VIDEO: New or Used?

Posted In: Airstream, Blog, Campfire Question, Choosing an RV

One of the purposes of our “Campfire Questions” is to consider a variety of issues that RV owners face.  But it goes beyond RV owners, because many people who check out are researching RV purchases. They may be debating whether to pull the trigger on an Airstream purchase, or another type of RV.

Bear in mind that even IF you currently own an RV, there’s a good chance you’ll find yourself RV shopping again. A lot of people change RVs, moving up or down in size, or switching between travel trailers and fifth wheels and motor homes. So even if you already have an RV, it’s always wise to consider the shopping process, and making your next RV deal a good one…

There’s a lot to ponder when purchasing an RV. Although there are similarities with buying a car, it’s not the same. I mean, most of us grow up with some basic knowledge of cars; we all know the difference between a sedan and a SUV, right? But many of us have no clue when it comes to RVs. . Quick, can you tell me the differences between a Class B and a Class C motorhome? Maybe you can now, but you probably couldn’t when you first started looking for an RV.

One of the fundamental issues RV purchasers all confront, sooner or later, is whether to buy a NEW or USED RV. There are valid arguments to be made on both sides. This is ultimately a personal choice. Some might see it as strictly financial, but there’s more involved than just moula. I’ll outline a few pluses and minuses here. (Note that the issue is complicated if you are interested in Airstream travel trailers, since the desirable vintage units are all, by definition, used.)

Advantages to buying a NEW RV:

1. You can choose your preferred model & floor plan
If you’re buying new, you might as well get EXACTLY what you want. Getting an appropriate floor plan for your needs is crucial. Getting a “perfect” floor plan is priceless!

2. You get the latest RV technology.
Okay, at first glance “RV technology” seems a bit of an oxymoron. I mean, the technology of water tanks and propane lines is pretty mature and doesn’t change much from year to year. That said, there may be a few bells & whistles (flat screen TVs, media packages, etc.) on new models. Newer RVs are typically more spacious. (For example, Airstream switched all models to “widebody” dimensions in 1996.) And a few manufacturers push the envelope with regard to innovation. Sure, you may not need that mechanical screen porch that extends at the press of a button, but isn’t it cool?

3. You get a manufacturer’s warranty.
An RV is basically an apartment on wheels. Use it enough, and something will go wrong. Heck, even if you don’t use it, something will go wrong. With a warranty at least the manufacturer will pick up the repair tab.

4. It’s new!
Let’s face it. New is nice, whether it’s a car, tow vehicle, or a RV. When you buy used, there’s always a slight linger of doubt with regard to the unit’s history. Sure, it may appear to have been well maintained — but do you really know? And everyone loves that new car smell.

But what about the USED market? Unlike cars, RVs are not driven daily. Most are not used daily. Heck, many are barely used at all! When shopping for a used RV, it’s possible to find some incredible deals.

TRUE STORY: A friend of mine bought a NEW travel trailer, kept it in storage for a few months, and then resold it for a loss — having NEVER even SLEPT in it! The story is a bit unusual but hardly the only one of its kind. I once met a fellow who bought four year old Airstream Classic that was so new, it still had plastic wrap on the couch. The pre-owned market is replete with nice used RVs that have seen minimal actual usage. If you conduct a patient search, you can find what you want in “like new” condition — at a used price.

Advantages to buying a USED RV:

1. Lower up front cost.
RV values depreciate just like the values of cars, boats, and other such items. One recent depreciation chart states that the average new RV loses 35% off its full MSRP (manufacturer’s suggested retail price) in the first year of ownership. It loses 10% in the second year. So by year three, the RV is already worth 45% less than its original MSRP.

2. Less depreciation.
That depreciation chart I mentioned? It also shows that after the first few years, the depreciation curve levels out considerably. The RV depreciates 10% in year two, 6% in year three, and by year six it depreciates 5% or less annually. In other words, if you buy an RV that’s just a few years old, someone else has already taken the major depreciation hit. Not only do you enter the deal at a more attractive up front price, your rig will hold its value better than a brand new unit.

There’s an excellent financial book called The Millionaire Next Door. The authors studied the behavior and habits of American millionaires, and report their findings in the book. The book’s key message is that frugality and smart shopping lead to a high net worth. The majority of American millionaires NEVER buy new vehicles. They buy used vehicles that have depreciated a bit, so they can instead place their money in assets that will increase in value.

3. Customization
In the Airstream owners community, the hippest trailers are vintage units customized to their owners’ delight. All vintage Airstreams are “used.” Sure, new Airstreams are lovely and offer some amenities not present on the vintage rigs. But vintage units have a style and panache that is simply unmatched.

To a certain extent, the option of customization exists in all RVs, but it makes more sense in a used rig. I mean, if you are buying a new RV, why wouldn’t you just start with the interior you want? With a used rig, there will be fewer pangs of guilt should you decide to replace the flooring or upgrade the cabinetry and recover the couch. To a certain extent, an RV is like a home. You can decorate and renovate it to your desire. If you buy used, you can immediately start making those small changes that make a big difference to you.


New or Used? Some final thoughts…

As mentioned above, if you want to pick up a hip vintage Airstream, then by definition you will be buying a used unit. Many people buy old Airstreams and renovate the trailers from the shell up. The key is to find one with “good bones,” but that’s another topic of discussion.

Another factor is how long you plan to keep the RV. Are you the type of person who frequently buys and sells this sort of thing? Then buying a brand spankin’ new unit may not make sense, due to the steep initial depreciation. Repeatedly buying and selling new, expensive, rapidly depreciating assets is a recipe for financial disaster.

On the other hand, are you a “buy and hold” type? Do you know EXACTLY what you want? Then maybe it makes sense for you to buy a new RV. Sure, you’ll weather the effects of massive depreciation, but if you are keeping the unit for a long time then it arguably doesn’t matter as much. The cost is amortized over time.

Have you never owned an RV before in your life? If so, then maybe a used model would be the safest bet. (When testing water temperatures, gingerly dip your big toe instead of leaping headfirst into the deep end.)

Have you never RV’d before in your life? Please, try one out before making a purchase. Borrow a friend’s, spend the night in a KOA Airstream, or try one of Cruise America’s motorhome rental deals. It’s definitely wise to try before you buy.

Any thoughts on the NEW versus USED issue? Feel free to chime in…

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