Hopefully people don't view my constant 'what about' posts as criticism either. I am very interested in ideas like this and truly would like them to work out so am raising what I see as concerns in the hopes that someone has come up with a solution.
That said, I am following this with interest and could put up $50k if things look like promising. I'm no looking for profits as much as a place to live full time that doesn't cost me anything (ie. extra park business pays the annual costs - at least break even). I'm handy and dependable, but am not looking for a (low net paying) part time job. Helping out with unscheduled maintenance items in the interests of the group is fine. Mowing lawns, cleaning bathrooms and manning the front desk... not for me. Ideally, one could take a year off and rent the spot too... but this isn't necessarily make or break for me.
I saw this as a point of comparison, so I think what's being discussed could potentially work. $37k up front, $600/year:
http://www.rvparkstore.com/rv-lots/1025 ... -bridge-or
Buying an RV park/ERE City/Tiny House Village/Self-sufficient compound w income
If $400k ( 2x $200k) isn't ideal, perhaps you could try to figure out what amount will give optimal flexibility and profit potential. If enough people are interested, with enough money, you could make your $200k only a 25% equity share, but have double voting rights, for example.
Alternatively, there's always the possibility of a business loan. I know you prefer no leverage, but it seems like at least a small loan or line of credit would be ideal for unexpected hiccups.
As far as rent, I'm fine with shareholders paying market rates, but with the caveat that I'd want my share to be capable of financing the rent for one space. There may be some Nasty tax implications for this though, depending on how we set it up
Alternatively, there's always the possibility of a business loan. I know you prefer no leverage, but it seems like at least a small loan or line of credit would be ideal for unexpected hiccups.
As far as rent, I'm fine with shareholders paying market rates, but with the caveat that I'd want my share to be capable of financing the rent for one space. There may be some Nasty tax implications for this though, depending on how we set it up
I think having "everyone" who is living on site pay "rent" $420-$525/month is definitely a way to make it fair for everyone else who are just investing. The only problem I have with this is that it would encourage me to only invest since my current housing costs are only about $300 a month. The other negative is that if the park does poorly, has no customers, then the people living on site would basically be paying the people who are only invested.
Guys, you have to (re)read EAbbey's post on imputed rent (viewtopic.php?t=1430#post-19264) If I own 1/(# of spots) of the park, pay $400/mo for my spot, get $400 in dividends, and pay taxes on those dividends, that is stupid. Obviously, I wouldn't live there for free, but there has to be a tax-advantaged way to do this.
Also, I think we're the sort that will need more space, as DW advocated. Are you cool with a 50 ft steel dragon sculpture that blows fire and eats low-flying airplanes?
Also, I think we're the sort that will need more space, as DW advocated. Are you cool with a 50 ft steel dragon sculpture that blows fire and eats low-flying airplanes?
I'm going to be one of the spoilsports here...at least in Florida and I bet California is the same....We have a State Department of Hotels, Motels, and Restaurants and RV parks fall under it.
The rules and regulations are VERY burdensome and many older parks were forced to close when the state decided that septic tanks were not good enough for RV parks. Choice was hooking up to the local sewer service (if available..and water..cities won't let you just hook up to sewer...you have to buy the water too so well is lost) along with all the piping and impact fees or if sewer wasn't available having to install and run a package plant...cheapest ones started at $250,000 and were very costly to maintain.
The rules and regulations are VERY burdensome and many older parks were forced to close when the state decided that septic tanks were not good enough for RV parks. Choice was hooking up to the local sewer service (if available..and water..cities won't let you just hook up to sewer...you have to buy the water too so well is lost) along with all the piping and impact fees or if sewer wasn't available having to install and run a package plant...cheapest ones started at $250,000 and were very costly to maintain.
@FrugalZen
It would be easier to make a tiny house condo development in most jurisdictions. The trick would be working with a city/county to get your water and wastewater service multipliers down to something appropriate for a 400 sf house. A common multiplier for multi-family is 0.6 of a single family. If you could get it down to 0.3 or something the impact fees and associated development costs for the water and wastewater system would be much lower.
It's almost never cheaper to build and maintain a package treatment plant for wastewater or a well and treatment system for water.
It would be easier to make a tiny house condo development in most jurisdictions. The trick would be working with a city/county to get your water and wastewater service multipliers down to something appropriate for a 400 sf house. A common multiplier for multi-family is 0.6 of a single family. If you could get it down to 0.3 or something the impact fees and associated development costs for the water and wastewater system would be much lower.
It's almost never cheaper to build and maintain a package treatment plant for wastewater or a well and treatment system for water.
I love the idea and could handle upfront costs but simply could not afford the mooted $20-30 per night.
In ten years living on the road I doubt I've spent $500 total in accommodation. I could not afford the lifestyle if I paid to park somewhere.
OK I'm in Australia, maybe it's harder to free camp in the US.
The $20-30 is on par with what I've seen for a similar setup over here (buy-in price was $30k at one point, probably more now), but I've never been there either
Anyway, as I said I love the idea, but one way to retire early is to not spend any more money than you have to, and $5000-10000 a year on camping fees doesn't help.
In ten years living on the road I doubt I've spent $500 total in accommodation. I could not afford the lifestyle if I paid to park somewhere.
OK I'm in Australia, maybe it's harder to free camp in the US.
The $20-30 is on par with what I've seen for a similar setup over here (buy-in price was $30k at one point, probably more now), but I've never been there either
Anyway, as I said I love the idea, but one way to retire early is to not spend any more money than you have to, and $5000-10000 a year on camping fees doesn't help.
