March 13, 2018

RV Rental Business | How to Generate Passive Income Using an RV

Episode 176:

RV Rental Business | How to Generate Passive Income Using an RV

Ryan Enk is a small business owner, entrepreneur, and successful real estate investor. He lives in Louisiana with his wife and 5 boys. The purpose of this blog is to help others learn how to pursue “Return To Life” Investing. RTL investing.

What you’ll learn about in this episode:

  • Why RVs are a great opportunity to create a very quick producing, high cash flow business even if you have no money or no credit
  • Owner financing: why 25% of the market is willing to owner finance their RV
  • What causes RV owners to be willing to sell their RVs so cheaply
  • Ryan’s rolling real estate formula you can use to start your own real estate business
  • The screening process for deciding if someone should be able to rent an RV or not
  • Why renter damage isn’t really a problem even for the most profitable people in this industry
  • How Ryan is able to make over $100,000 a year on just five units
  • The RV ROI calculator: a game-changing tool for determining how much can be made with RVs
  • The rolling real estate six-figure society: the $1,000 giveaways Ryan gives his students monthly when they complete certain tasks
  • Some of the added benefits of an RV rental business

Resources:

Transcript:

Mitch Stephen: This is Mitch and welcome to the Real Estate Investors Summit Podcast.

I’ve got Ryan Enk on the line and he is going to talk to us about, get this, how to make money from your idle RVs. How to make money from RVs by renting them out by the day, or the night, or the week, and I’d like to introduce him right now.

Ryan, how you doing?

Ryan Enk: Doing great. Doing great. Thanks for having me.

Mitch Stephen: Oh, well, tell me a little bit about your background. How did you get to this point?

Let’s kinda do the abbreviated version because I want to spend a lot of time on actually the business because it’s so intriguing. But, give us a little bit about your background. How’d you get here?

Ryan Enk: Well, yeah, I actually, I’ll keep it as short as possible, but I live in the New Orleans area during Hurricane Katrina, me and my wife, who’s eight-months pregnant, kind of lost everything, and at that point I set on this journey to try to make passive income, because I couldn’t get a job. Nobody would hire me.

So, I decided-

Mitch Stephen: Why wouldn’t they hire you? [crosstalk 00:01:32] Why wouldn’t they hire you?

Ryan Enk: I don’t know, something about my face. I’m not sure. I don’t know why, you know. Yeah, I was scratching my head trying to figure that out for a very long time, but I kind of had this chip on my shoulder and I decided to start pursuing owning my own businesses and making my own investments to try to achieve enough passive income to make my family float.

So, I’ve got a family of five, five boys.  I don’t really know how to make girls, yet.  But, I’m not a quitter.

Mitch Stephen: I like you. I like you, Ryan. So, let me ask you this.

Ryan Enk: Yeah.

Mitch Stephen: Did you have a real estate background or what were you doing before you lost everything?

Ryan Enk: Well, I did actually. I did pretty much everything there is to do in real estate.

I was a realtor at the time that the hurricane hit and it was kinda, in real estate, and I’m sure you understand the same sentiment, there’s these things that come and go and it depends on how many people are doing that at the time.

So, I was a real estate agent then everybody wanted to be a real estate agent. That market kind of became a red ocean where all the sharks were feeding in that one place, and then I did foreclosures and I did pre-foreclosures.  I did buy and hold.  I did wholesaling.  I did flips.

So, I did pretty much everything there is to do in real estate and what kind of transitioned me into the rolling real estate formula is that I started doing short-term rentals, you know these vacation rentals where you could get in and get a lot more cash flow by renting to the Airbnbs and whatnot, and we had finally made enough money to where my wife said, “Hey, now that we’re not broke, why don’t we take an RV trip this summer?”, and so, I went to look for RVs to rent and I looked at the pricing and of course, the entrepreneurial side of me.

