or so a WEEK! Of course, that $500 does not all go to me, but even if 50 percent does, that's close to the net of a $500 per month class C rental after operating expenses.
So I see a class C house (in my area) that returns $250 to $300 a month net and I look at a used RV that maybe costs $5-7K returning maybe $250 a week (of course, it's the yearly return that matters) during the "rental season". If the yearly net numbers are even close, renting RV's is starting to look good.
Some of the things that look good are: 1.faster depreciation 2. lower investment cost for the return 3. Less govt interference 4. No eviction problems 5. I can move it to a different location if the market changes (can't do that with a house).
Now if I can pick up 4 or more of these RV's for the price of one house, the returns on the amount of money invested COULD be better than dealing with class C tenants and unfriendly govt rules that change like the wind.
I'm just throwing this out there as a possible additional source of money.
Extra Income Source (by plenty [MO]) Posted on: Jul 14, 2021 10:02 PM
Fyi. RV's much like mobile homes don't take abuse or hard living. Wear and tear is different cause their life expectancy is shorter. And people tend to remove cabinets or make modifications to make space as they want to live. Which shortens the life. Just add that to your equation. --172.58.xx.xxx
Extra Income Source (by Richard [MI]) Posted on: Jul 14, 2021 10:04 PM
One other thing I see (I'm sure there are more).
Even though the renters pay for both the RV and for the house, the expected lifespan for the RV is MUCH LESS than the house, plus you do not get the land either.
So maybe the RV might have to be replaced every 5 years and a class C house could last 35-50 years or more. It would take some number crunching to make a good comparison. --24.180.xx.xx
Extra Income Source (by Ken [NY]) Posted on: Jul 14, 2021 10:21 PM
Very interesting,keep us updated.What happens when it breaks down on the road? --72.231.xxx.xxx
Extra Income Source (by Richard [MI]) Posted on: Jul 14, 2021 11:49 PM
Ken, When it breaks down there are insurance policies to cover repairs, like cars have. It's an expense (operating cost) that needs to be figured in, same as with cars. There are RV centers all over that do repairs. --24.180.xx.xx
Extra Income Source (by P.B. [MI]) Posted on: Jul 15, 2021 1:52 AM
I like your theory. We have a friend who rents out his RV during the summer, while he is home, then takes it to Arizona and vacations there during the winter. Last time we talked he received $85.00 per day. He pays the campground their fee of $30.00 per day, so realizes a profit of $50.00 per day. He rents for 3 days at a time. Tues. Wed. & Thursdays. Cleans Fri. between 11:00 a.m. & 3:00 p.m. and rents Fri. @ 4:00 to Mon. @ 11:00 a.m. cleans again. Starts over. He supplies clean sheets, towels, paper products, cooking pots & pans. Frig. is empty. No other bedding.
Campers are expected to dispose of all garbage and to leave the unit clean. He does not accept cash. Credit card, only as added fees are charged, if necessary. Campers sign a contract. He was totally booked for the summer.
We talked about being in the wrong business, ourselves, as we decided to drive through our over 150 site state park on a rainy day last week. Only 3 empty sites. --67.22.x.xx
Extra Income Source (by plenty [MO]) Posted on: Jul 15, 2021 7:02 AM
P.B. do the math 12 days a month x $50 is not enough for to pay for all the housekeeping expenses.
Extra Income Source (by P.B. [MI]) Posted on: Jul 15, 2021 8:00 AM
Sorry, you must have miss-understood, plus I answered in the middle of the night, as we had thunderstorms here last night, so my times may be off somewhat, etc.
What I meant is he rents a minimum of 3 days twice a week, so 6 days total. He will not take daily's as it is to much hassle.
Also, he and his wife do the work. --67.22.x.xx
Extra Income Source (by Pat [VA]) Posted on: Jul 15, 2021 8:21 AM
I would love to do Air B & B but my spouse says no. Too much hands on with cleaning in between (& providing breakfast). --71.219.xx.xxx
Extra Income Source (by S i d [MO]) Posted on: Jul 15, 2021 8:52 AM
Honestly, I think AirBnb/nightly rentals in general have shaken up the industry considerably.
Take a decent house in a decent area. It may rent for $1,500 a month. Or, you can put $10,000 worth of furniture and decorations in it and get $200 per night. At 50% occupancy, you get twice the income. The renter pays the cleaning fees. You get "pre-screening" via the website reviews.
The math isn't hard.
Also, vacation rentals would not suffer the same problem as regular month to month rentals regarding eviction moratoriums. The CDC never said you can't toss someone out of your nightly rental, because one of the requirements is the eviction would make them "homeless". Vacationers by definition have another home elsewhere and will want to return to their stuff.
The politics aren't hard either.
Nightly rentals are....intriguing to say the least! --108.230.xxx.xx
Extra Income Source (by 6x6 [TN]) Posted on: Jul 15, 2021 10:55 AM
Richard, Thank you for sharing your thoughts. What happens if the renters steel the RV? I guess the insurance would pay for it. Are there any taxes for renting RV's?
Don't you have to pay a hotel tax with AirB&B? Some states are really strict on them as well. I think here( not sure )you have to live on the property.
Extra Income Source (by Chris [VA]) Posted on: Jul 15, 2021 12:08 PM
I love the idea; I guess this would be taxed as a business with Schedule C. (I would love it even more if it would work with Schedule E, but that seems impossible.) --71.246.xxx.xxx
Extra Income Source (by Ltd [AZ]) Posted on: Jul 15, 2021 4:09 PM
Richard, are you talking about travel trailers or motor homes? Have you seen what a $5-7,000 RV looks like these days? I had a 24' trailer for a short time about ten years ago. I can't imagine anyone wanting to stay in one over a couple years old. Heck a 14' utility trailer is over $6,000 these days! My MIL has around $150,000 in her rig and my BIL is a RV salesman and got her a wholesale deal.
