In this blog post, we will answer the following question: Is owning an RV park profitable? If you really want to open your own recreational vehicle (RV) parking facility, then you must read this article, it will help you develop it for profitability in the shortest amount of time.
Is owning an RV park profitable?
Owning an RV park can be profitable in the long run, but it will all depend on what kind of parking facility you are providing, how many RVs/acre you have, and the amount of money and time you are willing to invest in this project.
As a general rule, you could gain between 10% to 20% return on investment per year. To secure a higher number, we recommended you to takes look at the following niche ideas within the RV Park business that you can specialize in:
- Open a camping site for families with children;
- Develop a community RV Park;
- Manage recreational overnight camps;
- Operation of travel trailers and caravan camps;
- Wild camp administration;
- Food and beverage court;
- Ice cream shop;
- Operation of other related facilities.
No matter which line of business you decide to pitch in, you are still going to compete with others who are in the same business area and the RV park facility business is not an exemption.
What exactly are RV parks?
RV parks or “trailer parks” in the United States are a flourishing business that uses a growing demand from low-income people, unable to access a home under normal conditions, to fatten the investment portfolio of some of America’s greatest fortunes.
More than 20 million Americans live in so-called mobile homes, manufactured homes, generally of very low quality, which account for more than 6% of all residential inventory in the country and about 20% in the poorest southern states.
These homes, generally located on a site enabled for mobile or manufactured homes with the minimum services necessary to live, are subject to draconian legislation for tenants, who also tend to access these homes through high-interest loans since their credit history and their low income prevents them from accessing other types of housing or financing.
The bad reputation of the “trailer parks” has meant that since the beginning of the millennium the opening of new “parks” has collapsed, something that has not been done but that the interest in this type of investment is increasing.
Equity LifeStyle Properties, the largest owner of the land on which these homes are located, earned in the first three quarters of this year an additional 7% to 240 million dollars.
Why start an RV Park Business?
Starting a business generally requires cash (startup capital) and if you have enough cash to invest in a thriving business in the United States of America, why not start an RV Park? The truth is, starting a business geared towards children and adults is also a sure way to make money, especially if the business is full of fun.
Keep in mind that the real business in starting an RV Park (Recreation Vehicle Park) business is securing a large facility that is large enough to contain not just the tracks for RVs and other crowded outdoor games, but also a restaurant, enough parking space, and also a location that can attract the kind of customers who would pay to make use of your trailer park.
Starting a standard trailer park is similar to starting a family entertainment centre, and it can be expensive, but you can be sure you’ll make your money within a few years of launching the business. The fact that you are going to secure a facility large enough to accommodate the activities and services you claim to offer and sufficient parking means you really have to be prepared for this business.
If your RV Park facility is high-end and located near a residential development with many growing families, it will attract many children, especially on weekends and special holidays.
Also, you need to take an interest in children and families if you really want to do quite well in this line of business. You must also be able to convince parents and school officials to use your trailer park regularly.
Owning an RV park: economic analysis
When starting an RV park facilities business, you just have to do your economic cost analysis fair if your intent to build the business is to make a profit, grow the business, and perhaps expand the business and start competing domestically.
When conducting cost analysis and economic analysis for your RV park facilities business, you just have to critically examine them for key factors; place, prices and promotion.
In fact, you would have to continue to review these key factors at regular intervals while managing your RV park facilities business or owner of an RV park facilities business, you only need to have a proper understanding of your competitive landscape if you really want to maximize the profit and be on the front line of the industry.
It is important to note that safety and installation maintenance cost is one of the most important factors contributing to the overall cost of running an RV park facilities business and should be considered as an important factor when conducting your economic analysis and costs.
Financing your RV park and camping facilities
Starting a standard, safe, and well-equipped RV Park facilities business requires a lot of capital, even if you choose to start the business on a small scale and only have a handful of full-time employees on your payroll.
Here are some of the options you can explore when looking for startup capital for your RV Park business and camping facilities;
- Raising money from personal savings and selling stocks and personal property
- Raising money from investors and business partners
- Sell shares to interested investors
- Loan application from your bank.
Administrative procedures for opening an RV Park
First, it is necessary to check in the town hall if they do not prohibit the establishment of an area. The regulations for the creation of a service area by an individual can be likened to that of a rural or farm camping site, which limits the number of crews and parking spaces to six.
You must ask the mayor’s authorization and submit a plan with the connection details (water, electricity, sewerage).
For campsite managers, they can create a service area without special authorization. This must be located at the entrance to their land and provided that the number of pitches does not exceed 10% of all pitches on the land.
Each location on the ground must be stabilized and have a minimum surface area of 35m². The duration of parking is limited to one night, renewable if necessary.
List of well-known RV Park business
It is important to note the fact that in every industry there are always brands that perform better or are considered better by customers and the general public than others
These are some of the top RV park facilities in the US and in the world that should inspire and help you create the best RV park in your area:
- American RV Resort
- The KOA Journey Board
- Cotopaxi / Arkansas River KOA
- Deer Park Campground
- Paducah / I-24 / Kentucky Lake KOA
- Perry’s RV Park and Campground
- Manatee Hammock Campground
- Lazy Village Campground-Rv Park
- Durango KOA Holiday
- St Louis West / Historic Route 66 KOA Campground
- Grand Junction KOA Holiday
- Arrowhead Campsites / RV Park
- High Pines RV Park
- Monarch Spur RV Park
- Atlantic Oaks RV Park
- Rollins Restaurant RV Park
- Crescent City / Redwoods KOA Holiday
- Echo Canyon Campground
- Harlan County RV Camping.
The bottom line
If you are thinking about creating an RV park because you are financially cornered and it is your last resort, forget it. A service area is not profitable as the sole source of income. There will be days without a visitor. There will be some dissatisfaction. But in the end, it will certainly be a moral enrichment and the satisfaction of having been able to render a real service.
Please feel free to share your thoughts or tips on creating an RV Park. Or, why not, share your best experience in an RV Park with our other readers. We are curious too!
FAQ on Is owning an RV park profitable?
What is the average size of an RV lot?
The average size of an RV lot is usually nine feet wide by 18 feet long (the full size of a truck).
Are RV lots a good investment?
RV lots are a good long term investment. That is, you have to have patience and do not invest your last resources in this land. In time, it will pay off!
What size RV can park anywhere?
12-inch length RVs can park almost anywhere in the United States. This is almost the ideal length of a motorhome.