CNBC ran an article recently that talked about the attractiveness of living in an RV full time. We are seeing this same phenomenon in many of our properties throughout the U.S. So, what does it mean for the RV Park industry if we start filling more and more spaces with full-time occupants?
Why is this happening?
America is in the worst affordable housing crisis since 1776. The average single-family home in the U.S. costs over $400,000 and the average apartment rent is around $2,000 per month. Against this backdrop you have 10,000 American Baby-Boomers retiring per day, as well as Millennials who simply cannot afford those housing expenses. The result is that millions of Americans are starting to realize that they can live in their RVs full time and save a fortune on housing costs, with the additional benefits of pleasant surroundings and camaraderie of the RV Park. It’s no more complicated than that.
The financial benefits to RV Park owners
The average RV Park customer stays for 14 days per year. A full-time customer stays for 365 days per year. So, one full-time customer is as important for your business as 180 normal customers. When you fill up your property with full-time customers you logically see huge spikes in revenue. And, of course, with greater occupancy and greater revenue comes a higher appraised value for your RV Park when you go to refinance or sell it.
The operational benefits to RV Park owners
Full-time customers have other benefits besides just money – they have real operational horsepower. Here are some of the additional benefits from gaining full-time customers:
- Gives seasonal RV Parks management continuity. When you own a seasonal RV Park you shut down for typically half the year in the off-season. As a result, you can’t afford to have a full-time manager year round, so you get a new manager every year – typically from a work camper website. Full-time residents allow you to afford full-time managers even in the off-season.
- More consistent cash-flows to pay mortgages and essential bills. There’s no better feeling than having all of your fixed bills covered with those full-time customers’ revenue. That means that the traditional customers are gravy and you have only upside each month.
- Less marketing requirements. Clearly, every time you bring in a full-time customer you eliminate the need for marketing of that space. It makes the entire advertising/marketing function much easier.
- Creates a sea of ambassadors for your property. Full time customers have many friends who have similar interests, as well as blogs and social media that announces their new lifestyle. As a result, they effectively become ambassadors for your property and bring in others – and at no cost to you.
How to attract these customers
The most important thing you can do as an RV Park owner is to let full-time customers know that you want their business. You can accomplish this in the following manner:
- Proper marketing. Those who are seeking a place to live for a lifetime need marketing that states that full-time occupancy is welcome. So, state clearly in advertising that customers are free to stay for a day or a lifetime.
- Be open to full-time residency. Many RV Park owners fail to understand the opportunity that this type of customer affords and – since it’s not what they’re used to – they tell them “no” when they ask if they can stay on a long-term basis. Make sure your manager understands your desire to bring these customers into your RV Park.
- Have options for those who do not already own an RV. There is more than one option to live in an RV Park full-time – and you should know those options and suggest them. One idea that is gaining traction with many operators is to bring in “park models” or “tiny homes” that offer some upgrades in size and creature comforts on traditional RVs.
- Provide the information necessary to qualify as a nice place to live full-time. When you stay for a week or two at an RV Park you are not obsessed with such options as shopping and medical care. But those are the types of questions you will be asked by those looking to stay for a lifetime, so be ready.
But do some homework first
Not all state, county or city laws allow RV Park customers to stay full-time. Sometimes you will find that you can only have a certain percentage of customers on a full-time basis, and in other times you will find that there is a time limit. So before you start to bring in these customers make sure you know the laws regarding your property. Don’t assume that the bureaucrat you are talking about is an expert on the topic, so ask to see the written law and – if you disagree – voice those concerns and get to the bottom of it. Never accept an opinion unless it’s backed up by factual evidence.
Conclusion
Full-time RV Park customers are a trend that will be accelerating going forward. Many people are going to look to RV Parks as a great way to live economically as housing prices continue to climb out of control, and RV Park owners will be lucky recipients of this new reality.