I started looking at and crunching numbers and I’m like, “Wait a minute, what if took my system for the short term rentals,” which was completely passive by the way.  I set everything up, property managers, offsite booking services. So, it was, I just saw the money coming into my bank account every month.

So, I said, “What if I took that same system, tweaked it a little bit and applied it to RVs?”, and that’s how I came up with The Rolling Real Estate Formula.

Mitch Stephen: Wow, incredible. I was under the wrong impression here. I thought you were renting the RVs as they sat still just for people to spend the night in. But, you’re talking about renting them to roll down the road, which is the stuff I’m very interested in myself because I want to take one of those RV vacations.

Very interesting. I may be one of your customers.

Ryan Enk: Yeah.

Mitch Stephen: Okay. So, I’d love to learn how to get that done and take my vacation, but that’s another conversation for another time.

Let’s talk about how you develop this business, but first I want to get a word from my sponsors then we’re gonna learn how you’re making money rolling real estate down the road and renting RVs to people who wanna take trips.

Stay tuned, we’ll be right back after a word from these two sponsors. Thank you.

Mitch Stephen: All right, listen up boys and girls.

Have you tried skip tracing before, but gave up in frustration?

I do understand. There are a lot of skip tracing providers out there, but none of them are really helping to educate you on how to efficiently and effectively use the invaluable information you can get your hands on, but I have some good news for you.

I want you to go to reinvestorsummit.com/skiptrace and let my friends there help you solve this problem.

They are not only a provider of great skip tracing information, including phone numbers and all kinds of information, but they’ll also help you understand the different techniques and strategies to use and get the most out of that data.

Let’s face it. You can have all the data in the world, you can have the best data in the world, but if you don’t know how to use it, it’s useless, and let me tell you this, if you’re not skip tracing, you’re missing out on a ton of great deals, the best deals in the business.

So, go to reinvestorsummit.com/skiptrace and learn from this one-of-a-kind service and get started finding those deals that no one else can find, reinvestorsummit.com/skiptrace.

Mitch Stephen: What if you could capture the phone number of every person who ever called your company? What if you could track the success or failure of every advertisement, effectively and affordably, and then imagine being able to text all those prospects, pay just pennies to reach the entire group?  

Go to livecomm.com. That’s livecomm.com and watch the four-minute video on the homepage. Other mass texting companies want to charge you five cents per person on the list. At 5,000 people, that $250 per text. Who can afford that?

With LiveComm, you can text 5,000 prospects for under nine cents total. LiveComm has so many features it’s impossible to tell you about them all here.

Contact livecomm.com today. Mass texting done right. Mass texting you can afford.

Mitch Stephen: All right, I’m back with Ryan Ank and we’re learning about how to make money with rolling real estate.

So, you know you guys, he’s got some things to give away. If you’re coming and going, make sure you write down reinvestorsummit.com/rv. He’s got some interesting giveaways and some interesting propositions for you that we’ll get to in a minute here.

But, let’s learn more about how you developed this system, Ryan. How did you go from zero and how did this idea become a business?

Ryan Enk: Well, yeah, so what happened was as soon as I started looking at those rental prices and I applied the same system that was from my short-term rentals to RVs what I discovered is you could get into these things for no money down.

So, this is not just for people who already have RVs. This is for someone who wants to start a very quickly producing, high cash flow business even if you’ve got no money and even if you’ve got no credit.

So, you can, I say, you might agree with me, the real estate market if you’re looking at the motivated sellers and ways that you can get things owner financed and things for no money down. I’d say it’s about less than 5% of the real estate market.

With RVs, it’s probably about 20, now there’s not a whole lot of data out there, but in my experience, it’s about 25% of the market is willing to owner finance their RV to you and often time with no money down.

So, it’s a great strategy if you’re looking to build a high cash flow, passive income business. You can go to six figures real quick. Just basically by using other people’s RVs and by acquiring RVs with no money down.

Mitch Stephen: Well Ryan, I think you just might be able to coin a new moniker here. The OPRV, O, you know there’s OPM and then there’s OPRV. So, you’re gonna get rich in this scenario using other people’s RVs, and let me make a run at why people will owner-finance you their RV with no money down.

