These types of scams (caravans, timeshares, taxi medallion leases, et al) can be grouped as “purchases” on the “never-never plan”. They’re easy to spot from afar, but mesmerizing if you draw too near…
They’re such a fucking scam.
Two family members – one who isn’t good with money and the other in the early stages of dementia – bought a static caravan together. They came to regret it.
The caravan itself was as expensive as a seaside flat (albeit in an area of inexpensive Northumbrian mining towns), except unlike a flat it’s an asset that depreciates massively, like a car, except even worse.
The APR on the loan was 14%.
Gas bottles cost a lot.
You had to have insurance (fair enough), but only through the caravan site’s company (absolutely not fair enough). As you can likely guess, their pricing was dreadful.
The site fees alone were almost £4000 a year, roughly the same as my mortgage on a 3 bedroom house (again, impoverished Northumberland seaside town, so pretty cheap mortgage). When you take into consideration they couldn’t pay that in a lump sum and so also had that as a 14% APR loan in addition to the caravan itself, it cost more than my mortgage for site fees alone.
Once the caravan is 10 years old you have to get rid of it. And you do not get good prices reselling them, because everybody else is trying to sell old static caravans of that age too.
Throughout the whole process, the sales rep tried to obfuscate details, fail to mention things, pretend that fees wouldn’t go up over time (they did, a lot). Not only that, he tried to create a sense of urgency that this had to be done quick otherwise they’d miss out – the same tactic used by phone scammers to force mistakes!
Some liability goes to my auntie of course, but not everyone is good at sifting through and properly understanding financial documents, and these companies know this. They take advantage. They’re every bit as predatory as payday loan companies IMO.
Honestly, it’s absolutely disgusting.
For a time my retired father was looking into buying one, but I’m super glad in retrospect now this has all come out that it didn’t go through and he walked away.
These parks and the individuals who run them are intentionally scamming vulnerable people out of their entire retirement by painting a false picture that these holiday caravans are a sound investment just like owning a house, while all the while knowing fully that people will lose almost everything they put in.
I looked into a static caravan to rent out about ten years ago. Very quickly established, from one of the better operators, that when you add up their fees for this and that there are significant costs. The fine print usually states caravans must be no more than 10 years old and site has first option on buying back. The latter is where you lose a lot of money. As said that was one of the better sites.
