The average RV owner in the U.S. plans on hitting the road two weeks per year. Yet there are many customers that plan on 52 weeks and have no home other than their RV. Indeed, the RV park industry is seeing new forces for permanent housing in addition to temporary residency. So what are these new occupancy sources and what will the impact be on the RV park industry?
Living in RVs for retirement
A big trend in U.S. housing are Baby Boomers (10,000 of which retire each and every day) electing to sell their homes and live out their retirement years in an RV on the open road. Of course, they eventually get tired of changing locales and stop in one single RV park for a number of years. You can see this in RV parks across the country, and there’s certainly nothing with that. On the contrary, such heavy RV park users boost revenues and give a higher level of stability to occupancy. We believe that this phenomenon will continue to grow over time and have very long tenancy as most of these Baby Boomers have a remaining life expectancy of two decades. Their example is also causing some non-retirees to consider the same form of housing choice despite the fact they’re in their 50s.
The rise of the tiny home trend is obvious, from HGTV shows to the cover of most architectural magazines. Living small is a hot choice for both seniors and millennials, and this phenomenon shows no signs of slowing. What most people don’t know is that the only legal place to put a tiny home (other than on your own land in the county) is inside an RV park. Since most tiny home owners are not giant land owners in rural areas, this means that RV parks essentially have a monopoly on this housing option. These are permanent structures that are typically very attractive and fit in well with the entire RV park streetscape. We drove through an RV park in Indiana recently that had an entire section of tiny homes – like a tiny subdivision – and it looked fantastic. Obviously, this is a trend that bolsters RV park revenues and stability, but also allows RV park owners to garner revenue from areas that typically were non-income producing. Since tiny homes arrive on skids and not wheels typically, they don’t have to occupy traditional RV lots. You can place them in green areas are spots that are not adaptable for traditional RV placement.
There is an entire movement towards “glamping” (which stands for “glamour camping”) and RVs are a big part of that concept. Essentially, a classic RV from the 1950s or 1960s is renovated to be used as an Air BNB unit, which is then marketed on the AirBNB websites. These type of offerings fit in well with RV park streetscapes and give one more option to potential customers (as well as reaching customers in an entirely new marketing sector). While park models are extremely expensive ($30,000 or so in many markets) you can buy and renovate a classic RV for less than $10,000. If you are unfamiliar with this business model, Google it up and you will understand it rapidly. We see this trend growing as millennials – who are huge fans of the outdoors and nostalgia – relish the ability to step back in time and to do so in a fun and rewarding way. And, just like tiny homes, you can place these in areas of the RV park that are currently not income producing, such as around a lake or greenspace.
Don’t be afraid to try new things
In all of the above trends, the key is for RV park owners not to be afraid to try new things – mainly because it has no risk or negative impact to your existing business model. Many of these concepts are creeping up on owners without them really paying attention to the shift, but it would make more sense to harness the power of these movements and use that to better enhance your revenue and stability. Walmart was built using the concept of testing new concepts and measuring their results, and it’s a good concept for RV parks too, especially given the changes in American tastes and attitudes on lifestyles
The RV park industry is aided by the fact that there are entirely new ways to gain occupancy that don’t simply meet the profile of parking an RV on a lot. Embrace these alternatives and see if they would work for your RV park. You have nothing to lose and everything to gain.