Just let me make a run at, you tell me if I’m correct. I’m guessing here, but this-

Ryan Enk: Sure.

Mitch Stephen: My instinct.  These people have a lot of money or it could be a lot of them have a lot of money, and these things are sitting around doing nothing.

They lose a lot of value when they just roll off the lot and if they have any wear and tear on them at all they’ve lost more value. They may even be upside-down in most cases on these RVs.

So, they’re saying, “Hey, here’s one way to compensate or to at least get my price or get some interest on my money and not have to write a check at this sale.”

Am I right so far?

Ryan Enk: Well, no. You’re exactly correct. In fact, that’s what I tell people because there’s so many opportunities out there. People say all the time, “Hey, well what’s wrong with these things? I mean, why are so many people willing to give these away?”  

Baby boomer-type people, they bought a nice RV and they were gonna travel the world and then it’s hurting them now, and it’s just sitting there in storage.

They say that the average RV only goes out four times a year. So, at a certain point, maybe they own it for two or three years, they get bored with it, you know and his wife’s saying, “Jack, you got to get rid of that thing. We’re paying storage fees, and we never use it anymore. You can’t get out like you used to,” and that’s the exact kind of scenario that makes it an opportunity.

So, they just say, “Whatever, I’ll put it up there. Take over my note. Whatever it takes.”

Mitch Stephen: Let me chime in here. I have RVs in boat storages and I have RVs in boats on trailers that the tires have brought it off of, of the trailers and of the RVs. There just sitting in my storages. They can’t even roll anymore because that’s how long they have not moved.

Ryan Enk: Right.

Mitch Stephen: So, I’m there to like validate what you’re saying because I live it in my life.

You know, there’s a saying, “If it flies, floats or faces the ocean, you should rent it.” So, I’m gonna add, “If it rolls, flies, floats or faces the ocean, you should rent it.”

Ryan Enk: Exactly. That’s exactly it, yeah. Absolutely.

Mitch Stephen: And you know, I’ve been tempted as a guy whose had some success to go buy an RV myself and want to do that, and there’s this thing inside of me that keeps saying, “Don’t buy it. Just rent it,” and this is the other thing I wanted to say about why you could get these RVs at zero down and the sellers would finance them to you, is because the romance wears off of it pretty quick.

I mean, you take a couple of trips, it really fun, and then okay, we’ll I’ve done that now and I’ve still got this RV that I’ve got this payment on and the storage facility taking money out of my pocket.

You know, it was the same thing with like when I see people buy jet skis. They’re really good at it for about the first month of the summer. They’re out there all the time and after that, they don’t seem to get used anymore. You know, we should have all just rented those toys or those boats or those kind of things, and I think this is a perfect idea.

So, am I right about that? People take a few trips and they’re real excited for the first six months and then after that they’re done, but that payment didn’t end in six months.

Ryan Enk: Yeah, well absolutely. Yeah, the luster wears off or you already went to your bucket list destination. You can only do that so much and then you kind of move on to the next toy.

They say that about 12 million people per year look to rent RVs, but right now there’s only 1000 RV rental dealers out there. So, the peer-to-peer marketplace really opens up this opportunity right now to make this a great investment.

Mitch Stephen: So, don’t let me get ahead of the conversation here, but my next thought is like if I want to rent a RV, what do I have to go through with you? I mean, do I have to have a commercial license? How difficult is it to find someone who’s, that you feel safe in renting a RV to?

Ryan Enk: So, is your question, “If I want to rent out the RV, do I have to have a commercial license in order to do it?” Or is it-

Mitch Stephen: No.

Ryan Enk: Or is it, “If I’m a customer and I want to rent it out?”

Mitch Stephen: If I’m a customer and I want to rent an RV, do I have to a CDL or some kind of commercial license to drive it?

