Renting Out Your RV – Pro’s and Con’s – A Guideline for You to Follow

So, for the last few posts we’ve made, I have talked about the fact that we are renting our RV out. So, what are the benefits and risks to doing this?

Advantages of Renting Out an RV

Renting out your RV, also called “RV sharing,” offers owners several advantages, and there’s never been a better time to get started.

Extra Income

Chances are, earning money with your RV is one of your biggest incentives for renting it out. I can confirm that we do this because we want to have the RV pay for itself while we are not using it. But how much you earn depends on several factors:

  • Your location
  • The type of RV you have
  • How well your RV has been maintained
  • Any renovations you’ve done to the vehicle
  • Extra services you’re willing to offer, such as pickup/drop off or personalized setup

The RV sharing website Outdoorsy lists the following income estimates, broken down by RV type, for a one- to two-week rental:

  • Class A: $1,953 to $3,906
  • Class B: $1,575 to $3,150
  • Class C: $1,456 to $2,912
  • Fifth wheel: $1,106 to $2,212
  • Camper van: $910 to $1,820
  • Truck camper: $490 to $908
  • Trailer: $749 to $1,498
  • Folding trailer (Pop-Up): $560 to $1,120

Larger campers earn more money because they offer more room and offer more amenities.

But even smaller pop-up trailers can earn a decent income if you rent them out during the summer months, and you might earn enough to at least offset your monthly payments or pay for renovations. Smaller pop-ups and trailers are one of the most popular RV sub-classes because they’re the least expensive, which makes them a favorite for younger generations.

Another strategy you can use to earn an income is to purchase an RV with the sole intention of renting it out full time, much like owning and renting out a vacation home.

Your pricing strategy also affects how much you can earn renting out your RV. For example, you’ll want to charge more during peak times such as summer, holidays, or spring break, and less when demand goes down.

Some owners create travel packages for special events that help them earn more. For example, Burning Man, the Indianapolis 500, and the Sturgis Motorcycle Rally are all popular events for RV rentals. Offering delivery and setup packages or extra amenities during these times could increase your bookings and overall profits.

Sharing the RV Lifestyle

Renting an RV is an economical way for individuals and families to see what RVing is like before they invest thousands of dollars buying an RV of their own. As an owner, it can be rewarding to know you’re introducing people to a lifestyle you love and helping them learn the ropes of RVing.

Most industry reports show that RV camping will continue to be a popular activity, especially among younger generations. According to the 2017 North American Camping Report compiled for KOA by Cairn Consulting Group, it’s estimated over 73 million Americans went camping in 2016, and the number of campers who take three or more camping trips annually has increased by 36%.

In short, more people are trying RV camping, and many of those who do want to camp out more often. By renting out your RV, you help them do this.

Disadvantages of Renting Out Your RV

Buying your RV is probably one of the biggest investments you’ve made in your lifetime, next to your home. Letting someone else occupy it for a week or more on the road can cause owners significant anxiety. You can earn great money by renting out your RV, but there are some clear disadvantages to consider.

Damage Risks

As an owner, you already know the ins and outs of RV camping, and you have a complete checklist to review before transit and during setup and disassembly. However, novice campers don’t have this knowledge and experience, which means they can inadvertently cause a great deal of damage to your rig.

For example, an inexperienced RV renter might accidentally leave a faucet running when they leave for a day-long hiking trip, which then fills the gray tank and floods the entire camper. Or, a renter who’s never towed a trailer may try to back your RV into a campsite and end up backing it into a tree instead.

It doesn’t take much imagination to envision dozens of costly scenarios. By far, the potential damage to your camper is the biggest downside to renting it out. However, RV sharing sites offer both campers and owners an insurance policy in the event a worst-case scenario occurs.

You also need to consider the general wear-and-tear that will, over time, result in damage and require repair. For example:

  • Extra miles put on your camper’s tires, body, and engine
  • Extra use of systems such as the hot water tank, appliances, slides, and furnace (if applicable) that will affect how soon you’ll need to pay for a replacement
  • Damage to walls, furniture, windows, and flooring from dirty hands and shoes, or from unsecured items that fly about during transit
  • Damage caused by pets left inside while the owners are out
  • Damage to the camper body and windows from road debris during travel or from storms that occur while renters are camping
  • Damage to the roof or antenna from renters pulling the RV under trees or low-clearance bridges
  • Damage to the rear end or rear corners from renters pulling out of steep driveways too fast and bottoming out
  • Damage to slideouts when renters don’t retract them fully before travel or don’t check for obstructions before extending them upon arrival
  • Damage to the awnings because renters didn’t retract them before a storm or high-wind event
  • Damage to your generator because renters don’t know how to start it correctly.
  • Damage to the electrical system from not using surge protectors or pulling out of a campsite before disconnecting from the electrical box
  • Damage from hitting an animal while driving
  • Damage from vandalism or theft

You can clearly see how easily a novice camper could cause serious damage to your rig or its accessories. That said, you can mitigate a lot of this damage by creating an instruction booklet and checklist for renters and taking time to educate renters on the do’s and don’ts of camping before they drive off into the sunset.

