A tale of two trailers, or prices are thru the roof.

[Brandon_the_Tra]

In 2018 I requested pricing for a Rockwood Travel Trailer from RVW and stumbled upon the email / quote they sent back yesterday.

Out of curiosity, I requested pricing last evening on the same exact model, with the same options, and received it earlier today.

2018 for a 2019 = $23,980.00
2021 for a 2022 = $41,700.00

How about an increase of %42 for what amounts to the same exact thing? That is unless you take into consideration that it has to be ordered, the build date will not be "confirmed", but the "estimate" is 12 to 16 weeks. Then add in their are claims that anything being built in Indiana right now, and for the foreseeable future, is exceptionally shitty. It's supposedly way worse in the build quality dept than prior to the pandemic, which seems hard to do. And that's coming from dealers.

[Dami_Heal]

Thank you for writing. I have been thinking about purchasing Rockwood Travel Trailer. But now I'm not sure if this will be a good decision. Definitely not for business.

[jffnkrn]

What do you mean when will an rv cost the same as a home?
We paid 70K for our home at the bottom in 2012, we bought our full size fifth wheel, fall of 2019, $55K. there are a multitude of rv's out there well over 100K. 🙂

[Timmo_]

Will this RV Bubble ever get as crazy as the Tulip Bulb Bubble (when prized bulbs were valued at the same price of a modest home) from the 1600's? Nah, but at this rate of demand and excesses, it might be by next summer, when EVERYONE must have an RV. Hmm, when will the value of RVs equal the same price of a modest brick & stick home?

Some of us were around when Nasdaq companies (worth 10 cents/share) were selling for $20-30. Me too-ism.

[ford_truck_guy]

My buddy was buying a Grand Design Solitude this year, while doing so, we were were in a few nice chats with the representative.

Grand Design had 4 price increases of about 4% - 6% each just in 2021 due to commodity issues.. He was able to find the exact unit he wanted in Nashville ( 16 hrs away ) that was built before 2 of the increases at the time...

SAME EXACT trailer ordered to same specs was $8,000.00 more because it was built after the increase.. Crazy times in the RV and TV markets.....,

[Brandon_the_Tra]

rmnpcolorado wrote:
yeah, we missed the boat on this last year, but our timing wasn't right and we needed a new TV up front. Timed the TV purchase great, but now our TT is a 2011 and it would be nice to replace it with something bigger for our family.

So June 2020 we visited our local dealer and looked at a Heartland NorthTrail 24BHS. I believe the dealer had it listed at $24,995 or so, but we didn't like how it was constructed and instead looked at the better built Riverside RV Intrepid next to it for the same price or less, but couldn't swing it at that time. Today I was on Camping World's website looking at their "Clearance Sale" and I see a 2021 24BHS, same as the 2020 we looked at, listed at $34,732. I scroll down just a few units more and see a 2022 for $41,912! Now come on, there's no way they've appreciated over $7K from model year to model year, let alone the same amount over the prior year.

Yes, I read all of the previous posts and I agree with you, just venting. It's just frustrating when you want to upgrade your 10 year old unit and really can't. I think I'll take it to the dealer next spring and drop a grand+ in maintenance and call it good enough for another few years hopefully.

Forest River raised prices across all their brands thus.
7-2-21 = 6%
7-30-21= 4%
8-14-21= 6%

42 days=16%
Just an example with rounded number
$35,000.00 + 16%(5600.00)= $40,600

I dont have the data for the period since 8-14-21 but am told in Sept/Oct the increases total @ 14%. If accurate the $40,600.00 is now $46,284.00

Its unsustainable.

They can keep their new overpriced slapped together garbage. There is no shortage of suckers to buy them right now.

[Skibane]

rmnpcolorado wrote:
It's just frustrating when you want to upgrade your 10 year old unit and really can't. I think I'll take it to the dealer next spring and drop a grand+ in maintenance and call it good enough for another few years hopefully.

That sounds like the smart move.

Right now, your odds of trading a tried-and-tested RV for a much more expensive and unproven model - without regretting it afterwards - are not good.

[rmnpcolorado]

yeah, we missed the boat on this last year, but our timing wasn't right and we needed a new TV up front. Timed the TV purchase great, but now our TT is a 2011 and it would be nice to replace it with something bigger for our family.