-
millionairerednecknextdoor
- Posts: 11
- Joined: Sun Oct 23, 2011 4:29 am
- Contact:
I don't want an additional monthly payment for life for my home like camp site rent. I think more of a co-op, ERE style, would work for me. Non Profit would be even better. Either that or a way to buy a deeded lot, without it being a time share. I want to pay once and be done.
I can't be the only one frustrated with the small house movement city codes.
I can't be the only one frustrated with the small house movement city codes.
The biggest drawbacks I see in the responses to this (including mine) are typically about getting a ROI off of this type of endeavor... as well as/or in addition to making it worth someone's (jacob's) worth while.
What if the focus shifted on N people investing $X to buy a an existing campground, not for income, but for a fixed cost of living. Presumably in a warm climate, and with a small number of lots. I have to imagine, with the right location, you would be limited to property tax and upkeep and taxes on land, septic/sewer, and water. That's really it. (note: I spent 30 seconds searching for this: http://www.resortsinternationalna.com/p ... p?id=22634)
If I could kick in a small sum of money, knowing my only future expenses would be shared taxes as well as septic/sewer issues shared amongst other rational people, I might be more than willing.
What if the focus shifted on N people investing $X to buy a an existing campground, not for income, but for a fixed cost of living. Presumably in a warm climate, and with a small number of lots. I have to imagine, with the right location, you would be limited to property tax and upkeep and taxes on land, septic/sewer, and water. That's really it. (note: I spent 30 seconds searching for this: http://www.resortsinternationalna.com/p ... p?id=22634)
If I could kick in a small sum of money, knowing my only future expenses would be shared taxes as well as septic/sewer issues shared amongst other rational people, I might be more than willing.
-
George the original one
- Posts: 5406
- Joined: Wed Jul 28, 2010 3:28 am
- Location: Wettest corner of Orygun
Just saw this on Craiglist. Didn't call or anything... doubt there is services, otherwise he'd probably say so. Could be knee deep in poo after 6 months.
http://burlington.craigslist.org/apa/2659750221.html
http://burlington.craigslist.org/apa/2659750221.html
Western US, west of the Rocky Mountains, is far easier than eastern US since there are far more public lands available. You do have to uproot every couple of weeks. Biggest difficulty is finding a climate that's comfortable.
Same here, on the coast and in the east it's harder, but with only 22 million people it's easier to get away from the populated areas and once you do that it's pretty straight sailing.
We tend to stay for a month if we find a nice spot.
Climate is less of an issue, most of Aus doesn't get very cold and the top half is warm all year.
Same here, on the coast and in the east it's harder, but with only 22 million people it's easier to get away from the populated areas and once you do that it's pretty straight sailing.
We tend to stay for a month if we find a nice spot.
Climate is less of an issue, most of Aus doesn't get very cold and the top half is warm all year.
I have not read all the replies, but I think this project is quite risky. I sure hope you don't go "all in" Jacob.
In the few posts I read there were many partnership problems mentioned.
My opinion is that partnerships work OK if you:
1. Know and trust the ethics of the people you are going in to partnership with. I'm talking about dealing with people you've personally known for years, not just someone who's been posting on an ERE forum for a year or so.
2. Make sure the partnership is something that is not critical to either entity. For example, our farm went in to partnership with several other farms on a grain bag unloader. This is a $35,000 piece of equipment that has the capacity to unload grain bags for several farms. The agreement is extremely simple. We know and trust the other farmers in the partnership. The administration aspect is extremely low. If things fall apart, each operation has a net worth that could easily swallow the loss of their share of the grain bag unloader without even blinking.
If you ignore the first two rules, to be successful you have to start being like government. Someone has to spend a lot of time in administration, and the other partners may not value the necessity of that work. How do you get compensated for it or are you just doing the partnership a service in order to hold it together?
The one exception is like what Chris says. One entity in the partnership invests all the money and the other person invests all the work. This is what anyone who invests in farmland does. There are tons of qualified farmers so they have little risk if the one doing all the work falls through. They just quickly (could take less than 24 hours) get another farmer if they aren't satisfied.
These types of operations work and work well. Beyond that the complexity is more than I would care to deal with unless I was dealing with someone I personally knew and respected. I hope you seriously consider this before you throw everything you have saved for away. You know better than anyone, anytime you throw all your eggs in one basket you are exponentially increasing your risk.
In the few posts I read there were many partnership problems mentioned.
My opinion is that partnerships work OK if you:
1. Know and trust the ethics of the people you are going in to partnership with. I'm talking about dealing with people you've personally known for years, not just someone who's been posting on an ERE forum for a year or so.
2. Make sure the partnership is something that is not critical to either entity. For example, our farm went in to partnership with several other farms on a grain bag unloader. This is a $35,000 piece of equipment that has the capacity to unload grain bags for several farms. The agreement is extremely simple. We know and trust the other farmers in the partnership. The administration aspect is extremely low. If things fall apart, each operation has a net worth that could easily swallow the loss of their share of the grain bag unloader without even blinking.
If you ignore the first two rules, to be successful you have to start being like government. Someone has to spend a lot of time in administration, and the other partners may not value the necessity of that work. How do you get compensated for it or are you just doing the partnership a service in order to hold it together?
The one exception is like what Chris says. One entity in the partnership invests all the money and the other person invests all the work. This is what anyone who invests in farmland does. There are tons of qualified farmers so they have little risk if the one doing all the work falls through. They just quickly (could take less than 24 hours) get another farmer if they aren't satisfied.
These types of operations work and work well. Beyond that the complexity is more than I would care to deal with unless I was dealing with someone I personally knew and respected. I hope you seriously consider this before you throw everything you have saved for away. You know better than anyone, anytime you throw all your eggs in one basket you are exponentially increasing your risk.