Counter question to selling your RV at 9 years....

[booster]

Originally Posted by Roadtrek Adventuous RS1

Okay...so, you think a Sprinter would depreciate "faster".... because it's a higher repair cost vehicle....? Mind you...I'm not necessarily disagreeing with your claim that it's a higher cost ... but, I think there's a hidden perceived value because it's a diesel... what do you think?

It might depreciate faster, but that wasn't what I said. What I said was when you do your comparison of costs to determine whether to sell what you have, or not, you would be comparing your anticipated repair costs on what you have against the cost of buying a newer van. If you have a van with higher repair costs, like a Sprinter does especially if you are hiring the repairs done, your cost benefit will tilt towards replacement of the van sooner than a with van that is cheaper to fix. If the cost to get in a newer van is, pick a number, $3K a year and the repairs anticipated on your van is $4K a year, you would tilt toward replacement. If the anticipated repairs on your van wer $2500 you would tilt toward keeping it. Sprinters are expensive to fix, so easier to justify the cost of replacement van.

[hepcat]

Originally Posted by booster

It might depreciate faster, but that wasn't what I said. What I said was when you do your comparison of costs to determine whether to sell what you have, or not, you would be comparing your anticipated repair costs on what you have against the cost of buying a newer van. If you have a van with higher repair costs, like a Sprinter does especially if you are hiring the repairs done, your cost benefit will tilt towards replacement of the van sooner than a with van that is cheaper to fix. If the cost to get in a newer van is, pick a number, $3K a year and the repairs anticipated on your van is $4K a year, you would tilt toward replacement. If the anticipated repairs on your van wer $2500 you would tilt toward keeping it. Sprinters are expensive to fix, so easier to justify the cost of replacement van.

As Avanti indicated earlier, depreciation can be calculated pretty easily by percentage from a chart, as most vehicles depreciate similarly. Some vehicles, of course, like Jeep depreciate at a much slower rate, some faster. Even so, if you want to know how much your specific coach will lose to depreciation over any given period, you can use the NADA values by year for your coach to figure that out pretty easily.

Ok, I'm not entirely sure I'm following your numbers here... "cost to get into a newer van is, pick a number..." what costs are you wrapping into this? Repair costs are understandable, and I have no idea what the actual repair costs for a Sprinter look like at 5, 10 and 15 years... but $4k/year seems a little high for maintenance to me.

I'm not seeing the $10k +/- per year you're eating in depreciation on a new van, or the depreciation you've already lost on your old one added into this discussion. Repair and other costs pale in comparison to depreciation on a new(er) coach.

You can discuss repairs, financing costs, and fuel expense all day long, but the REAL numbers you should be looking at are all of the factors involved in total cost of ownership including depreciation and insurance costs for the period you own the van. Depreciation remains THE single largest expense in owning a motorhome.

[avanti]

Originally Posted by booster

It might depreciate faster, but that wasn't what I said. What I said was when you do your comparison of costs to determine whether to sell what you have, or not, you would be comparing your anticipated repair costs on what you have against the cost of buying a newer van. If you have a van with higher repair costs, like a Sprinter does especially if you are hiring the repairs done, your cost benefit will tilt towards replacement of the van sooner than a with van that is cheaper to fix. If the cost to get in a newer van is, pick a number, $3K a year and the repairs anticipated on your van is $4K a year, you would tilt toward replacement. If the anticipated repairs on your van wer $2500 you would tilt toward keeping it. Sprinters are expensive to fix, so easier to justify the cost of replacement van.

Yes, this is obviously correct.

Here's one way to look at it: A great many people eagerly spend $4-5K or more for the crappy extended warranty that Mercedes pushes on new Sprinters, even though they have no value until the OEM warranty expires and even then do not cover cover such failure-prone items such as emissions systems, which are the main things to worry about with the otherwise fairly reliable Sprinters. If these folks are being rational (admittedly a dubious premise), then they must believe that they are likely to pay more than that in the post-warranty years of their ownership. If THAT is true, then it is rational to be willing to give up the same amount in depreciation savings by selling their vehicles earlier. (I use Sprinters here only as an example. I assume but do not know that the other OEMs sell equally crappy extended warranties).

[Roadtrek Adventuous RS1]

Originally Posted by avanti

Yes, this is obviously correct.