So June 2020 we visited our local dealer and looked at a Heartland NorthTrail 24BHS. I believe the dealer had it listed at $24,995 or so, but we didn't like how it was constructed and instead looked at the better built Riverside RV Intrepid next to it for the same price or less, but couldn't swing it at that time. Today I was on Camping World's website looking at their "Clearance Sale" and I see a 2021 24BHS, same as the 2020 we looked at, listed at $34,732. I scroll down just a few units more and see a 2022 for $41,912! Now come on, there's no way they've appreciated over $7K from model year to model year, let alone the same amount over the prior year.

Yes, I read all of the previous posts and I agree with you, just venting. It's just frustrating when you want to upgrade your 10 year old unit and really can't. I think I'll take it to the dealer next spring and drop a grand+ in maintenance and call it good enough for another few years hopefully.

[Brandon_the_Tra]

Better yet is what they want right now just to order a trailer from the manufacturer.

$5K deposit and no guarantees as to when you'll receive it. Could be 12 weeks, 24 weeks, or 50. They will agree to hold the price once the deposit is received against any manufacturer imposed price increases, but other than that its non refundable. (Found one who would, most won't) I offered up $1K for a deposit as was done on the last two I ordered, and that wouldn't fly, $5K or the highway.

If your rig arrives and is a falling apart hastily assembled Covid Construction POS, rolled out the door on a Friday at 3PM, by a workforce who started building trailers the day before, well thats just too bad. It's all yours. Or refuse to buy it and give up the deposit. I can't believe they find suckers to sign onto this BS, but they do.

[Brandon_the_Tra]

Timmo! wrote:

If one is a savvy investor, your overall portfolio performance should be up (in both up and down markets), but among the winners will be losers

Exactly, and if anyone considers an RV an "investment", they're an idiot.

[Timmo_]

wing_zealot wrote:
You’re missing the key part of his post
“as long as any investment I made instead of paying cash is at least keeping up with inflation I'm well ahead”.
You’re comparing interest to inflation, he’s comparing interest to ROI. I don’t know about him but the ROI on my investments have beat inflation (and my interest rate) several times over for quit awhile. We are however in new territory now.

Yes, if you overpay something today and it is worth more tomorrow, than you are dollars ahead. But, there usually is a day of reckoning, when prices return to "normal" (whatever that means, lol).

Remember that housing bubble we had years ago? Cheap money made overpriced homes affordable, but when home prices retreated back to "normal levels" (mortgage balance now exceeds value of home), what happened? It was cheaper for many homeowners to walk away and start over. Negative ROI?

If one is a savvy investor, your overall portfolio performance should be up (in both up and down markets), but among the winners will be losers; you have a paper loss if not sold--real loss if sold. Savers on the otherhand are being eaten alive when interest rates are well below inflation.

[Brandon_the_Tra]

Timmo! wrote:


Imo, we are witnessing in the RV industry an excellent example of "market aberration"; aka abnormal conditions.

That's a great assessment which I think is dead on.

The value sites, Nada, Bluebook, etc, recently adjusted RV values in a massive way. To the tune of 30% to as much as 50% higher. They've never done that as long as I've been following them. It's always went down a few percent every so often. At the same time quality went to hell in a hand basket. It's unsustainable but the RV Industry does not care, they're not your friend and could care less about repeat business. It has always been that way and always will.

So you ran out and bought an RV for $50K 3 months ago which you could of easily purchased for $30K 18 months ago. You received the same junk, just paid more for it. Even if you paid cash, when the values get adjusted back to a more realistic level, which they will, you are going to get a good financial screwing. If you financed that purchase long term, your going to get your screwing dry with some sand added in. With the quality I have seen over the last year and a half coming out of Indiana and elsewhere they will not be able to give these turds away two years from now.

[wing_zealot]

You’re missing the key part of his post
“as long as any investment I made instead of paying cash is at least keeping up with inflation I'm well ahead”.
You’re comparing interest to inflation, he’s comparing interest to ROI. I don’t know about him but the ROI on my investments have beat inflation (and my interest rate) several times over for quit awhile. We are however in new territory now.

[Timmo_]

afidel wrote:

Timmo! wrote:

Brandon the Traveler wrote:

Timmo! wrote:
L but entry level for consumers buying a new TT is really out of reach for many "common folks".

They just finance them for 12 years or longer. A TT that was @ $20K 18 months ago is now @$35K or more, and banks are lending towards them. Let the inflation continue including the ever rising cost of fuel and watch this house of cards come crashing down. When these inflated prices, actually values drop, it will be ugly.

