Thoughts on conversion resale prices

[Reddog]

Here is an open question to you folks in the know. It seems that many older conversion buses are real deals in relation to what it takes to start from scratch. Granted, some "conversions" are real money pits just waiting for the next sucker to come along, but some look nice, maybe dated, but nice, and relatively cheap. With the high cost of a newer "bus" type motorhome, why is it that many of these conversions don't bring more than they do?
  Doug Engel, Gunnison, CO

[makemineatwostroke]

Doug, I think its because of finances about all the bus conversions over 10 years old you have to provide your own financing of some type cash or a bank.Over in Mesa AZ the RV dealers sell the 300,000 dollar and up RV with 4 slides for 5% down and 15 or 20 year loans and people buy them because its the easy thing to do and think a 2007 RV has to be better than a 100,000 dollar 20 year old bus.The fuel issue and up keep comes into it also. I have heard sales people tell RV buyers when you buy a bus it will cost you 15,000 per year for up keep and the S&S is not going to cost nothing for 15 years. WRONG that or more is about what their payments will be for 20 years plus the up keep

[Reddog]

Good point on the financing, hadn't really taken that into acount. Funny how many people don't give a second thought about borrowing hunderds of thousands of dollars, but are terrified of spending 100K of savings on someting that will last a lifetime.
Doug Engel, Gunnison, CO

[Christyhicks]

why is it that many of these conversions don't bring more than they do?

Well, there are plenty of busnuts with a lot more experience than we have, but I think there are several reasons for this.  First of all, I think there are some general observations that I've noticed, and a few facts of life.  One of those facts is that it's hard to get financing on even lower priced conversions, especially if they are "non-factory" conversions.  Banks traditionally shy away from anything that doesn't have a bluebook price they can research.  

Then, there is  the difference between "professional" and "home grown" conversions.  Many professional conversions do hold their resale value a bit better than privately done jobs, simply because of the quality of the workmanship.  Sure, we all know of beautifully done private conversions, but for every fantastic one, there are 10 others that just don't measure up in the quality of the components and workmanship.  And then there are another 10 that are worn, outdated, and clearly not well maintained.

Now, before anyone gets offended, we need to remember that many privately converted coaches are done in a manner to meet the needs and expectations of the owner.  Since every owner has specific needs and wants, well, their coach ends up "specific to them".  Often, a potential buyer is planning on redoing much of the interior, so they factor in those costs when deciding how much they are willing to pay.  

Then, there are the numbers of coaches that are in need of major repairs or have been sitting, unused, and finally are dumped for quick sale.  When you see several 25-30 year old conversions selling for less than $10,000, you would hesitate to pay $40,000 for one of the same age, yet people will and do pay that much and quite a bit more for quality conversions.

It's been said, over and over, that you can buy a converted unit for substantially less than converting one, so you can pretty much take that to the bank.  If you can find a unit that meets your needs, you will very likely be ahead of the game buying a converted one.  If you find a quality conversion on a well-maintained coach, well, it's probably worth quite a bit more than the "average" one, and will likely sell for more than the "average" one.  

If you want to convert one with resale in mind, make it generic, make it appeal to most users, use standard, common components, and maybe you'll get a few sheckles more than the "average" coach.  If you want to make a coach that is truly your own, plan on it being that way for a long time. . .get your money's worth out of it yourself.  it's sort of like that old Burger King jingle, "Make it Yooourrrr way" IMHO,  Christy Hicks

[tekebird]

Now that was a good politically correct answer.

example of one of the well maintained preofessionally converted  coaches is the 4108 My folks are selling.

I have no doubt that it is probably the necest cleanest 4108 on the Earth other than the one they bought to replace it that has 78k miles from new.

My personal preference and suggestion to my folks was to keep thiers and sell the 78k mile one......but my dad had a thing for the Super Low Mileage.

