Which is cheaper - new or 3-year old over 8 years?

For those who really want to perspective on depreciation, A 10 yr old Foretravel has experienced more depreciation than what I would spend buying 3 of the RV's I have brand new - if not more. They "lost" more money than I would spend buying 3 new rv's. It's all relative to the unit you buy. But again, is the Foretravel's depreciation really a loss? Only if you sell it. Otherwise what you paid, amortized or not is included in cost of ownership. Depreciation is a ficticious number which only becomes real when you sell or trade. Otherwise it does not come out of your wallet monthly, it does not affect your income or profit. There is 0 impact financially. It's meaningless. Gas, maintenance, repairs, a loan, etc are real numbers and actual components of the cost of ownsership. Depreciation has no financial bearing in cost of ownership at all. Unless you sell. Don't plan on selling? don't count it.

LOG wrote:
WOW!! I think I finally got it. Depreciation does not matter if you never sell the motorhome. And, maintenance cost does not matter if you never drive it. So, if you buy a new motorhome and pay cash for the purchase, it never cost anything because you just traded dollars in the bank for an asset in your driveway. I got it. You just buy it with cash, park it, never sell it and the cost of ownership is zero.

Making an assumption this is a bad attempt at sarcasm. Cost of ownership includes the price you paid. If you got a loan it's amortized. And who said maintenance doesn't exist if you don't drive it? But correct, unless you have reason to claim depreciation, or planning on selling in which case it's a loss, it's a moot point. RV's are assets, the loan is the liability. But unless you plan on doing some sort of accounting on it or sell it then what difference does depreciation matter? You can't leverage it, Just about everything you buy depreciates with few exceptions. Do you take consideration to cars, electronics, or anything else? No. WHy? because you don't leverage or plan on selling them. Now, if you planed on trading or selling in a few years, then it matters. It may matter to some who want the perception they didn't "lose" as much as another guy because their deprecation was less. But it's intangable until you sell. Every one of us on this forum that has an RV took a loss when we turned the key. Some less than others. It's laughable to try and factor it in.

LOG wrote:
WOW!! I think I finally got it. Depreciation does not matter if you never sell the motorhome. And, maintenance cost does not matter if you never drive it. So, if you buy a new motorhome and pay cash for the purchase, it never cost anything because you just traded dollars in the bank for an asset in your driveway. I got it. You just buy it with cash, park it, never sell it and the cost of ownership is zero.

Wow. New math?

There are lots of different people in this world with lots of different reasons for doing things. We're all right, in our own way.

We bought used. 3 years old. We were looking at 3 new motorhomes. 2 cost the same as the 3 year old. 1 cost considerably more, but when looked at close, just didn't even compare.

We moved to a much more high end manufacturer for the same dollars.
It's paid off in our case.

Another thing that hasn't been touched on is the DIYer vs Checkwriter.
In an extreme example, a loose cabinet door may mean a 500 mile drive to the dealer (under warrantee, new coach) for the checkwriter, where a rod knock may be seen as an opportunity by some DIYers!

WOW!! I think I finally got it. Depreciation does not matter if you never sell the motorhome. And, maintenance cost does not matter if you never drive it. So, if you buy a new motorhome and pay cash for the purchase, it never cost anything because you just traded dollars in the bank for an asset in your driveway. I got it. You just buy it with cash, park it, never sell it and the cost of ownership is zero.

Everyone keeps talking about depreciation like it matters. If you buy a coach to sell it you are a fool. Depreciation is only relevant when you sell. And whether you buy new or used you will lose money trying to sell it. If you are buying it to use it then throw the depreciation number out the window. I just doesn't matter. You want to compare cost of ownership and usage on new vs used. Some claim maintenance is more expensive on new and I would ask why or how you calculate that? With so many variables in a used coach (make model, engine components and the biggie - wear and tear) how can you make a blanket forecast? Gas units are cheaper to maintain than diesel. Older units will have a sooner need for fixing and replacing parts. Why is everyone making this so complicated? The short answer is you can get more bang for your buck up front on the purchase of a used vs new. Outside of that who knows what it will cost any used unit in repairs. Logically a used unit wil need stuff sooner. That's not rocket science. But it really depends on the unit and how it was cared for. I would say apples to apples (similar coaches new vs used) regular maintenance is the same. Buy what you want. I think basing a decision on new vs used is a bad place to start. STart with a floorplan and model that fits your plans on usage and your budget. THen back into whether you find a used gem or a new one with the specs you want. In the end it won't matter much if it's new or used as long as you like it and it's reliable.

Deprecation costs of a new MH will always be more that repair and maintenance for an older MH on average. I say this because if you look at the deprecation curve for a MH you can see the knee of the curve is at 3-4 years(the greatest % of deprecation)after about 8 years or so it will drop to 6% for ever until it reaches scrap value. Your question is will the cost of repairs exceed the deprecation cost on a older MH. I think statistically the answer is no. In my case I bought an older MH and several of my friends bought brand new. I had what I thought was a lot of problems and spent what I thought was a lot of money fixing it and emotionally thought I should have bought a newer MH. But when I looked at the actual data, I spent $12,000 over 8 years of ownership in total for repairs and maintenance roughly half for repair half to maintain the MH. So I lost $6000 in repairs and $15,000 in deprecation in 8 years while my friends lost $30,000 in one year for deprecation just driving the MH of the lot. Older MH's can blow engines or transmissions as well as newer MH's but if you look at this statistically the cost of repairs will never come close to the deprecation loss of a newer MH.

I think that if you took the same 180 - 200K and looked for a 3 year old used 36" motorhome, you would be able to purchase a great coach that has been through its initial trial period. The kinks will have been worked out. Require the maintenance records be furnished. For that money you should be able to purchase a quality coach.

Acei wrote:


Financing is not an issue since we are looking to go full-timing and we are going to be selling our house. If we can't get a good interest rate on a loan, we will just pay cash and invest the rest.

Looks like a new unit will cost around $180k-$200k after discounts, while a 3-year old slightly used units will cost around $120-$140k for similar units. The difference appears to be around $60k and I'm sure some of that will go away since more repairs will be needed on a 3-year old unit over the following 8-years and both units will be worth something when we are done full-timing so the difference will be even smaller. I'm trying to figure out how much savings are we talking about by going used. Looks like it amounts to $200-300/month difference over the ownership period of the MH which is less than what I was expecting.

Am I overlooking at something here?

After 3 years the initial build bugs will be worked out. The next 5-7 years are the sweet spot in reliability. Other than routine, you should incur few non-scheduled maintenance during those years, depending on use.

That said, the post above is important. Many people insist on confusing cost with value. Since you are going to full time, your enjoyment and peace of mind are far more important than cost.

Consider the cost of operation for each coach. Over 8 years, your will replace the tires and batteries at least once, on either coach. I have had my present coach for 6 years now and have about 50k miles on it. I have had to replace the washing machine, more from lack of use than wear, one roof air unit, and the house and chassis batteries. The cost of routine maintainence will be the same on either unit. Realistically, a three year old coach that has been well maintained should not cost more over an 8 year period than a new one. The real bonus is that you can buy a lot more coach for the same price if you buy used. The one we have was bought lightly used (6 months old, about 4k non-delivery miles) and we saved over $75,000 on it. You can pay for a lot of repairs for that amount of money.

Here is an example of a NEW 2011 RV and the amount of discount:2011 Thor
There are others and there may be even older "new" coaches out there that are deeply discounted.