IMO, when the amount financed exceeds FMV at the very beginning, then the entire deal will always be "underwater".

When a person makes a deal based on "how much is my monthly payment", and not on "how much does it cost", then it is proof positive that we have a generation of people that are absolutely "financially illiterate". (shakes head)

How many know that charging their credit card $5 for a Starbucks cup of Joe and then paying for it over 10 years at 25% interest...the real cost is $13.65. But it's only costing you 11 cents a month.

Financial illiteracy at it's finest.

My RV loan I took out last year is at 3.5%, inflation is currently 5.4% so as long as any investment I made instead of paying cash is at least keeping up with inflation I'm well ahead, and they are. But I did a normal 60 month loan knowing that I'll be trading up to a 5er about a year or two after that so I didn't want to have anything left on this one (going part time on the road after I get the younger one through college).

Yes, this years' inflation is abnormally high at 5-6%, but, imo, there are some fallacies in your line of thinking.

For the period 2011-2021, the annual inflation rate averaged 2.2% (try using this number in your analysis). In normal times, the rate of inflation will usually be close to, or below the prime interest rate (3.25% today).

Certain assets traditionally increase in value over time (real estate, stocks, precious metals, etc) and certain assets don't (vehicles, RV's computers, etc).

To value an asset purchased 10 years ago in terms of today's dollars, one starts with purchase price (say $10,000) and adjust it for inflation (10 years at 2.2%--lets keep it simple and call it 22% or $2,200). Ergo, an asset purchased 10 years ago for $10,000 is valued at $12,200 in today's dollars (inflation).

But this math does not work for assets that depreciate (RVs)--as the values are determined by the marketplace, called Fair Market Value (what a willing buyer will pay and what a willing seller will sell, neither under any duress).

Imo, we are witnessing in the RV industry an excellent example of "market aberration"; aka abnormal conditions.

I stand by my claim: If the amount financed exceeds the asset's FMV, the entire deal will always be underwater (loan < FMV). Said differently, if an RV is worth $20k but I pay $30k for it, and is financed 100%, when will this deal ever be above water (amount due on loan be less than FMV)? But I hear the howls, "what if I pay the loan off and sell it for $1"

Well,we have this thing called carrying costs, (aka interest). Difference between all cash purchase and 100% financed. Add all those interest payments to the purchase price and you have your actual cost.

[afidel]

Timmo! wrote:

Brandon the Traveler wrote:

Timmo! wrote:
L but entry level for consumers buying a new TT is really out of reach for many "common folks".

They just finance them for 12 years or longer. A TT that was @ $20K 18 months ago is now @$35K or more, and banks are lending towards them. Let the inflation continue including the ever rising cost of fuel and watch this house of cards come crashing down. When these inflated prices, actually values drop, it will be ugly.

IMO, when the amount financed exceeds FMV at the very beginning, then the entire deal will always be "underwater".

When a person makes a deal based on "how much is my monthly payment", and not on "how much does it cost", then it is proof positive that we have a generation of people that are absolutely "financially illiterate". (shakes head)

How many know that charging their credit card $5 for a Starbucks cup of Joe and then paying for it over 10 years at 25% interest...the real cost is $13.65. But it's only costing you 11 cents a month.

Financial illiteracy at it's finest.

My RV loan I took out last year is at 3.5%, inflation is currently 5.4% so as long as any investment I made instead of paying cash is at least keeping up with inflation I'm well ahead, and they are. But I did a normal 60 month loan knowing that I'll be trading up to a 5er about a year or two after that so I didn't want to have anything left on this one (going part time on the road after I get the younger one through college).

[Timmo_]

Brandon the Traveler wrote:

Timmo! wrote:
L but entry level for consumers buying a new TT is really out of reach for many "common folks".

They just finance them for 12 years or longer. A TT that was @ $20K 18 months ago is now @$35K or more, and banks are lending towards them. Let the inflation continue including the ever rising cost of fuel and watch this house of cards come crashing down. When these inflated prices, actually values drop, it will be ugly.

IMO, when the amount financed exceeds FMV at the very beginning, then the entire deal will always be "underwater".

When a person makes a deal based on "how much is my monthly payment", and not on "how much does it cost", then it is proof positive that we have a generation of people that are absolutely "financially illiterate". (shakes head)

How many know that charging their credit card $5 for a Starbucks cup of Joe and then paying for it over 10 years at 25% interest...the real cost is $13.65. But it's only costing you 11 cents a month.

Financial illiteracy at it's finest.