When Will RV Prices Go Down?
Anyone looking for a new (or used) RV these days is in for a shock when they ask about RV prices. The cost of an RV is at an all-time high after 2 years of pandemic-fueled price increases. The pandemic created unprecedented demand for RVs for 3 main reasons:
- RV travel and vacations were seen as a solution to pandemic travel restrictions. This included both air travel for holidays or even work-related trips. RVs also provided a perfect way to isolate and social distance while enjoying a family vacation.
- Many jobs became remote. During the pandemic, employers and employees both realized that many positions no longer require the physical presence of employees. Widespread use of virtual meeting platforms like Zoom and Google Hangouts made it possible for many jobs to be performed from wherever employees have access to the internet. Many employees have used this new freedom to embrace a nomadic lifestyle, for at least part of the year.
- Housing prices have been skyrocketing in the last 2 years. This has had some adventurous people thinking that an RV provides all the living space they need, with the freedom to relocate whenever and wherever they want. This is perhaps especially true of those who are able to work remotely.
Between 2020 and 2022, the demand for RVs was huge. The supply of RVs, however, was not.
Supply chain interuptions and worker shortages
Aside from causing increased demand for RVs, the pandemic years also saw supply chain interuptions and shortages. RV manufacturers found themselves waiting for parts and supplies that were needed for the production of RVs. Just as importantly, there was also a shortage of plant workers and RV technicians. This didn’t bode well for the production of new RVs. Dealers soon found themselves unable to order nearly enough RVs to meet the new demand for them.
A simple rule of economics is that prices increase when demand exceeds supply. In 2021, RV prices reflected the unbalanced state of the RV market. The price for a new RV increased to higher levels than have ever been seen in the industry. And they’ve pretty much stayed there.
Increased supply
RV supply in 2022 will increase for both new and used RVs. RV manufacturers are finally catching up on production of RVs. This means RV dealers are once again seeing almost normal numbers of RVs on their lots. There are also a lot of used RVs coming onto the market. People are now able to hop on a plane and visit their favorite resort.
Some people who bought RVs in 2020 or 2021 are now realizing the RV lifestyle isn’t necessarily for them. Rampant inflation on everything from consumer goods to fuel has many people second-guessing their RV purchase. For some people, selling while RV prices are high just makes good sense.
Demand stabilizing
Record fuel costs and rampant inflation will keep some buyers out of the RV market in 2022. As vacation options open up again, some buyers will lose interest in purchasing an RV for family vacations. However, new demand for RVs from the millenial age group is keeping demand for RVs stable.
Will RV prices go down in 2022?
There will still be enough demand for RVs to keep prices high through most of 2022. The good news is that we are unlikely to see further increases in RV prices as the market stablizes. The bad news is that we are unlikely to see prices go down substantially on new RVs. By October, when faced with either storing the RV or selling it, some new RVers will choose the latter. The fact that prices will still be high will make this even more attractive.
We will see more used RVs come onto the market around the middle of October. This increased supply and slackening demand may well lead to used RV prices going down. However, unpredictable world events continue to impact supply chains and effect the US economy. 2022 may see shortages of essential RV components such as aluminum and various RV appliances. We won’t hold our breath for RV prices to go down this year.
One of the best parts about RVing is engaging with the community of traveling enthusiasts. iRV2 forums allow folks to chat with other RVers online, and get other perspectives on everything RVing, including products, destinations, RV mods, and much more.
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Units are starting to pile up at dealers… I was looking to purchase a slightly used DP, however most owners are still trying to hold prices. I guess they believe there is still a high demand and they are looking to break even or make a profit on the resale. Those days have ended. You can see huge disparity in market prices. Some of the high end coaches I am looking at have a 100k difference for same year and model. New DP are so far out of market priced compared to used market, I believe dealers are going to be in trouble as we transition back to lower prices. They are going to somehow move the inventory. It’s as if the music has stopped and they are stuck with inventory. I plan to wait another 4-6 months, when I believe there is going to be a larger selection at lower prices.
The purchase of an RV is discretionary…a big ticket luxury item that most of us can certainly do without. High interest rates. High fuel prices. Then there’s insurance, maintenance etc. A stock market that has taken a beating. Then, you gas up your RV on your credit card at high rates. You drive to a campground whose rates have also gone up because of demand. AND you may be making big payments all year long for something that gets used for 2 or 3 weeks in the summer. As the saying goes, “that dog don’t hunt”. There should be an absolute collapse in the price of RV’s by the spring of 2023.
But, I’ve been wrong before. Perhaps we should never underestimate the power of the American consumer.
I believe by end of year you will see a 10k drop in travel trailers, 20k in high end 5th wheels, and at least a 50k motorhomes costs, it’s inevitable.
This is a strange year to make a call on whether prices will go down or stay the same. Inflation will definitely affect prices for the new models and start them out higher. But will spending trends drag those back down? I think you’ll see a small drop in the remaining older inventory but not like you’ve seen in the past. People are considering RV’s as a cheaper alternative to traditional “house” living. If that becomes a trend then you will see prices steadily increase. I think the next month will show a direction. I don’t like him but, Warren Buffett is no idiot and he doesn’t own most of the RV manufacturers because he needs a loss. I think he sees the writing on the wall.