Ryan Enk: No, that’s the thing. You don’t need any kind of license to drive an RV.

Mitch Stephen: Okay. And then-

Ryan Enk: [crosstalk 00:13:03]

Mitch Stephen: How do you qualify these people? How do you know, it seems like you’re taking kind of a big chance, these RVs. What’s the average cost of an RV that you rent out? What does it cost you?

Ryan Enk: Oh, I’d say they range between $40,000 and $120,000. They are kind of a broad range, and it depends on the type of RV. You know, there’s travel trailers, which are like $20,000. Then there’s the Class Cs that are like 40 to 60 and then you got your class As that are 60 to 120.

Mitch Stephen: So may I ask, how many units do you have that you’re attempting to rent every day?

Ryan Enk: Right now we have five units.

Mitch Stephen: Okay, and what kind of units are they? Are they all over the spectrum that you’re talking about or are they pretty much in one area?

Ryan Enk: Yeah, I’ve got a class A. I’ve got some class Cs and I’ve got some travel trailers, and they all do pretty well.

Mitch Stephen: Okay. So, how do you qualify the people? Or, is it tough to qualify them or what are you looking for when someone says, “Hey, I want to rent the RV.”

You’ve got to turn some people down, don’t you?

Ryan Enk: Well yeah, certainly, and that’s what I cover in The Rolling Real Estate Formula. There’s a certain level of screening that you want to go through.

Your first level of screening is the kind of marketing that you’re doing. You know, you can target people specifically on Facebook for example that have an income above a certain level, within certain demographics, certain ages, and you want to make sure you’re raising prices during certain events that go on.

Like here we’ve got New Orleans. We want to raise our prices for Mardi Gras and you know as well as that, we do a driver’s license check and everybody get insured and you know one of the greatest levels of screening is that we charge a $1500 deposit, damage deposit, and nobody really wants to lose $1500.

So, that kind of eliminates some of the bad people that might rent them out because right out of the gate they’re going to have to put up $1500 in order to rent it out and they know they’ll lose that if gets damaged.

Mitch Stephen: Well that makes perfect sense. You’re dealing in a certain caliber of person and even if there was damage over $1500, you know they backed into a tree or something, they have the money and they have the insurance to pay for it. You know, they can pay the deductible.

Ryan Enk: Exactly.

Mitch Stephen: You know. A lot of people that are successful, they got there by honoring their word and doing the right thing and if they do something that costs your company some money, they you know, they’re stand up people who come up and say, “You know, hey, made a mistake. Cut that turn a little too short, hit the fire hydrant. Here you go. What do I owe you?”

Ryan Enk: Exactly.

Mitch Stephen: “How do we get this resolved?” You know.

Ryan Enk: Right. Right.

Mitch Stephen: So, tell me about-

Ryan Enk: And we do, we have a-

Mitch Stephen: Go ahead. Go ahead.

Ryan Enk: Yeah, we have certain processes that definitely eliminate that potential. That’s one of the main questions that people ask. “Well, what about renter damage?”

You know, I interviewed all the top RV rental producers in the US, people making well over six figures doing it, and it all came down to six basic things that we talk about in The Rolling Real Estate Formula and these guys have little to no problems with damaging the RV. It just comes down to screening and training and a couple of other things, but yeah you kind of mitigate your risk by knowing what you’re doing.

Mitch Stephen: Let’s get personal here and Ryan, if it’s too close to home, whatever, you just let me know, but so when you’ve got five units, what are you making using these five units? How often are they rented? How lucrative is it with just five units? I mean five units doesn’t seem like a lot. What can a person do with just five units?

Ryan Enk: Well, with five units we make well over $100,000 per year.

Mitch Stephen: Wow. Wow. That’s a business to pay attention to. So, you’ve got some giveaways for the listeners here.

You’ve got the RV ROI calculator. I guess a way to calculate what your rate of return is gonna be on this particular kind of investment vehicle, literally, investment vehicle.

Ryan Enk: Yes.