It is not hard to make a Conversion that will suit most it just takes some thought...same as building a house on spec (Custom home I am talking not a cookie cutter developement job)

My Folks inquired as to what it would cost to make a copy of the interior in todays dollars of the one for sale.....was in excess of 100k.  Asking price for as close to a factory new condition Platform with a professional conversion is mayny thousands less.

Most do not realize they can take loans out on their investments, retirement and life insurance, besides the traditional bank loan and or home refinance.

My Credit Union has never given me any issues with giving me money to go by Buses....errr motorhomes...no matter the vintage.  Sometimes it might just take some shopping around.  Hell you can get a boat loan for a 30 year old sailboat without a Survey....you just pay a bit more interest.

[tekebird]

Here is another thought:


Building your own you can throw money at it when you have it......buying a converted one requires you to have $X dollars ( or more) every month for the period of the loan.

[akroyaleagle]

GREAT answer Christy!

Most probably don't want to hear what you said but it's the truth. I will stir the pot and take some of the heat off you.

My experience is that I have seen some wonderful home conversions.....but the truth is the majority of them are not very wonderful.

If you do it yourself to the quality of most converters you will have more in it than if you just had it done.

Most of us were not very knowledgeable about all the things we needed to "Do it Right" when we started this thing. If we were, we wouldn't have this board.

There is certainly a place for the home conversion, especially when money is a big issue but they are fooling themselves if they think the resale will approach a quality conversion. Value has nothing to do with money expended. It has to do with appeal.

Not many folks properly maintain their coaches. I have friends that I hate to park near. Their rig throws grease and oil at mine. Great friends but poorly maintained rigs. I have seen these rigs leave huge oil spots on brand new cement pads.

I also sympathize with RV parks that turn some rigs away. Most folks don't want to spend their winter (or summer) getaway parked beside one of these.

A coach is no different than a house, it needs updating occasionally. Remember when shag carpet and pastel colored appliances were the rage? Try to sell a house with that decor today.

Now to financing. My thoughts are that if you need it, you are going to be needing more to rectify the things that were missrepresented to you when you bought the coach.

This is certainly a buyer beware market. Do not sell your home and sink your savings into a RV. If you have not tried the lifestyle you may not like it and are stuck with a pink elephant. Buy or rent something cheap for a season and see if you like it. We have met many folks that sold everything to "Live out their dreams" only to discover after a few months that he missed his shop or she missed her things or they both missed the Grandkids etc.

After 12 years of living our dream we have done a total remodel on one of our homes and sold everything else. We like having a home base so we can have all the things we grew to miss. We still have our coach and I plan to die with it. But it will be a properly maintained and up to date coach even then.

[Jerry Liebler]

The thought that occurs to me is:  With almost no exceptions the well done DIY conversions are not for sale.  What is on the market are often full of workmanship that is far below the minimum standards of the cheapest S & S.  When shopping for mine I looked at dozens which I passed over because stripping out the crap, and repairing the damage done, would have been much more work than starting from a seated coach.  I've seen a few really well done DIY conversions, at rallies, they are simply not for sale, but they were every bit as well done as a Marathon Prevost conversion and probably would get comarable prices.
Regards
Jerry 4107 1120 

[makemineatwostroke]

I was told years ago buy a gentleman that manufactured RVs that if you bought a high end bus conversion or a high end motor home like he manufactured and thought of it as a asset you were wrong they are a liability not an asset. His name was Mr.Fore of Foretravel a very honeset man

[ChuckMC9]

If you want to convert one with resale in mind, make it generic, make it appeal to most users, use standard, common components, and maybe you'll get a few sheckles more than the "average" coach.

And I'll say, at the most certain risk of being soundly trounced, that if you convert one with resale in mind, you're crazy, or you're watching too much Fox news. Fuhgettaboutit. Everything's gonna change in the next 10 years and things will *not* be like they've ever been.

