Real estate investor Pace Morby recently said that he bought a $5 million RV park without putting any cash down and earns $20,000 per month from the property. He used the example to demonstrate the investment opportunity in RV parks and shared how others can capitalize on this under-the-radar asset class.
"The market of RV parks is going to triple over the next 10 years," Morby said on his YouTube channel.
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The Upkeep For RV Parks Is Much Easier Than Multifamily Properties
Morby quickly shared some of the benefits of buying RV parks instead of the more popular multifamily route. This property class can help investors minimize their time on site and save money on various expenses that come up with multifamily and single-family properties.
"I rent dirt," Morby said in the video. "When our tenant leaves, the worst thing we have to do is rake some of the rocks."
Morby then explained that he has single-family homes and had to sink a lot of money into them for repairs, and those investments minimize cash flow. However, RV parks don't require nearly as much maintenance, allowing investors to keep more of their rental income.
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Creative Financing Makes It Easier To Land Deals
Morby discussed how he landed the $5 million deal for an RV park with 85 RV pads, 40 self-storage units, and 20 cabins. It's in Kalispell, Montana, which is close to Glacier National Park.
The seller's broker struggled to sell the property at $5 million for years and tried trimming the price a few times to no avail. However, Morby said that he offered to buy the property at $5 million with seller financing. Morby said that he secured a 4% interest rate on the property and didn't have to put any money down. He didn't go into the specifics about the monthly payments he makes to the seller, but he said that he generates roughly $20,000 in monthly positive cash flow after making payments to the seller and covering operating expenses.
"I'm giving the seller exactly what he wants," Morby said in the video. "In return, he's giving me exactly what I need."
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How Morby Profits From RV Parks
Morby said that he buys multiple RV parks and that you only need one RV park to retire based on the positive cash flow. He encouraged viewers to look for RV parks in desirable locations, as the location of an RV park does most of the selling.
"Location does all of the sales," Morby said in the video. "As long as you get a good RV location, you're going to get a ton of sales and you don't really have to do much beyond that."
Most of his annual revenue comes in July and August, when the Montana RV parks are packed and Morby can raise rent.
Morby also said that the RV park market will triple over the next 10 years. He cited Starlink making Wi-Fi more accessible and the work-from-home trend as two key catalysts for RV parks.
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