Here's one way to look at it: A great many people eagerly spend $4-5K or more for the crappy extended warranty that Mercedes pushes on new Sprinters, even though they have no value until the OEM warranty expires and even then do not cover cover such failure-prone items such as emissions systems, which are the main things to worry about with the otherwise fairly reliable Sprinters. If these folks are being rational (admittedly a dubious premise), then they must believe that they are likely to pay more than that in the post-warranty years of their ownership. If THAT is true, then it is rational to be willing to give up the same amount in depreciation savings by selling their vehicles earlier. (I use Sprinters here only as an example. I assume but do not know that the other OEMs sell equally crappy extended warranties).

I didn't purchase my Sprinter brand new and I skipped the extended warranty the dealership really pushed for ... think it was Phoenix America...or something...a lot of money.... with many excluded items....

[Roadtrek Adventuous RS1]

Originally Posted by hepcat

As Avanti indicated earlier, depreciation can be calculated pretty easily by percentage from a chart, as most vehicles depreciate similarly. Some vehicles, of course, like Jeep depreciate at a much slower rate, some faster. Even so, if you want to know how much your specific coach will lose to depreciation over any given period, you can use the NADA values by year for your coach to figure that out pretty easily.

Ok, I'm not entirely sure I'm following your numbers here... "cost to get into a newer van is, pick a number..." what costs are you wrapping into this? Repair costs are understandable, and I have no idea what the actual repair costs for a Sprinter look like at 5, 10 and 15 years... but $4k/year seems a little high for maintenance to me.

I'm not seeing the $10k +/- per year you're eating in depreciation on a new van, or the depreciation you've already lost on your old one added into this discussion. Repair and other costs pale in comparison to depreciation on a new(er) coach.

You can discuss repairs, financing costs, and fuel expense all day long, but the REAL numbers you should be looking at are all of the factors involved in total cost of ownership including depreciation and insurance costs for the period you own the van. Depreciation remains THE single largest expense in owning a motorhome.

I've known a lot of people who lump them together..... WRONG, WRONG, WRONG....

All vehicles need regular maintenance...oil changes, filters, brakes, tires, etc.

Then there's gray areas...are new shocks, anti-sway and track bar maintenance or repairs?
I would argue that it's maintenance as well.....

Transmission, engine, coach failures like the generator or plumbing, glow plugs on my diesel or emissions fails are repairs....

Overall, my Sprinter routinely costs about $300 for a light service.air filter, .oil changes plus filters, water filter... EVERY 10,000 miles

AND... every 20,000 miles it's around $825....for all that and transmission service ...

I have a brand new emissions system compliments of Mercedes Benz....

[hepcat]

Originally Posted by Roadtrek Adventuous RS1

I've known a lot of people who lump them together..... WRONG, WRONG, WRONG....

All vehicles need regular maintenance...oil changes, filters, brakes, tires, etc.

Then there's gray areas...are new shocks, anti-sway and track bar maintenance or repairs?
I would argue that it's maintenance as well.....

Transmission, engine, coach failures like the generator or plumbing, glow plugs on my diesel or emissions fails are repairs....

Overall, my Sprinter routinely costs about $300 for a light service.air filter, .oil changes plus filters, water filter... EVERY 10,000 miles

AND... every 20,000 miles it's around $825....for all that and transmission service ...

I have a brand new emissions system compliments of Mercedes Benz....

Forgive me but I'm still not quite understanding your perspective... the only way I know of to compare the actual cost of owning a vehicle to another is to include all of the cost factors (depreciation, service, maintenance, necessary add-on options, fuel costs, and insurance) and dividing that by the time period you expect to own it compared to the same figures on another vehicle over the same period. Comparing just maintenance expenses, for example is really misleading as the total cost of ownership (including depreciation and insurance) could be MUCH higher for a given vehicle even though the maintenance expenses may be less.

[GallenH]

Interesting conversation. I'm just curious. It appears that most Bs sell for over $100k new. Is that right? What do you anticipate that B will be worth in 9 years? The difference divided by 9 appears to me to be a big "operating" cost. Am I wrong in this? Do most of you advocate buying new or, say, 5 years old Bs?

For my RV, admittedly an old 1997, I have to figure operating costs to be maintenance, insurance and, in my case, storage since I can't store on my property (HOA!!!!!). Those would be the same regardless. Where I see the difference between new and mine would be in gas mileage. I only get 15-17mpg. I just did a service after my Glacier trip of transmission, lube, brakes and rear axle at $500 and that's in the PHX area at a not-so-cheap-but-reliable-for-years shop. I probably put a grand in/year average given my old RV. If you've followed my other posts, I could have put a new Dometic fridge in, but I can do that myself for under a grand.