Mitch Stephen: And, you also have a club or society, The Rolling Real Estate Six Figure Society, where you do some interesting teaching and methods here.

Can you talk to us a little bit about The Rolling Real Estate Six Figure Society and how it works?

Ryan Enk: Oh sure, yeah. What it is, is I wanted to give my students extra motivation, if quitting your job isn’t motivation enough, but I wanted to give my students extra motivation to accomplish some of the milestones in the course.

So, every month we do a $1000 giveaway for somebody who accomplishes the milestone, and for example this month we are giving away $1000 to the first person who buys an RV with no money down and I give them all the steps on how to do it and I guide them through it. If they have any questions, if they run into any roadblocks or barriers, I’m there online on the forum helping them through the process.

So, once a month we do this with a $1000 giveaway and when someone accomplishes it, they get $1000 from me in their PayPal account. So, that is a really cool thing that we offer and it’s normally $39.99 a month and if you sign up within a certain time frame that this podcast is published, then you’ll be able to get that Rolling Real Estate Six Figure Society Membership for free.

Mitch Stephen: Okay, so let me make this clear to the listeners. You know, this podcast is recorded and it’s archived and you may be listening to it weeks after it was posted. I don’t know when you’re listening to it, but suffice to say Ryan has the choice and he certainly has the right to change this offer anytime he wants to, but if you’ll call him when you hear this if you’re interested and see if he’s still gonna waive the $39 per month to join The Rolling Real Estate Six Figure Society where you got some first class help there.

Also, can you tell us a little bit about the RV ROI calculator? What is that about?

Ryan Enk: Yeah, what it is when I started going through and analyzing every single deal and trying to figure out whether or not a certain RV would be profitable, there’s a couple of different numbers that you have to crunch that I teach you on how to do and I, what I did is I got tired of crunching those number and writing them down on napkins and what not.

So, I came up with this really cool RV ROI calculator, and I have my students email me all the time and say, “Wow, this thing was such a game changer for me. It really helped me in figuring out how much I can make and how to really analyze certain deals to make sure that they’re profitable.”

So, that is another thing that I give away.

Mitch Stephen: So, there’s some extra factors when you’re dealing with RVs that you need to plug into this formula to come out with some data you need to know. So, it’s tailor made for RV rental use, and it’s also free if you go to reinvestorsummit.com/rv and there’ll also be some contact numbers in there and Ryan’s website or whatever he has that he wants to put in there.

By the way Ryan, it’s evergreen if you come up with a different something different, or you have a speaking engagement and want to post it, it’s evergreen. You just have your people call my people and they’ll get it up there and you can keep this thing evergreen if you want.

All right?

Ryan Enk: Perfect.

Mitch Stephen: Okay. So, I’ve kind of taken over the conversation here and I have a bad habit of doing that so I’m gonna back up and just kind of give you the floor.

Is there anything you wanted to say or talk about that I just took us off down a rabbit hole somewhere? I’m gonna come back up and turn it over to you.

What, like I’m interested also in like some of the greatest experiences and in the name of transparency, what’s your worst experience, you know? Something like that.

Ryan Enk: That’s actually a funny story, the worst experience, but you know, the greatest experiences are to be able to set up this entire system and make it a, just a passive income, cash flowing business that’s all automated.

I know that a lot of people want to have financial freedom and that’s where I was back during that hurricane time and you know, struggling to provide for my family with five kids and so that’s probably the greatest experience is that this is an investment that you can have a very high cash flow on, and the plus side of that is that you get to use it when nobody else is renting it.

So, my family, we took it out to the Grand Canyon, the Grand Tetons, we took it to the Smokey Mountains, to the beach and then we went and I started teaching other people how to do this.

In fact, one of my students last year made $270,000 in passive income on renting out RVs in Michigan, in the Michigan area. So, that is definitely one of the most awesome things about this is that is allows you to have this freedom in your life. You know, the quit your job kind of money and it’s one of the, like I said, I did a lot of stuff in real estate. It’s one of the fastest things that you can do right now to create passive income to replace your working income.