The only real indicator I follow is RV auctions. I’ve been watching them closely and the June auction was soft. The busiest time of the year for RV sales is late spring/early summer. Seeing a soft auction during this window is a precursor for what is headed. The market is going to make a major correction. If you are thinking of selling it’s probably too late but now is the time. If you are thinking of buying I would wait until this winter.
My sentiments exactly. I have been running the exact same used RV searches once a week for over six months and the prices are definitely softer and the supply is higher. Once the summer camping/vacation season comes to end, there will be a lot of sellers. With the anticipated economic headwinds, this winter will be a great time to pick up a deal on a used RV. I think the higher tier RVs will be the greatest value, as many wealthy people experimenting with RVing during covid and will decide its not for them.
Mike, where could I see current auction prices as you do?
The prices for new RVs can’t come down because of inflation. But what will happen is that demand for them, especially the luxury ones, will go down. First, wages have not kept up with inflation. The stock market has markedly decreased this year and will likely continue to do so. Interest rates for RVs have always been relatively high (compared to home mortgages) and now they will go higher. While the interest on an RV loan can be deductible, for most people it will be less than the standard deduction, so there won’t be any tax advantage on an RV loan (unless you’re pulling the purchase money out of an IRA, etc.). The cost of RV travel at 5-7 miles/gallon is very high. People will need to recalculate what they can afford and they may try to purchase a used RV or one smaller or less luxurious than they had originally planned. This will really affect the RV manufacturers in reduced orders. They’ll have to cut costs by laying off workers. Some manufacturers will go bankrupt, others will get bought out. If you doubt this, just check the price for WGO stock (Winnebago). It’s 52 week high was about $85/share, now trading around $54. That’s over a 36% drop in price! This is obviously not a good year to buy or travel in an RV.
RV prices can definitely come down, not only during inflation, but precisely because of inflation. Don’t everything think otherwise. RVs are the ultimate discretionary spending along with boats. With essentials like gas, food, utilities going up, this will squeeze out discretionary spending and lower demand substantially. Reduced demand will always trump inflated input costs. The RV manufacturers will be forced to cut production and layoff workers.
Jay, you’ve just made the perfect case for prices going DOWN! A “down” stock market means less money for descretionary spending. An RV or boat is the ultimate in descretionary outlay. Prices (both new and used) will go down.
Thank goodness we purchased our travel trailer when we did in January 2021. At that time it was already $3000 more than in January 2020. A short 9 months after we bought ours, the price had risen almost $8000 more than what we paid. That price would have put us out of the RV market as we are retired and on a fixed income.
Very informative. Answered all my questions.
RV prices cannot come down because people are not going to pay more for a ‘22 model than a ‘23 model on dealer’s lots. If ‘23 models were less, dealers would be stuck with the large amount of ‘22 models they have and that are coming. The only thing that could curb this would be manufacturer or dealer rebates like what is offered in the car industry.
Many people have been watching from the sidelines and will not buy until prices do come down, and this winter will be the winter of death and hospitalization for RV dealers who sit on their stock.
May I add an important reason for a rv other than vacations is if a wild fire forces you to evacuate your residence, you will have your home on wheels to live in a safe place.
You will still the MSRP costs of new RVs go up as long as inflation is here and material shortages are present. Second the lack of skilled people to build them will push labor costs higher and not help quality.
I believe prices will go down and continue to go down, as long as gas prices remain high and interest rates go up.
The prices have gotten so out of hand and almost impossible for many to afford. Very disappointed in what has happened to the rv industry.
You’re foolish to think any manufacturer will generally lower prices regardless of the economic fluctuations. They will attempt to package in additional bells and whistles and offer select sales discounts but the baseline will never return to pre-pandemic levels. The bean counters will never allow that.
The bean counters as you put it will have no choice. If they don’t sell their product they will go out of business. If Market dictates their prices are too high they will have no choice but to lower them it’ll come you’ll see.
22’s will drop when 23’s come out just like cars. They’ll need to get the 22’s off the lot first before the 23’s come in.
April sales are down 27% as compared to last April. Don’t know about May but I’m sure that’s down to.
Lots are filled now and according to “The Nerd” some manufacturers are down to 4 days a week instead of 6. That should tell you something.
The Class A, B, C & FW are only affordable by rich people since they’re over $100,000 so I doubt they care about gas or inflation.
Travel trailers are more for regular people.
And there’s lots of used ones up for sale lately.
Alot of people thought they were rich with the helicopter money. On airforums classified, there is a glut of 25 ft and larger used AS’s way over priced just setting there for months. They bought high and will have to sell low or keep shelling out 1k$ a month on payments and storage. August should be the start of the fire sale.
Exactly!
It is wishful thinking to expect pricing to stay the same. I build houses in NC and from the peak on a $450k house, pricing is already down nearly 10%. As lumber prices drop and interest rates rise, i will have to reduce house pricing further if i want to stay in business. There sure are a lot of common parts in RVs and houses so i expect that market to drop as well, but probably even more drastically. I will be shocked if we don’t see dealers start fire selling soon!