Class C Depreciation

My wife and I are considering a Class C and have been told that most people trade theirs in every 4-5 years due to depreciation and getting rid of it so they are not as upside down as they would be after year 5. We like the idea of a Class C but we do not want to have to bring several thousand dollars to the table if it is true that you are better trading up around year 5. I'm assuming this theory is based on buying a new unit.

That doesn't make any sense, IMHO. As Toes indicated, you're far more likely to end up upside down buying new every 4-5 years, taking a depreciation hit on each new deal. If you make a substantial down payment, and finance for a relatively short term, you will have some equity in your RV, possibly for the life of your loan even, depending on the down payment. No matter what you do, RVs are depreciating assets.

You want to try to buy something worth holding on to. Sure, if your situation changes, your choice of RV may change, too. But starting off thinking you should buy a new (or even used) unit every 5 years is a rather expensive way to RV, and I don't think "most people" do it that way, and even some who do didn't initially intend to do it that way.

I also disagree. I think you either misunderstood or it was a salesman trying to hoodwink you.

The biggest depreciation hit is when you drive it off the lot. If you buy new and sell every 4-5 years, you're going to get that big hit each time. That is NOT a smart financial decision.

If you buy new, you're better off keeping it as long as possible - the longer you keep it, the more likely what you owe on it will be less than what you can sell it for.

There are three main reasons people trade in an RV after 5 years or less:

1. They bought the wrong RV in the first place (didn't like towing, not enough space for everyone, and so on);
and
2. Their life situation changed and what worked before doesn't work now (got married and had kids, divorced, etc.);
and
3. They are afraid of not having a warranty and having to do maintenance work themselves.

I would disagree, with, pretty much the entire statement. First, your best buy is about a 3 to 4 year class C. Buying new and trading it in every 4 to 5 years is, in my opinion completely nuts. Thing will lose close to half its value in 5 years. (that's like a 30kplus loss every 5 years) Unless you pay cash you will still be way underwater in 5 years.

Buy the right one, a few years old, get what you want and drive it till the wheels fall off. Bought ours 11 years ago. It was 4 years old at the time have put 60K on it and is still going strong. Have no plans to replace anytime soon