RV's are not built to real estate standards. Cabinets and fixtures are weak. The bathrooms are a mess unless you are talking a half million dollar rig. You have to replace the mattresses with a "real" mattress. RVs are considered to have about a 20 years lifespan. And they often leak like a sieve. The slide outs get stuck, and leak. The AC units are not designed for continuous use and generally will not cool sufficiently over about 85-90 degrees unless you have a 4 season insulation upgrade. They have 5-10 gal water heaters or expensive on demand systems. Working on motor homes is a pita.
Also - most of the roof AC's are powered by the generator or shore power, not the engine. So if you are driving in hot conditions (like most everywhere this summer) you have to run both the engine and the generator as the dash air won't cool the cabin. Most 3,500-7,500 watt gensets burn about 1/2 gallon of gas an hour, maybe a bit more. So you are looking at maybe $40-50 a day just to run your AC and appliances. And unless you go with diesel the generators are not designed for continuous use either.
Not to mention motor homes get like 8 miles a gallon, on a good day. Towing a trailer requires a substantial rig, often with suspension upgrades. You can't just rent a trailer to some dude with a pickup. My F150 gets about 12 mpg towing my jeep on the car trailer, vs around 20 mpg otherwise. I have the full towing "package," and the 2.7 dual turbo so my max tow is about 8,000 lbs, which is fine for what we do. But towing like a 32 ft trailer or 5th wheel you need the bigger engines and F-250's, which start about $75,000.
Anyway - not saying you don't have a good idea, but it seems to me like a business where you need to really learn your stuff first and/or work with someone who does.
I think if this covid disaster resolves that we will see a big dip in the travel insanity. I live in a resort town and we are already seeing a noticeable drop in traffic over last year. Our town was overrun last summer. The city had to fence off the riverfront parks and institute a $20 parking fee - which is now $100 for "preferred" parking. They spent all winter expanding parking. Last year the lots were overflowing, this year over the 4th about 20% of the lots were empty. I think when international travel and entertainment venues reopen fully that domestic travel will return to more normal levels.
I'm hearing this in Colorado too, not being as busy as last year. Though that's partly because folks are being priced out. Condos that used to be $200 a night are now $400 up. Anything affordable is booked a year ahead. And my experience is most of the Abnb and VRBO's we've stayed in are not up to my standards until you are in the thousand dollar a night range.
Have you considered yurts or tiny homes? ;)
I read they are getting $400 a night for yurts outside the Grand Canyon with night star views.
Extra Income Source (by Richard [MI]) Posted on: Jul 15, 2021 4:23 PM
If they are stolen, insurance pays.
As to the other stuff, I think the state will want their cut. The rental company should take care of that. --24.180.xx.xx
Extra Income Source (by Richard [MI]) Posted on: Jul 15, 2021 4:34 PM
LTD, Yes, I'm talking about travel trailers and maybe the smaller self driving rigs. Not the big class A units.
I think you're right about the things you mention so it will require a learning curve and some adjustments.
There are quite a few of the travel trailers in use around here. I was thinking, maybe, of putting some on a one acre place I have and rent them short term (weekend or by the week). Maybe also make a pad or two and let someone reserve the space (they would use their own trailer) either by the weekend, week or by the season.
I do like the idea of the yurts. I saw some info on that on YouTube.
Thanks for the info and ideas. --24.180.xx.xx
Extra Income Source (by 6x6 [TN]) Posted on: Jul 15, 2021 5:08 PM
Speaking of yurts, are those off grid?
You could do off grid rentals if you had a nice piece of secluded land. You could set it up like a state park and have trails and fire pits and other things. --73.120.xx.xxx
Extra Income Source (by P.B. [MI]) Posted on: Jul 15, 2021 8:20 PM
To clarify some things my friends do with their 5th wheel. He pulls his 5th wheel to the state park using his truck. Parks it on a site, where it stays. No one is allowed to move it, period. I think he has a hitch lock on it.
The park allows him to use the same site for a couple of weeks and then he moves it over to the next site. He reserves the sites ahead of time. People rent the 5th wheel, paying in advance. They swim, canoe, fish, have fires and enjoy the outdoor camping experience. They come, they leave.
He and his wife have been doing this for, I believe, 3 summers now, going on 4. In the fall they have a cut off date and stop renting it out. They give it a thorough cleaning, pack it up and head to Arizona, where they live in it for the winter.(Actually on vacation.)
In the spring they come home and start over with renting it out again. Is it a bit time consuming? Yes. Do they need to clean it? Yes. (They could hire it done but prefer doing the work themselves). Could they ask for more money per night? Yes, but don't as they prefer more bookings. They pay insurance on the 5th wheel, but most liability would fall onto the state park as it is the state's property. They earn at least $1,200.00 per month on a unit they paid $19,000.00 for 5 years ago. It was used, owned by one couple. Only needed to replace the toilet, once. The mattress, once, as they put a mattress protector on it. It is a Montana Mountaineer with 2 slides. No problems other than stated and no leaks. Renting has now paid for it. He thinks the condition is better than most as he doesn't have it on the road as much as most rented units would be. --67.22.x.xx
Extra Income Source (by Ray-N-Pa [PA]) Posted on: Jul 17, 2021 5:15 PM
Some people want active income where others want passive --72.23.xxx.xx
Extra Income Source (by JIM [OH]) Posted on: Jul 18, 2021 11:21 AM
LTD, I printed your response and am also saving it into the file. That is some real powerful information.
This site astounds me with the plethora of knowledge that gets shared. I have slurked for years and was a frequent contributor back when Aldo was a daily contributor.
Jeffery, keep it going. --184.57.xxx.xx
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