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Part two: RV parks and big money investors – Are they building trailer courts or RV parks?

By Andy Zipser

Read part one of this story here

American housing prices have been on an unsustainably steep climb for 10 years, far outstripping overall inflation and wages, but the pain is not distributed evenly. And as those with modest means scramble for affordable shelter, their traditional refuge of last resort – the mobile home or trailer park – increasingly is priced out of reach. As reported in part one, a captive customer base of people with nowhere to go is a customer base ripe for rent gouging. Don’t like it? Can’t afford it? The streets are waiting.

For some, however, RV parks are becoming an intermediate stop on the slippery downward slope to homelessness. True, RVs manufacturers explicitly state their products are not intended for full-time residence, but everyone knows that’s just window dressing. Although scantily insulated and with as little as a hundred square feet of living space, RVs nonetheless have kitchens and bathrooms and a front door that can be locked, however imperfectly, and that’s more than you can find on the sidewalk. Meanwhile, zoning officials all around the country, under pressure from campgrounds and RVers desperate for longer-term accommodations, increasingly are modifying or lifting length-of-stay restrictions at RV parks.

And so, increasingly, those with nowhere else to go are knocking on RV park gates. When I owned a campground, those calls typically started with the question, “How much does it cost to stay at your park?” Well, I’d answer, it depends on the kind of amenities you need, whether you are okay with a back-in or need a pull-through, and what night of the week you want to stay. “Oh, I mean for more than a night – I need something long-term,” would come the reply. Okay, I’d say. In that case, you’ll want a full hook-up, but will that be 30 amp or 50 amp? And how long is the unit?

That would elicit an awkward silence, followed by an admission that the caller didn’t know the answers because he hadn’t bought an RV yet – but had a couple he was looking at.

Those calls usually never went any further, especially when I added that we had only a handful of long-term sites, that they were all booked up and that we had a long waiting list. But they also became more frequent, as did inquiries about whether we were accommodating tiny homes (we were not). So did the number of tent campers who would reserve a few nights, then keep extending by one or two nights at a time until we understood that these, too, were homeless people looking for a place to stay.

Unfortunately, these developments have not gone unnoticed by the people who’ve already made mobile home parks increasingly unaffordable. And while some of the new breeds of RV park investors are angling to make them more high-end properties, adding enough amenities to justify stiff rate increases in a process they describe as “forced appreciation,” others are bottom-fishing instead: taking conventional RV parks and running them more like trailer courts.

RVPark University, as a leading example, has a short video titled “Everything you need to know about RV park investing in 3 minutes.” The handful of points illustrating how lucrative the business can be include “No on-going capital improvements (you only rent the land – no roofs or toilets to fix)” and “You can raise the rents whenever you want.” Putting aside the fact that even mobile home parks have infrastructure that needs to be maintained, those are the kinds of statements that scream “trailer court,” not “RV park,” and are deeply indicative of how the folks behind RVPark University view this market niche.

FURTHER UNDERSCORING THAT POINT is a book by Dave Reynolds, one of the two partners behind RVPark University, titled “How to Buy, Sell and Operate RV Parks and Campgrounds.” Despite being written immediately prior to the Great Recession of 2008 and only minimally updated since, Reynolds’ book is still promoted on the RVPark University website, where it sells for the outsized price of $39.95 on Kindle or $44 for the paperback. Yet, despite the all-encompassing title, only two-and-a-half pages of a 179-page volume are dedicated to the actual management of an RV park (and a half-page of that is advice about hiring a manager). The rest is all about the numbers going in and how to make them better before getting out. And on the latter score, the bottom line is to deliver as little as practical while charging as much as possible.

For instance, the one detailed example Reynolds provides to illustrate how to minimize expenses presents a hypothetical campground of 100 RV spaces on 15 acres – to be operated by just the owner and his wife, each working a mere 30 hours a week. The only other staff would consist of a work-camping couple to fill in at the office one to two days a week, and to help with maintenance “for a couple of hours a week.” That may be an adequate staffing level for a mobile home park, but never for a conventional RV park that has people making reservations and checking in throughout the day, bathrooms and other communal buildings that must be cleaned, maintenance issues with plumbing, sewer and electrical, grass to be mowed, and on and on.



Meanwhile, Reynolds advises, “increase the value and profitability of your RV park” by raising rates and, where possible, metering and charging for water and electricity.

Not every investor jumping into the RV park niche is a bottom-feeder, of course. Heather Blankenship, for example, hosted a webinar a couple of weeks ago for prospective RV park buyers that she said attracted 1,500 participants. Although acknowledging that some RV parks can be operated more like trailer parks, Blankenship’s emphasis was on glamping resorts and RV parks that operate more like resorts or hotels because of their “incredible” cash flow – cash flow that can be further boosted by improving a property enough to justify rate increases, as well as adding additional revenue streams by charging for various amenities.