I'm curious......not advocating.....not arguing. But I tend to drive my cars into the ground and not buy new ones every 3-5 years. My Rav4 is 10 years old and has 60k miles. I guess the bottom line is partially determined by your philosophy and not by numbers.

[Knit]

If buying a Class B RV was only an economic decision, none of us would own one. Buying a deeply depreciating asset is only worth it if it provides pleasure, satisfaction, comfort or something else that makes it worthwhile. Mine is worth it to me.

[Roadtrek Adventuous RS1]

Originally Posted by hepcat

Forgive me but I'm still not quite understanding your perspective... the only way I know of to compare the actual cost of owning a vehicle to another is to include all of the cost factors (depreciation, service, maintenance, necessary add-on options, fuel costs, and insurance) and dividing that by the time period you expect to own it compared to the same figures on another vehicle over the same period. Comparing just maintenance expenses, for example is really misleading as the total cost of ownership (including depreciation and insurance) could be MUCH higher for a given vehicle even though the maintenance expenses may be less.

I've only had the vehicle since May 2017.

Are you suggesting that I add up all the expenses and divide by the total miles I've driven

All vehicles require Insurance, fuel, registration, maintenance, repairs.....
Plus, I made a significant number of upgrades for the purpose of safely operating the vehicle... would you include all of this ..

What about the initial purchase price and sales tax...??

Due to the short ownership that number would be horribly skewed and extremely high...

Do you see what I mean???

That's not a normal years expense....

[Roadtrek Adventuous RS1]

Originally Posted by GallenH

Interesting conversation. I'm just curious. It appears that most Bs sell for over $100k new. Is that right? What do you anticipate that B will be worth in 9 years? The difference divided by 9 appears to me to be a big "operating" cost. Am I wrong in this? Do most of you advocate buying new or, say, 5 years old Bs?

For my RV, admittedly an old 1997, I have to figure operating costs to be maintenance, insurance and, in my case, storage since I can't store on my property (HOA!!!!!). Those would be the same regardless. Where I see the difference between new and mine would be in gas mileage. I only get 15-17mpg. I just did a service after my Glacier trip of transmission, lube, brakes and rear axle at $500 and that's in the PHX area at a not-so-cheap-but-reliable-for-years shop. I probably put a grand in/year average given my old RV. If you've followed my other posts, I could have put a new Dometic fridge in, but I can do that myself for under a grand.

I'm curious......not advocating.....not arguing. But I tend to drive my cars into the ground and not buy new ones every 3-5 years. My Rav4 is 10 years old and has 60k miles. I guess the bottom line is partially determined by your philosophy and not by numbers.

Gallen; I suppose that it all depends on what make and model you're talking about...

My RS Adventurous sold brand new for over $125,000....or so with all options... plus almost 9 percent sales tax.....any financing etc.....

I purchased it used in May 2017...for $79,000 plus 9.75 sales tax... registration, first 9 months of finance charges..... suffice it to say...my total costs just to acquire the vehicle was around $90,000..... I surrendered the debt....it would have been another $57,000 plus if I continued paying monthly....

Now, I wasn't finished...it needed a lot of stuff the first year..new tires, batteries, glow plugs, new sewer hose... upgrades to the sound system, navigation, new KONI FSD shocks anti-sway bar track, solar panel system and a few other things....All of this was very expensive... yes ... I have about $107,000 into my rig...it's all customized for me......

Now I only have to maintain it...no other extraordinary expenses.....

I agree with you.... I normally keep my vehicles for 15 or 20 years....the vehicle may even outlast me....

I'm 66... really don't know if I'll want to keep it until I'm 80... we'll see....

Sort of figured out that whatever I get back from selling it later is hopefully less than if I had rented the vehicle..??

Right now we're just enjoying it...I put 15,000 miles on the RS since May 2017.. that's about 1,000 miles per month...... most of the miles were on an 11,000 miles USA tour last fall in 2017....

So,. this whole thing is very new to me and just want to make sure I don't have it too long and have difficulties getting some good return when I sell...

Other people are right when they said... it's NOT any kind of good investment...it's a money loser.....

But, I didn't get it for that....got it for the RV experience....you can't buy back years ....

Hope that clarifies my perspective for you.....

[Roadtrek Adventuous RS1]

Originally Posted by GallenH

Interesting conversation. I'm just curious. It appears that most Bs sell for over $100k new. Is that right? What do you anticipate that B will be worth in 9 years? The difference divided by 9 appears to me to be a big "operating" cost. Am I wrong in this? Do most of you advocate buying new or, say, 5 years old Bs?

