Economics of a holiday caravan - any experiences?

[littleredrooster]

With our impending move away from the Midlands, we are considering buying a static 'van on a site so we can retain a base (of sorts) to see the grandkids.

After a brief look, there appears to be a huge difference in both site fees and initial cost - my initial thought was to able to let it out at peak season to generate enough income to cover the annual fees so that we effectively got it 'free' for the remainder of the year.

Anyone done/got anything similar, any tips on what to avoid/how to go about it?

[anonymous-user]

Don’t, you will lose money, lots of it.

Annual (rising) fees, limited ‘open’ months, your £40k caravan will be worth £5k in 3/5/7/10 years or whatever the site rules with respect to age of caravan (and guess who you have to buy from & sell too), monthly ground rent, extortionate bills.

It’s a racket, cheaper to rent / B&B when you visit.

[Ziplobb]

Firstly I have never had one myself BUT there are several parks here on the Isle of Wight and I am aware of a number of people I know who have bought caravans over the years. The seller or park owners lure buyers in with the promise of easy rent BUT there are several stings here: massive increase in pitch rent year on year; very tight contracts that control who you can sell or rent to; expensive finance; hidden bills that manifest themselves in the future for maintenance. One of the worse ones though is when you dont play ball (for whatever reason) and your 'plot' is marginalised in someway for example nearly groundworks that never finish or some other blight that means no one including the owner wants to be there.

My advice - get yourself a motorhome or touring van. Its yours , the annual upkeep will be much less and its an asset you can turn into cash easily if you want to. You can also have a lot more flexiability about where you can go and stay.

[Camelot1971]

Some of the parks have fees of £900+ PER MONTH just for the privilege of having a caravan there. That's before any other costs. The only people making money are the park owners.

[Jockman]

Go in with eyes wide open.

Financially they are a poor investment for you. Not for the family members you allow to use it FOC of course.

Emotionally they will tick many boxes. A good bolt hole for you and for taking grandkids.

Site Fees are negotiable. Our current fees are in the region of £6,500 pa. We pay £2,012 based on an offer in that year. For life.

Additional costs are circa £1,000 pa - insurance is the biggest after site fees, then gas, elec, water, boiler service, water rates, council tax (tiny).

Our site never shuts. Never. Christmas & New Year parties, swimming pool, restaurant, boat house, tennis courts, kids activity schedule etc.

[littleredrooster]

Camelot1971 said:

Some of the parks have fees of £900+ PER MONTH just for the privilege of having a caravan there. That's before any other costs. The only people making money are the park owners.

Wow!! Whereabouts are they? Must make a note to avoid!

Some that I've looked at are ~£3kpa but >£10k is ridiculous!

[Fastpedeller]

littleredrooster said:

Camelot1971 said:

Some of the parks have fees of £900+ PER MONTH just for the privilege of having a caravan there. That's before any other costs. The only people making money are the park owners.

Wow!! Whereabouts are they? Must make a note to avoid!

Some that I've looked at are ~£3kpa but >£10k is ridiculous!

There's your answer - 3kpa is several B&B weekends and no hassle!

[CubanPete]

I think some of the small private ones can make sense if you have a particular affinity to an area.

We looked, very briefly , at a south coast site and it looked appealing at first glance, but once you read through the numbers it was very expensive, and difficult to get out of.

The cost would have paid for a nice camper van or regular B&Bs or holidays abroad.

[mike9009]

Ziplobb said:

Firstly I have never had one myself BUT there are several parks here on the Isle of Wight and I am aware of a number of people I know who have bought caravans over the years. The seller or park owners lure buyers in with the promise of easy rent BUT there are several stings here: massive increase in pitch rent year on year; very tight contracts that control who you can sell or rent to; expensive finance; hidden bills that manifest themselves in the future for maintenance. One of the worse ones though is when you dont play ball (for whatever reason) and your 'plot' is marginalised in someway for example nearly groundworks that never finish or some other blight that means no one including the owner wants to be there.

My advice - get yourself a motorhome or touring van. Its yours , the annual upkeep will be much less and its an asset you can turn into cash easily if you want to. You can also have a lot more flexiability about where you can go and stay.

I live on the island too and the whole thing is a complete scam. I know a couple who lost approx £60k in about 18 months - they were warned but got caught up in the sales pitch. At the end of the day they are adults. They were mortgaged in a small house before then took this daft move and are now living in rented at 60 years of age... Doh! The site owners are complete con artists.

I would look elsewhere for a base....

[Foliage]

Cheaper to get yourself a really really nice motor home.

[Hub]

Site fees you might be able to stomach, but if then the 'van is then effectively worthless in as few as 10-15 years because of maximum age requirements for private letting or even keeping on the site, then it doesn't really seem viable.

[Darumvej]

A touring caravan would be another option, a really nice one can be bought for half the price of a static or motor home.

Some sites will let you store at their site and even set it up for your arrival, much more cost effective.

