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Old 09-09-2013, 10:14 AM   #1
woodlandcottage
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Cool Value algorithims and another "Is this a good deal"?

I live in the mountain region and have been seriously looking for a 2619 or 2720 TM for several weeks now. Casually looking for a few years before that though. Anyway, The Car Show is a well known dealership and we have been there a couple times, but I thought their trailers were overpriced. The used market isn't too much better in this area. I saw a 2002 this weekend that was filthy and falling apart and priced at $8K. I'm not sucker enough for that!
But anyway, I know NADA guides aren't the end all be all with TM, but a reasonable starting point. Here's where I'll get to my first question, or rather, several questions about NADA values.
I'm about to drive an hour away to see a 2009 TM. The asking price with all the options is actually at the NADA average retail. This is a private seller. But I wanted to get an idea of how NADA calculated the drop in estimated value by year so I calculated the NADA for a 2011, '10, '09, and '08 with no options in the model we're going to see. What I found was that the average value of a 2011 was 66% of list, 2010 was 57% of list, 2009 was 53% of list and 2008 was 41% of list. Now the 2008 had a list price of $2K less than subsequent years but I calculated the 41% from the lower value. Now, that scares me a little bit so I tried the same calculations with another model. The algorithm/percentages were the same. I realize that the value of something is really what someone is willing to pay, but there has to be some reason the NADA shows such a significant drop in a six year old model. What could that be? If I were to buy this TM at the 53% value, can I expect it to drop in value by 12% of original value in the first year I own it? That seems to be ridiculous. It would represent a loss of $3K in value in one year. Of course, we plan to own our TM for 10 years but who knows? We may need to sell it and I wouldn't want to eat a loss like that. And that brings me to my next question, since the 2014 models will be released this week, does that now make a 2009 a 7 year old model? Would I be able to use that fact as leverage to ask for a lower price, even a rate of 41% of original price? Thanks so much in advance for any help with this!
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Old 09-09-2013, 11:13 AM   #2
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please don't take this wrong. if you are worried about resale value on an rv-trailmanor or not-you probably should not be buying an rv.

rvs drop in value when they are driven off the lot far worse then cars.

trailmanors are unique, but they are subject to the same rv rules.
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Old 09-09-2013, 01:18 PM   #3
rvcycleguy
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Hmmmm. Well, where do I start... Example, I've got a 2002, 3124KB that isn't falling apart. I paid $8k for it in 2009. If I tried to sell it today, I would ask about the same. Probably settle for $7k. In 4 years, I would have "lost" a grand? No, I used it. That use is worth something, Right? How do you calculate FUN? Camping, family time, adventure, off the beaten path, priceless...

Now, that being said, when using a guide, I don't add in any options to the base value. I assume they will be on it. Awning, AC, jacks, furnace, those are standard items in my book, in my part of the USA. I'm not paying the seller for things he already paid for. His loss, my gain. And they are used items as well. Yes, RV's will depreciate in major way. More than any other vehicle or unit. We all know that. It's not a surprise. One of the reasons TM does not sell that many new ones. Too pricey for most folks. They can get a used one for 1/2 price with less than 3 years of seldom use. That because there are many RVers who trade up. Same for medium size motorcycles. Low mileage, new money is depreciated out and good deal for a buyer.

Most RVs will settle into a value after a few years. A value that will stay with the unit for many years considering its in good condition, not falling apart, clean, does not show it's age. They are practical, ease to tow, sleeps a family well and most casual RVers wouldn't know what year a TM was if it was sitting next to them. It's not like a car when the 2014s come out and make last year obsolete.
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Old 09-09-2013, 01:49 PM   #4
Redtail Cruiser
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The NADA guide is a good place to start; however the condition of the unit and the timing of your purchase are important factors. I looked at a number of units and found that there are older units in much better shape than newer ones.