Blankenship, unsurprisingly, is willing to teach you more about the subject of “aggressive asset accumulation” via her RV Park Investment Course, a $4,500 value that she’s making available for $997.

Taken together, the two investing approaches exemplified by Reynolds and Blankenship portend a future for RV parks that reflects broader social trends, of bare-bones on one hand and resort-class accommodations on the other – and even less in the middle. And given the reported turnout for Blankenship’s webinar, there are a lot of people eager to make that happen sooner rather than later.

Andy Zipser is the author of Renting Dirt, the story of his family’s experiences owning and operating a Virginia RV park. The fascinating book, recently published, is available at many large bookstores and on Amazon.com.

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Machelle James
5 days ago

We built and own a 15 acre, 43 site RV vacation campground. It is more work than you could possibly imagine. My husband and I love it and we have only been open for 4 months. We meet the nicest people and have a good rapport with our community. The neighbors will definitely protest a 100 RV/Park models on 15 acres. Our County planners use our business model when other RV Park Developers come to town wanting to build. They come see our Campground, the space/privacy between sites and are either WOWED or they move on as they just want $$$. There is a fine line between being greedy and being good for the community.

Danica
16 days ago

We can afford to live elsewhere, but enjoy the freedom of being on wheels if we choose. We are not homeless and my husband has a high paying job. We have discovered that we are saving a TON by living stationary and are saving up way faster so we can purchase land and build our dream home.

Virginia
17 days ago

No toilets to fix? Tell that to the maintenance guys unstopping those sewer lines!

Melanie Wagner
17 days ago

I inherited a small RV park (36 sites) a year ago and I found this article very indicative of my experience. I have a lot of “monthly” sites and I’m struggling between being a good business person (raising rents, etc) and being a good person because many have no where to go. I’ve invested over $40k of my own money in park improvements to make it a nice “overnight” park. But even at 36 sites (13 overnight sites), its A LOT more work than I ever envisioned. I bought RV Park University and there was some helpful info but its misleading when it says create your own hours, etc. This is a 7-day a week, 10-12 hour days for a single person (me) and a part-time maintenance person – for a “small” RV park. Even a couple wouldn’t have any time off. I thoroughly enjoy what I do but I am mentally and physically exhausted by the end of the day. Potential RV Park investors shouldn’t be fooled by the “marketing” people – this is no walk in the park (pun intended).

Dave
12 days ago
Reply to  Melanie Wagner

Melanie. Thanks for your balanced comments. You can be a good person and good business person. Raising fees do not make you a bad person. Every real estate landlord has the same issue. Every common sense campground owner doesn’t have to follow the models discussed in this article just as I don’t buy into the wonderful RVing experience portrayed by RV bloggers. RV parks never were intended to be homes for low income housing.

Janet Alexander
17 days ago

I am one of those that found myself on a slippery slope to near homelessness after a divorce. I hadn’t worked a regular job for ten years and was traveling four times a year teaching silversmithing at conferences. I never thought I would be on my own at 64 years of age. My teaching wasn’t enough to pay apartment rent of $1200 + living expenses. I use to be a technical writer and tried getting a job doing that, but no one is interested
I bought and moved into my TT to live in temporarily in 2018. The shows I taught at have all gone out of business due to a decline in attendance and Covid. I’m bought some land with still the hope of having a home again. I live in a mobile home/RV park in SLC. The rent is $650 and the owners just sold it to an investment property management company. Which is in the process of adding more amenities. They are raising the rent $100. I’m sure that will go up even more once they finish improving the place. I see many single women here with no place to go.

Bob p
17 days ago

I love how marketing people market themselves offering a $4495 package that only costs $997. They may as well say $1000 but that sounds much larger than $997. Lol

BA Lopez
17 days ago
Reply to  Bob p

Yes, standard marketing tactics. I attended Frank & Dave’s MHP Bootcamp a few years ago and man have they changed their minds about RV Parks! They would not touch them back then but I guess they’re trying to add to their empire now.

It’s a sad reality that there is a total lack of truly affordable housing. The business model just doesn’t make sense for investors. With so many local jurisdictions making it almost impossible to build a new MHP or RV Park, it only gets worse. Limited supply of existing pad sites means owners can ramp up prices b/c they have limited competition. More unintended consequences of government over-regulation

Ellen L
16 days ago
Reply to  BA Lopez

BA Lopez, I’m confused by your mention of government over-regulation? The “local jurisdictions” you speak of are the ones determining the permits for RV parks, and decisions are always made after holding public hearings. I’ve read many, many articles about local residents’ resistance to new RV parks. So the local city/county councils are just listening to the public and acting accordingly. I’m of the mind we need more RV parks, not just for long-term residents who’ve no other place to go, but for people passing through. The mid-Atlantic, in particular, could use more, but it’s the local residents who are shutting down proposals.