For my RV, admittedly an old 1997, I have to figure operating costs to be maintenance, insurance and, in my case, storage since I can't store on my property (HOA!!!!!). Those would be the same regardless. Where I see the difference between new and mine would be in gas mileage. I only get 15-17mpg. I just did a service after my Glacier trip of transmission, lube, brakes and rear axle at $500 and that's in the PHX area at a not-so-cheap-but-reliable-for-years shop. I probably put a grand in/year average given my old RV. If you've followed my other posts, I could have put a new Dometic fridge in, but I can do that myself for under a grand.

I'm curious......not advocating.....not arguing. But I tend to drive my cars into the ground and not buy new ones every 3-5 years. My Rav4 is 10 years old and has 60k miles. I guess the bottom line is partially determined by your philosophy and not by numbers.

Purchased the rig from this dealership... I think it was a fair deal.....
And we get 18 to 20 MPG on the road depending upon conditions....more on straight flat level driving.........

Below is exactly the vehicle I purchased...see link......it's a pretty nice vehicle...

Here's some pictures ..plus the file from the original sale..

https://www.conejowholesaleauto.com/...beffb59e9eb708

[Bud]

Many years ago I used to run a 'Cash Flow Analysis' for customers when my solution was less dollars or to point how little more $'s my solution was. It was a capital investment of about 10-15 years. It Included the time value of money, had to as that is an expense. The analysis was by year with all expenses included, and Included the cost of money.

An example, mine for example:

I can buy new or keep an 05/04 Roadtrek 190P. I'll make up that after trade-in it will cost me $70,000 cash plus sales tax or about $76,000. At the end of the first year I'll have on the new B side over $80,000 Including the cost of money. The second year will also include a big dollar amount for the cost of money, then more but less the third year.................. It won't be long and the cost difference will be over $100,000 less whatever I'll spend on the Roadtrek 190 that I would not have spent on the new B. Oh then there is the difference in the cost of insurance.......

Point is, I'll have a lot of money to spend on the Roadtrek190. Or I could use present tense, I have a lots of money to spend on the Roadtrek.

I have spent some time contemplating whether to buy a new B. I even drove to look at some new ones. My problem is that the Roadtrek fits my application fine. But if I had no B, I would buy a new one.

In the early 80's sometime my wife and I were considering buy a hot tub. On a ski trip our reservations got screw-ed up and we had to spend a few days in a motel rather than a condo. We rented a private hot tub some place, maybe in today's dollars $75-$100. I thought that was expensive. I decided to do a cash flow by year with the hot tub, so I would know the cost per hot tub use. It only took a few seconds before I threw the piece of paper in the trash. I was not going to get my hot tub that way. We purchased the hot tub.

[Doneworking]

Bud, good post.

Apparently like you, my background is finance (and industrial engineering). Also like you, my existing B (2007 Roadtrek 210P) -as we might say in the part of the country we both live in - fits my pistol. Cost of new and fv and pv analysis are instructive tools, but generally folks just buy what they want anyway.

When and if our 210 doesn't "fit our pistol" anymore we will probably buy something new to enjoy. Completely disregarding costs and values, we simply love our Roadtrek and have no intention of worrying about depreciation, what is the newest and slickest, etc.

F. Scott Fitzgerald wrote once that to be rich was to "know how to possess and enjoy". It wasn't about quantity, it was amount quality of life.

Maybe that is why the most comfortable pair of shoes in the closet are also the oldest. And, yes, this attitude also often comes with getting a wee bit long in the tooth - and that description also fits me.

Paul

[booster]

All good posts, especially pointing out that all the financial calculations normally get thrown out the window anyway when done and the person does what he like, regardless of the money result. I think even the most careful spenders among us do that.



As with the the others who did this kind of thing at work, it was also part of my job. In my case it was to justify new machinery, upgrades, preventative maintenance, etc in factories. I was always amazed at how many times a project would get shot down by the owner of the privately held company as not cost justified (even if it was justified), but then the owner would go out and buy a much more expensive plane or car that depreciated and cost hugely more to maintain and store than the upgrade would cost.


It was all the owners money, so their choice, but it sure didn't make financial or business sense to me.

[Bud]

Doneworking, booster, your points have been about human emotion, feelings.

It is Ultimately about 'Is the emotion/feelings I'll get, worth the money And/Or the Risk'.

