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Tight Credit Still Stifles RV/Campground Sales
Posted By Jeff Crider On November 13, 2012 @ 11:08 am In Breaking News | No Comments
Russell Baehre hopes the campground real estate market will pick after this month’s presidential election. “I think after the election there will be a lot of people actively pursuing properties,” he said.
Woodall’s Campground Management reported that Baehre, who has worked as a Kerrville, Texas-based campground real estate broker for over 25 years, said sales always slow down before a presidential election.
And while the recession and tightening credit have slowed the pace of campground sales in recent years, campgrounds, RV parks and resorts are generating interest from investors because of their profitability.
“Our returns are better than other investments,” Baehre said, adding that cash buyers of $1 million parks could see returns of 10% or more on their investment each year, which is much higher than they could get from banks, CDs and other investment vehicles given today’s low interest rates.
“That’s $100,000 in income versus maybe $10,000 on CDs,” Baehre said.
Baehre added that campground occupancies are growing in many areas, fueled not only by travelers, but also by people who live and work in their RVs full time, including oil industry workers, doctors, nurses, accountants and other consultants.
The challenge, however, is convincing banks to lend money on campgrounds, RV parks and resorts.
John Grant, president of Park Brokerage Inc. in San Diego, said most of his transactions involve seller financing.
“Unless the seller is in a position to carry the financing, the property often cannot be sold,” Grant said. “You have people who want to sell and people who want to buy. But it’s hard to find transactions that will work.”
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