If things go well, real estate offers investors the chance to benefit from the property’s appreciation and income potential through leases. Beyond traditional commercial and residential real estate, the sector offers a myriad of investment options, including investing in RV lots. Investors who invest in RV parks (lots) might find the investment provides multiple benefits.
An RV lot is a parcel of land within an RV resort or park. Most investors use the lot for income, charging RV owners to use the space for a certain time. The venture has the potential to be lucrative as RV park investing has increased. In 2020, RV and campsites generated $7 billion, growing 2.7 percent between 2010 and 2020. Four years later, the RV market still thrives, offering lot holders with income potential.
The standard RV lot size is between 12 feet and 25 feet wide and 60 feet long for lots at a campground or resort. These lots are longer than other rented lots because they provide RV owners with space for sheds, fences, and other structures. In RV subdivisions, the lots might be larger, ranging from one-tenth of an acre to several acres. This size is based on whether the lot is next to a lake, surrounding attractions, or location.
RV lot investments are attractive because they are inexpensive for investors who park an RV in the lot and live there. For instance, a lot that costs $50,000 requires an investor to place a lot of capital in a real estate investment. However, if the person owns an RV and plans to place it on a lot, they would spend more leasing space from another RV lot owner than financing the $50,000. Furthermore, the amount one might spend on financing an RV lot is less expensive than purchasing the average home.
Outside of being an inexpensive venture, the RV lot presents the person, like most real estate, with the chance to generate income. RV owners are always looking for lots to park while they vacation. RV lot owners only need to place an ad when they are ready to lease the lot, whether it is seasonal or year-round, make a profit, and potentially pay off outstanding debt on the purchase of the parcel. Not only does investing in RV lots present opportunities to generate income, but they also are recession-proof and resilient income. RV lots are recession-proof because they are a low-cost housing alternative. Also, Americans have always RVed as a part of the iconic road trip, which provides the RV lot owner with consistent income.
Investing in an RV lot also presents opportunities to provide affordable housing options for small families or couples starting their lives together. People in both groups often choose to purchase a mobile home and find a lot to sit it on while they save money toward purchasing a house.
The owner can also modify the lot, adding amenities to attract renters. Some RV lot owners build fences to keep pets from wandering. Others have built sheds, small homes, and open-air kitchens to upgrade the lot. Upon selling the lot, the RV owner can earn additional income from the improvements.
Less lucrative benefits include meeting new people and fostering a sense of community. As stated earlier, RVing is an American pastime that involves much transiency, with lot owners staying as little as a few days to months and years. While only brief, the owner meets a diverse group of people. Even without the permanence of other residential communities, the lot owner can create the type of community they desire.
Investing in an RV park gives the investor the chance to be their own boss. While managing a lot can be full-time work, investors can take command of their time.
