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Where are the Deals? New RVs or Used Rvs?
Are the best-for-the-money purchases used RVs or new RVs? Due to all sorts of local, regional, national, and worldwide issues on consumers’ minds right now, the market for new RVs has shifted its focus significantly from just a couple of years ago. Now, everybody knows exactly what they want in their campers, but they need a great deal. New RVs and used RVs from recent years are so similar that the used RV market has heated up significantly.
Usually, Used RV Prices Beat New RV prices, but…
In “normal” times, it’s a pretty safe bet that you can find a deal if you can snag a recent model of anything on the used market. Typically, you’ll get a better deal on used RVs as there’s lots of use left in them and the original purchaser took the initial depreciation hit that you see in lots of industries like RVs and automobiles. But these are strange times, and new RVs may be where the best buys can be found.
At the moment, RV dealerships have new RVs on their lots from as far back as 2022. That’s crazy in normal times. RV dealerships are reporting people are snapping up used RVs because we are psychologically trained to think we are making the prudent choice by buying something pre-owned. But the mind can misinform us when the environment is a bit different. When you can find up to three-year-old trailers, new RVs, that have never been owned at dealerships, you can bet the dealers are desperate to move them.
Having Old New RVs in Inventory is Painful
RV dealerships most often use “flooring” with banks to make sure they have enough new inventory on their lots to show potential buyers. The banks make money available to the dealerships to “purchase” the new RVs for inventory, but the dealerships must pay interest, or flooring fees, to the banks monthly until the unit sells. This is why turn rates matter so much.
Along with just having to pay flooring fees to the banks, dealerships are under a kind of deadline to get new RVs moved into a customer’s ownership. Flooring rates go up on new RVs when the new models come out for the next year’s product cycles. The banks perceive these unsold but still new RVs as being a little bit riskier to still have on the sales lots, so they adjust their lending rates appropriately… up.
So right now, the new RVs may indeed be where the better deals are.
Due to demand, used RV prices have been strong. The market says to sell them at a price that people are willing to pay for them. Consumer psychology makes us think we’re being smart by only considering used products, but the dealerships are desperate to unload new RVs that are actually costing them significantly more money to still have in their possession. Used RV prices are in a way up, and depending on the unit, new RV prices are down. You just need to know what you’re looking at. Is it new, but a year or two old? You may find the value there.
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