I've been involved in activities that are considered risk taking. I've know more than 2 or 3 folks that are dead from the same activity. I've walked off at times not getting my 'fix' as the risk was too high. Risk Management is about risk taking, with the reward Always being emotion/feelings. If someone is considering robbing a bank, the reward is about the emotion/feelings that the money will bring. And the reward is usually about 'perceived emotion/feelings', robbing a Bank or Buying a new B.

booster, you write: "I was always amazed at how many times a project would get shot down by the owner of the privately held company as not cost justified (even if it was justified), but then the owner would go out and buy a much more expensive plane or car that depreciated and cost hugely more to maintain and store than the upgrade would cost."

I'm thinking that maybe someone could write about the same concerning you and your B. But, you did I'll bet get more than your monies worth! Plenty of good emotion/feelings, a good time or you would have spent the money elsewhere. Hey, I've had a very good time reading about it. Thank you.

Bud

[Doneworking]

Bud is right on target. I have spent a lot of time and sweat and tears over the years doing risk/reward management analysis.

Now, in retirement, I focus on just enjoying the journey before me. The risk was being an entrepreneur for over forty years. The reward was enjoying the effort and work journey and now just enjoying the fruits of my labor.

In a couple of hours, I am going out to my garage, back out the Roadtrek and run up the road about fifty miles so my wife and I can enjoy a great little hambooger joint in a small town. Hand cut fries are hard to find and hard to beat. It is a hot day in Oklahoma so I will fire up the genset and leave the AC on in the RT while we enjoy the booger. May even have a nice malt to go with it.

That is part of the payoff for those forty years!!!! The greatest wealth is the availability of time to enjoy.

Paul

[goreds2]

Originally Posted by Rockwood27

RV financing becomes difficult to get on an over 10 year old vehicle. This limits your potential buyer market.

Plenty of people out there that can pay cash.

[avanti]

Originally Posted by goreds2

Plenty of people out there that can pay cash.

...including all the smart ones.

[avanti]

One aspect of the "when to sell" question that hasn't been mentioned is that of opportunity costs. Although it is absolutely true that you can nearly ALWAYS save money by repairing and keeping your current vehicle as opposed to buying a new one, that is an apples-and-orages comparison. Somebody mentioned "that new car smell". For many years, that was about all you got with a new car--changes across model years were mostly cosmetic. But, that isn't at all the case today. Over the last few years, vehicle technology has advanced at an astounding pace. Being a member of the "keep it for a long time" tribe, I didn't realize this until we bought the new Volvo which I have mentioned a few times. The difference is astounding, in comfort, in ease of driving, and most importantly in safety.

The luddites on this list can (and I'm sure will) say what they please, but the importance of many of these technologies is hard to overstate. It doesn't really sink in how valuable a lot of this stuff is until you've owned a vehicle so-equipped for a while. Warnings that at first seem like annoying "nanny" stuff become less frequent and you realize that the car is training you to be a better driver. The first time the car tightens the seat belts, brakes, and steers away from a vehicle or pedestrian you never saw coming -- then it really starts to sink in.

The "opportunity cost" point is that whenever you choose to hold on to an older vehicle, you are choosing to forego whatever innovation has taken place since your current vehicle was built. That cost could well prove to be great indeed -- all the more so for aging drivers. I fully expect that this tech will permit me to remain a responsible driver for many extra years, and it is quite possible that it could save my and my family's lives.

[booster]

Originally Posted by Bud

Doneworking, booster, your points have been about human emotion, feelings.

booster, you write: "I was always amazed at how many times a project would get shot down by the owner of the privately held company as not cost justified (even if it was justified), but then the owner would go out and buy a much more expensive plane or car that depreciated and cost hugely more to maintain and store than the upgrade would cost."

I'm thinking that maybe someone could write about the same concerning you and your B. But, you did I'll bet get more than your monies worth! Plenty of good emotion/feelings, a good time or you would have spent the money elsewhere. Hey, I've had a very good time reading about it. Thank you.

Bud

Totally agree on the fact that many or most folks are using emotion rather than logic or cost analysis, as that was main part of my point in explaining why a lot of things that people do don't make financial sense. I think the adrenaline junky thing you mention certainly is similar


Lots of folks would say, correctly, that a lot of what we do to the van is not economically justifiable, and I am probably the first in line to say that. The van and all the changes are certainly here because we want to travel, but at least for me there is also a very large piece of technical hobby involved that feeds my need to design, build, and (hopefully) improve things. I don't hesitate to do testing that costs money and time, just to get the information of how it works, or doesn't work. The Bill Erb spring test, and the lithium hybrid battery tests, for instance. I don't ski, or boat, climb mountains, etc so the van is part of my prime hobby. The good is that we wind up with a very functional and tailored to our needs van, albeit one that has much more cost and work in it that we could ever get out.