[Lin]

I think that not having a book value which means no financing, and a crap shoot on quality/safety in construction reduce the value of conversions quite a bit.  Just to get mine insured  beyond simple liability, required and independent appraisal.  The MC-5a I just bought was theoretically professionally convert, but it was a while ago and that does not mean that short cuts were not taken.  One must remember that manufactured motorhomes are not all bad.  Many just start with an inferior platform, but the execution from there on could be good.  We all know that the shell is not the biggest expense, but can undermine the value of everything done to it.  Although RV dealers are not honest when talking about conversions and upkeep, they are right to say that it is more of an issue than with standard RV's.  Many of us would be lost without sites like this one and would be learning as we go through trial and error--mostly error.  Buses at least take some serious awareness of maintenance issues.  Ignorance or neglect can be catastrophic.  This is true of RV's too, but since they are more closely related to cars/trucks, and there are people all over to work on them, that is less of a problem.  RV owners do not spend time researching where to find the correct oil.  The brakes on my MC-5a have serious issues, not major, but serious none-the-less.  I have someone else working on them.  In pulling out a bunch or old air hoses that look like they should be changed, it was found that most of the ferrels were installed backwards.  This is not catastrophic, it just makes for more air leaks, but given that info, I must assume that there are other places where similar expertise was employed in repairs.  I believe I paid a price that left me room to find things like this and fix them.  However, even though it may have seemed that the price was a fantastic bargain, it is clear that as the bus gets what is needed, it will be worth about what I paid.

It is true that one could luck out and get one that was converted well and maintained well at a bargain price, but there is no guarantee of that.  Since each conversion is unique, there are no manuals on the systems.  One must explore and learn.  Some of the things I came across clearly seem stupidly executed, but that's okay since it was built into the price.  I believe that the price must reflect the risk involved.  I have watched ebay and seen machines that clearly have in excess of $100K invested in them selling for below $40K.  In some cases, I spoke to the owner/converter who really seemed to know his game which could give one a feeling that they did it right.  If you find one like that, it may be worth paying more for.  But just because someone spent a lot of money and time on it doesn't mean much.  You may end up spending as much money and time undoing what they did.  All that said, if you are interested in buying an already converted bus, look for one that has, or has room for the features you want, get it checked out as best you can, pay a price that will allow to absorb some surprises, and remember that you are not likely to get back what you put into it.   But really that's true of just about everything we buy except for the Van Gogh in the kitchen once you touch it up a bit.

[Reddog]

One thing that I have come to think here recently as a mechanic/service station operator is that we (I'm 48) and those older than us (with exceptions going out to those younger than I who work hard and are capable at many things) is that there are fewer and fewer folks who want to work. Not only that, but they have very few talents that have to do with working with their hands. I believe if you took a survey of how many 20 Y.O. males can change their flat tire or check their oil, you would be amazed at how few can do those simple tasks. (Maybe the females would fare better, but I think they would come out in a dead tie.) Does this enter into the equation? Do potential buyers see conversions as maintenance nightmares? I certainly limits the number of DIY converters today and in the upcoming future.  A few have already pointed out how there are lots of conversions out there that have not been done well, those rigs may be problem prone. I will be the first to say to a potential bus buyer that if you can't do alot of the work yourself, maybe a conversion bus isn't for you, but that's just how I think.
  When I decided to build our bus, I wanted something that you could not go buy off of a lot. Our bus is definitely done in a style that is not "mainstream", so I will have a limited market if we were to sell, but do have more mass appeal. I just don't get it how many (thousands and thousands actually) will pass up a good conversion, at a lower price, to go buy a S&S rig. I think it's also related to the instant gratification thing.
  To each their own I suppose.
Doug Engel, Gunnison,CO

[oldmansax]

The thought that occurs to me is:  With almost no exceptions the well done DIY conversions are not for sale.

Probably the exception to this rule would be the owner that wants to sell because of health problems, a change in personal life (spouse passed away for example), or has decided they are too old to drive a bus around any more.