I also decided to wait for the off season to buy mine. When people are trying to pay for Christmas or worried about there tax liability, it is a good time to buy anything used. So when I bought my 2007 2720 last winter, the seller had it up for $14K, but was in need of cash flow, so he accepted my $10K bid. It was in better shape than the 2010 that I had looked at three weeks earlier that the seller wanted $19.5K for.
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Old 09-09-2013, 02:25 PM   #5
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You probably realize this, but when you go to NADA and check off options, be sure you check off only the real OPTIONS. Example - air conditioner is an option, DSI water heater is not. The first step is to check the TrailManor web site for the year of your interest - 2009 in your case - to see what the options were for that year. They change a bit from year to year. Not necessarily easy to find a copy of the 2009 web site, but you may have luck at the Internet Archive at archive.org, aka The Wayback Machine.

Resale value and depreciation is an interesting topic. But I agree with previous posts. If you get too hung up on resale value, you will not enjoy the experience.

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Old 09-09-2013, 04:42 PM   #6
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Thanks so much for the replies! I hope I'm not hung up too much on potential resale value, but I am risk averse and there is such a thing as resale value(because other people are reselling them and I have to know a basic range just to buy one) so it makes sense to know what it is so I can work my way into being comfortable with that should I eat a loss more than what I think is fair use and depreciation. I'm very comfortable with a loss of value under $2K a year since it lines up very well with what we normally spend on lodging for family vacations.
It was that 12% NADA value drop in one year that makes me jittery. It makes me think I should wait until NADA published the next year of values and bumps all the other ones down. Am I right that that is how it works? I really just want to know if I should pay the 53% of original value(since this is what the NADA currently has up) or the 41% since the 2014 models were just released and that should decrease the value for all older models. This represents a difference in value of about $3K so it's not exactly chicken feed. Not for our family of five anyway.
I purposely put off seriously shopping for the TM until near-after Labor Day. I assumed(correctly may I add seeing the huge increase of TM listings lately)that people would list their campers at the end of the season due to lack of use and cost/hassle of storage options. More on the market usually means easier to negotiate a reasonable price. I don't need to have bragging rights to the lowest price paid for a TM but I sure don't want to be the dunce who overpaid.
Right now there seems to be a fair amount of 2619's available within 500 miles of me. I'd really prefer the 2720 with the swing hitch though. We get a lot of hail out here in CO and I want to do my best to prevent hail damage by keeping my baby in the garage. And a queen bed is just so much nicer than a double. I'm married to a sprawler.
It's really hard to decide to pursue getting a 2619 to get started now, since there seem to be enough available, or just wait for the right one. Since there isn't more than one month or so left in the camping season for my neck of the woods, I'm leaning strongly toward taking the time to find the 2720, but looking at others in the meantime just in case.
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Old 09-09-2013, 10:09 PM   #7
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woodland - Don't get hung-up on a price as a % of original list. Each unit has been cared-for differently, and that is what you should be looking at. Value.

I looked at two different 2009 units in the last few months. One showed a little wear, and the other showed lots of wear. That is what I would look at, much more than % or original price. I wouldn't touch one of them with your money, even if it was below your perceived price-point for that year. The other was a good deal, and it was very close to NADA. Coincidence that it was close to NADA.

Right now, there may be a few units available that you are interested in. Next month, maybe not. The ones that are priced right will likely move quickly, as there seems to be more interest in TM trailers. If you watch the For Sale section of this forum, most units don't seem to last long, if they are in good condition. The ones that show their age seem to be around longer.

Opportunity doesn't knock very often. If you see a unit that is clean nad everything works properly, it could be a good value, even if it is 10% above the value-curve you are using. Don't get too hung-up on ratios. Paralysis by analysis, and you may miss your best value while analyzing.
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Old 09-11-2013, 12:21 PM   #8
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Having fun camping and traveling...priceless. Family experience...priceless. New adventures...priceless. Within reason, at some point one has to let go of the numbers and enjoy.
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Old 09-11-2013, 03:25 PM   #9
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Quote:
Originally Posted by moaboy View Post
Having fun camping and traveling...priceless. Family experience...priceless. New adventures...priceless. Within reason, at some point one has to let go of the numbers and enjoy.
Ditto. Even after the capital cost of the TM and subsequent maintenance, we've spent many thousands of "extra" dollars on fuel towing the TM. I don't even think about it any more, and I wouldn't have traded those experiences for anything.

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