Funny story, one of the worst experiences was just through my process of learning how to screen renters and learning how to do certain things like label your RV. These are all things we cover in the course, but I had a renter take it up to the Smokey Mountains and he drove it under a bridge, and that’s because I didn’t have labels on the front what the height of the RV was and the bridge was a little lower.

So, it knocked the AC unit off the bridge, cracked the ceiling and the funny part about that is he showed up during the arrival with his zipper down and wanted a discount because the AC didn’t work on his trip.  Yeah, it was unbelievable.

You know, the cool thing about it is that insurance covered everything. I didn’t come out of pocket, but it was a huge lesson learned on how to screen renters and it was the only thing that was my risk was that I had a little down time while it was being repaired.

But, it was, you know-

Mitch Stephen: But, that’s how-

Ryan Enk: One of those things you learn from.

Mitch Stephen: That’s how you learn and that’s why you want, people need to go to you or at least, I’m always telling people, “Pick someone who’s done what you want to do and go talk to them first. They could save you from these problems.”  You just never think about some of these things until they happen to you and then you start putting in, I don’t know, systems or catchalls that help solve that issue.

So that’s one of the reasons, if you’re interested in this business, please get a hold of Ryan over at reinvestorsummit.com/rv and don’t learn this stuff the hard way.

Then I want to say this, and this is a, I don’t know, it’s what R E Investor Summit Podcast is all about, you know. It’s usually about real estate. It’s always about cash flow and financial independence. Creative real estate can be a pretty thin slice of pie as the world goes and I don’t really care what you guys out there do to get free.

I’m trying to help you with all these different ideas to get free. Pick one and win at it, you know. This one doesn’t have to do with real estate, but it does have to do with cash flow and finding your own financial independence.

So, in my podcast I try to cover creative real estate, entrepreneurialism, motivation and inspiration. That’s the four categories, that if you fit into one of those four categories, I’d like to have you on this podcast.

This one falls under certainly entrepreneuralism and probably inspiration because I think it is very inspirational Ryan that you found this kind of a niche. I think it’s a wonderful niche and somewhere out there you’re gonna change, someone who’s listening to this podcast, you’re gonna change their life and that’s what this podcast is about.

Ryan Enk: Thanks, Mitch.

You know, that’s one of the things they say is that, “The riches are in the niches,” and that’s kind of some of the ways that’s I’ve been able to get financially free is by finding those niches as they are in demand exploring them.

Mitch Stephen: All right, my friend.

Anything else we need to know maybe before we wrap it up? Or, I can give you the floor. If you’ve got more to talk about this topic, we’ve got plenty of time.

Ryan Enk: I think that’s good. I think we’ve covered all bases.

Mitch Stephen: All right, so you guys, I want you to go to reinvestorsummit.com/rv. I want you to get your RV ROI calculator. Check it out and also, pay attention to The Rolling Real Estate Six Figure Society if you are really interested in this.

If you call, you know call as soon as you can and perhaps Ryan will still be waiving that $39 per month fee and you can get involved in The Rolling Real Estate Six Figure Society program there.

Ryan, it’s been my pleasure to have you.

Ryan Enk: Thanks, Mitch. My pleasure as well.

Mitch Stephen: All right, this is Mitch Stephen with The Real Estate Investor Summit Podcast.

I am so glad that you stopped by to get ya some Ryan Enk and learn about rolling real estate and learning about how to profit off of RVs.

All right, I hope you have a great week, a great month. I hope you achieve your goals for the year.

This is Mitch Stephen and we’re out of here.

Announcer: You’ve been listening to the owner financing master, Mitch “Be the Bank” Stephen, on the Real Estate Investor Summit Podcast.

Let us now blatantly, without apology, drive you towards financial freedom by offering you a whole bunch of free stuff.

Go to reinvestorsummit.com and get you some. And, y’all come back now, ya hear.