[oldaudi]

I looked into getting one with Haven. I saw some cheap ones on their website, figured I could buy one, rent it out and have some “free” UK holidays. I did some research and they appear to be a money pit. The ones Haven had for sale would be too old to have on their site after about 2 years. They would happily sell it to you and then hide in the small print that it’s coming to the end of its life and too grotty to have on the park. So I’d have to move it or upgrade at more expense. You could let Haven have the caravan so they could give it to the public over the summer but then that opened the fact that strangers in your caravan could destroy it and steal items. You had to pay for someone to clean it at a big expense, various types of insurance in case the gas leaked or you electrocuted someone, ground rent, standing charges etc. The list went on and on. There seemed to be very little income and too much risk. Of course if you can afford it and don’t see it as an income stream then I’m certain it’s a great way to get away every weekend.

[f

Edited by oldaudi on Monday 20th July 21:44

[Jamescrs]

I've also nearly bought into Haven in the past, i can see why people do it when tou are there on the site and the sun is shinning and you and the family are having a good time. Its easy to get carried away with it all. Thankfully I walked away and did my own sums and realised it was a really bad idea.

I still go.to the site annually but buying into a static is not a good idea financially.

[eliot]

I’ve looked at this and it’s just not economical. You need to rent it out in all the half terms and summer holidays to even cover the ground rent and utilities.
Let alone realise any return on your capital investment.

Look at this, 9 years balance of the lease for 49k
No mention of any additional site fees which I think a few grand a year:
Moor Lane, Croyde, Braunton
https://www.rightmove.co.uk/property-for-sale/prop...

[NRS]

That seems to be a very clear answer for the OP!

[Saleen836]

eliot said:

I’ve looked at this and it’s just not economical. You need to rent it out in all the half terms and summer holidays to even cover the ground rent and utilities.
Let alone realise any return on your capital investment.

Look at this, 9 years balance of the lease for 49k
No mention of any additional site fees which I think a few grand a year:
Moor Lane, Croyde, Braunton
https://www.rightmove.co.uk/property-for-sale/prop...

A quick read on the Parkdean website for the site it is located and it would appear they don't allow caravans to be let out on their site that are older than 10/11 years, I can't see on the listing an age for what is for sale

[Castrol for a knave]

I would buy a narrowboat instead - it will keep its value, much more fun and you can of course move it.

A caravan will depreciate, massively. As others have said, after 15 years it is scrap. Whilst not as aggressive as they used to be, many sites will require you to shift it once it hits year 8 or close.

Not sure where the £900 pm pitch fee comes from - might be the beachside units at the Warrens, but that is not typical. A middle of the road park will be about £2,500 to £3,000 per pitch per annum

It is very tricky letting a van out for holiday hire. Many of the larger corporate parks will not allow it, or if they do, you have to use their booking agency and meet strict criteria and pay 25% commission. Smaller parks might and you can use Hoseasons or whatever, but you're swimming in the mucky end of the market and your £400 a week van will soon be trashed. Plus, lots of competition from other van owners trying to do the same, then lodge owners, then cottage owners - can be a race to the bottom in some sites.

Parks can be ideal for families- safe, plenty of facilities, in nice areas, good community amongst owners, but you have to write off value every year, and you'll never really make it pay with lettings.

[eliot]

Saleen836 said:

eliot said:

I’ve looked at this and it’s just not economical. You need to rent it out in all the half terms and summer holidays to even cover the ground rent and utilities.
Let alone realise any return on your capital investment.

Look at this, 9 years balance of the lease for 49k
No mention of any additional site fees which I think a few grand a year:
Moor Lane, Croyde, Braunton
https://www.rightmove.co.uk/property-for-sale/prop...

A quick read on the Parkdean website for the site it is located and it would appear they don't allow caravans to be let out on their site that are older than 10/11 years, I can't see on the listing an age for what is for sale

I beginning to realise that they essentially get fools to put up the capital and they (parkdean) will rent it out - cherry picking the most profitable dates and lumbering you with all the dead periods and depreciation.
I’ve stayed in one of those vans with the green balcony, never realised it was potentially a privately owned unit

[Castrol for a knave]

eliot said:

Saleen836 said:

eliot said:

I’ve looked at this and it’s just not economical. You need to rent it out in all the half terms and summer holidays to even cover the ground rent and utilities.
Let alone realise any return on your capital investment.

Look at this, 9 years balance of the lease for 49k
No mention of any additional site fees which I think a few grand a year:
Moor Lane, Croyde, Braunton
https://www.rightmove.co.uk/property-for-sale/prop...

A quick read on the Parkdean website for the site it is located and it would appear they don't allow caravans to be let out on their site that are older than 10/11 years, I can't see on the listing an age for what is for sale

I beginning to realise that they essentially get fools to put up the capital and they (parkdean) will rent it out - cherry picking the most profitable dates and lumbering you with all the dead periods and depreciation.
I’ve stayed in one of those vans with the green balcony, never realised it was potentially a privately owned unit

Most of the Parkdean and the big operator stuff is their own hire fleet - that way they control who is on site, what they are paying and the quality of the vans on offer.

Smaller sites, less so.