Some renters choose to limit the possibility of damage by offering their camper as a “destination location.” The camper stays on their property, typically with full hookups, and renters stay in the camper on-site. This option is most appealing for renters when the camper is in a desirable location, such as near a big city, or in a location people want to visit, such as in the mountains or near a beach.

Moving Personal Items Out of Your Camper

You’ll need to remove all your personal items from the camper each time someone rents it out. This can be time-consuming, especially if you live in your camper full-time and opt to rent it out while you’re on vacation or visiting family. However, if you only use your camper for seasonal vacations, you likely won’t have to spend much time on this.

Safety Considerations

You’ll probably need to invest in some upgrades for your RV to ensure the safety of your renters. This is especially true if your RV is a few years old. However, a well-maintained RV will attract more renters because it provides peace of mind.

One investment you’ll likely want to make is replacing your tires. Tires are a particular concern because a blowout can cause an accident, risk the lives of renters if they have to change a tire on a busy freeway, or seriously damage your RV when they explode. Investing in brand-new tires is expensive, but it can help ensure renters have a safe trip.

You might also need to consider these safety investments:

  • Purchasing a fire extinguisher and smoke detectors if your RV doesn’t currently have them
  • Purchasing a quality air pressure gauge and portable air compressor so renters can check and adjust tire pressure on their trip. We chose not to provide these as the rental agent performs these checks pre and post rental
  • Investing in a safety inspection where a qualified RV mechanic checks the brakes, suspension, brake lights, and tires

You can find an RV safety inspector near you by using the National Recreational Vehicle Inspectors Association database. Some mechanics also offer RV inspection services. Prices for a safety inspection vary but typically range between $200 and $500.

Higher Insurance Costs

You likely already have an insurance policy for your camper or motorhome. This policy covers damage that might happen to the vehicle on a trip, such as hail damage or an electrical surge, or damage your camper might cause to someone or something else, such as during a vehicle accident. However, your policy doesn’t cover damages if you rent out your camper to someone else.

Large RV sharing sites like Outdoorsy and RV Share and others offer insurance policies for every owner who lists their vehicle on the site. However, you might want to consider purchasing commercial RV insurance to make sure you and your investment are completely covered. While this can be expensive, keep in mind that you can deduct it as a business expense to offset costs.

Why do you need the extra coverage? The insurance policies offered by booking sites often do not cover many of the damages that are most likely to occur during a rental. Before you rely completely on an insurance policy offered by a booking or reservation site, make sure you read their policy thoroughly — not their summary but the policy itself — so you can see clearly what’s actually covered and what’s not.

Complex Taxes

Your taxes will get a bit more complicated once you start earning an income with your RV. You’ll be able to add your RV as an asset and claim depreciation over a five-year period, and you might be able to deduct insurance costs, maintenance, and repairs. You’ll also have to pay taxes on the revenue you take in.

RV Share has an informative article on the tax deductions you can take when renting out your RV.

The bottom line Considerations

Renting your rig isn’t for everyone. We chose it mainly to mitigate the costs of storage and to insure proper maintenance. Also, it is wise to “exercise” all systems. What do I mean by that?

Well as previous full timers our diesel engine and diesel generator were run each and every time we moved. This keeps the gaskets and seals from drying out through lubrication. And, it kept major systems checked and functional. If we sat static for anymore than a week then I would schedule weekly runs of both engine and generator to once again make sure things were functional and seals and gaskets stayed lubed and pliable.

Major systems should be exercised. These include water distribution and pump, batteries and battery maintenance should be performed, AC/heat pumps run, gas furnaces ran, electric/gas refrigerators ran., toilet valves and waste water storage checked and functional.

How we chose a rental representative

As I stated above, storage is a major consideration. We have stored our Coach before and costs vary from $45-$60 month for outside storage and $100-$250 a month for temperature controlled inside storage. This was something we weren’t willing to deal with. We also need to pay down our coach to make it viable to sell if we choose.

Once we figured out that we needed/wanted to keep our coach, we knew that our alternative was to rent it. Our search began to find a way to do this. Outdoorsy was the first venue we looked at but I didn’t want to store the coach and working with them meant I had to store it, maintain it, stock it, be responsible for customer vetting, insuring insurance was properly applied to our unit and many other considerations.

Once we looked further into renting we found Elite RV Rentals in Phoenix. Elite stores our coach on their monitored property, they do customer vetting, they provide insurance for the rental or if the renter wants to provide their own Elite reviews and checks the customers insurance writer for correctness and insures it will cover our unit. They also have their own RV techs that do scheduled maintenance on the unit and clean and prep the unit prior to rental and the do pre and post walk through’s with the renters to show them how systems work, and all conditions inside and out are confirmed by both the agent and the renter. We pay the maintenance costs and share the rental fee’s with Elite 50/50.

If you have read this and plan to look into the possibility of renting your RV, this guide should help you make an informed decision. Thanks for reading.

Sources: https://www.moneycrashers.comhttp://www.elitervrentals.net/consignment

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