We were very fortunate to find such a deal. Our coach already had everything we needed and most of the stuff we wanted. It's not "professionally" done but well done and well maintained. The PO wanted a smaller (35ft) coach so they could camp in all the state and federal parks. We got a super deal on a very nice coach. Of course, we looked around for 5 years before we found this one and had to pay cash.

There are some deals around, but you HAVE to do your homework.

TOM 

[ChuckMC9]

there are fewer and fewer folks who want to work. Not only that, but they have very few talents that have to do with working with their hands.

Boy, you're right about that, Doug. Did you know that Soap Box Derbys all come in a KIT now? Few potential contestants had the space, tools or knowledge to build it themselves anymore. In order to keep it alive, they had to start doing all the work for the contestants, so that all each one has to do is follow instructions and put it together.

[Christyhicks]

The OTHER exception to the rule is like an earlier poster mentioned, when someone upgrades to a nicer conversion.  We had no intention of buying a converted bus, as we were just starting a conversion ourselves, until we looked at TempBus.  The quality of the conversion and the components installed convinced us that the bus was worth the asking price.  When we get BigBus done, TempBus will go up for sale. . .we don't expect to get everything we stuck into it back out of course, and we'll disclose everything we can think of, but the truth is, it's still a 40 year old bus and we're not going to put a guarantee on it.  

We feel like we got a pretty good deal on TempBus.  Sure, we've done some upgrades and a few repairs, but it would be illogical for anyone to purchase a converted bus for less than a couple of hundred thousand dollars and expect to avoid repairs.  On this and other forums, I constantly read about situations where the new owner gripes and gripes about this that crop up after they purchase a unit, and they feel like they were mislead.  

Now, we know there are indeed some situations where people were grossly mislead, but I feel that the majority of complaints against sellers are unwarranted.  Our bus wasn't perfect, hmmmm, didn't expect it to be. . .it's, what, 40 years old?  It's going to have a few problems here and there, this relay or that one may act up, electrical connections are going to be corroded, etc.  When something acts up, we fix it.  If you are buying a $25,000, or even $40,000 conversion and you think it should be perfect, you're not be realistic.  If you purchase a $8,000-$15,000 conversion and it doesn't have quite a few issues, you're just lucky as crap.  If you spend $15,000 on a converted bus and later find problems, well, what in the world did you expect for $15,000??  You can't buy a nice, trouble-free stick and staple for that!  

Most buyers have the opportunity to thoroughly inspect a bus they are buying, they can drive it, they can climb around and inspect it, try out all of the components, etc.,  and if they choose to pass up that opportunity, well, they only have themselves to blame.  The seller is not going to necessarily know that the air pump is getting ready to go out, or that the transmission has only 1,000 miles left in it, or that a brake pod is going to blow out.  Heck, how many people on this board alone has had something go out suddenly on their bus. . . if they knew it was going to happen, they would have done the repairs at their own convenience.  To me, a $10,000 bus conversion is about like a $500 car. . . you're getting it cheap, don't expect too much.  If you luck out and get a great deal, well, cool for you, consider yourself blessed.  If you end up with a unit that needs a heck of a lot of TLC and some pretty major repairs, well, again, WHAT DID YOU EXPECT??? ha ha  

I agree with the comments about fewer and fewer people working with their hands these days, but I think that's just how things go.  Although Larry and I both have hobbies requiring us to build things ourselves, the truth is, I don't have near the survival skills that people did years ago.  I couldn't smelt a nail or horseshoe if my life depended on it. . thank goodness it doesn't.  I can pound in a t-post pretty well, but I sure wouldn't relish the thought of chiseling my own fence posts!   I can sew pretty doggone well with a sewing machine, but I'd rather not knit a sweater, and I sure wouldn't choose to make my own thread or card any wool!   Oh well, guess that's enough of my thoughts for now. . .way too much I imagine.   Christy Hicks