I was told by one broker that Katrina really put a dent in the used boat market. They said that too many boats were damaged and there were not enough estimators to quote and repair. Lots of boats were totalled with minimal damage., Just gotta find them i guess??
Just how bad is the boat market?
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Pascal,
Boat value is always based on what someone thinks its worth - seller and buyer. There are more boats than buyers, so if someone wants to hold on for what they think it is worth, their boat, their choice.
As a seller, it is not totally unreasonable or illogical to assume that if you bought a boat for a price you felt was a good deal based on old equipment, poor condition etc and you went through extensive upgrades, it should be worth more than what you paid for it. I'm not saying that you should recoup your total investment, but there is some value that you consider it to be worth if you were looking for it today.
In my mind, the trick is to be realistic. The market is not the same, fuel prices are putting the ongoing cost out of reach for many etc. As I said, I have no regrets. I loved every minute (almost) and it served me well.
As Gary said, I'm in the situation of already owning another boat. I feel like I got a great deal on my purchase and that softens the blow on the sale. Luckily, I don't need to sell this one to pay my bills, but I'm happy to not have the worry. Now someone else has a great deal and can enjoy it going forward.
Boat value is always based on what someone thinks its worth - seller and buyer. There are more boats than buyers, so if someone wants to hold on for what they think it is worth, their boat, their choice.
As a seller, it is not totally unreasonable or illogical to assume that if you bought a boat for a price you felt was a good deal based on old equipment, poor condition etc and you went through extensive upgrades, it should be worth more than what you paid for it. I'm not saying that you should recoup your total investment, but there is some value that you consider it to be worth if you were looking for it today.
In my mind, the trick is to be realistic. The market is not the same, fuel prices are putting the ongoing cost out of reach for many etc. As I said, I have no regrets. I loved every minute (almost) and it served me well.
As Gary said, I'm in the situation of already owning another boat. I feel like I got a great deal on my purchase and that softens the blow on the sale. Luckily, I don't need to sell this one to pay my bills, but I'm happy to not have the worry. Now someone else has a great deal and can enjoy it going forward.
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J- sent you an email.
Just had 2 new yachts show up in our marina, one I would guess the value to be at least 750,000 with out equipment, the other must be around 1.5 to 7 mil.
As long as people have money, they will spend it doing what they enjoy doing
As long as people have money, they will spend it doing what they enjoy doing
I have been in the market for over three months looking for a used flybridge 35' to 40' and I have made so far two offers at NADA value that have been turned down. Both sellers, who also purchased the boats used, only had the boats for a couple of years and they didn't want to lose any money. The reason I want to buy at NADA value is that when I will resell I want to offer the boat at a very attractive price so I don't have to wait for ever to find a buyer. Times have changed from three or four years ago.
As an example, if the NADA value is at $100,000, no way they are going to get $150,000 for that boat unless they find someone with money to burn and in that case this someone would go directly to a new boat dealer.
As an example, if the NADA value is at $100,000, no way they are going to get $150,000 for that boat unless they find someone with money to burn and in that case this someone would go directly to a new boat dealer.
The old saying goes that something is only worth what someone else is willing to pay for it. That may be true for soemone that has to sell, but I don't think it's true in all cases. Value can be viewed differently than just what the market is willing to pay. For example, lets say 2 guys build identical boats from scratch each spending 100k in parts alone (labor was free). The first guy pays cash for everything and owes nothing. The second guy finances 75% of the endeavor. At the end of the build, lets look at the market two ways- booming and depressed.
In the booming market, both guys values are close to what they have into the projects. It makes little difference if either wants to ( or has to sell) as each will come out OK. In a depressed market, the market value of each boat weighs very differently on each owner. As long as neither "has to sell" and each can "afford" to keep up the cost of ownership, things are still OK- and this is likely where many owners are whether they owe or not. However, there's a big difference between both owners when they "want" to sell. The guy that doesn't owe anything can weather the storm longer since his ongoing expenses don't include loan and interest repayment. He's able to reject low ball offers longer than the guy thats burdened by payments. Does it mean his boat is worth more? Not to the market, but it's worth more to him than what the market will support at the moment. I think there are a lot of folks in that situation and, still more folks that owe but prefer to keep making payments to taking the hit on a lowball value that they believe to be artificially or momentarily depressed. Of course on rare occasions, there will be someone that "needs" out and is willing to take whatever the market will bear. I don't think those situations are as common as folks think. Boats are a luxury and most folks that have made that leap are fairly well off.
JPMorgan beat expectations as did Merrill. Goldman had their best year of all since inception. Oil companies are doing great as well.
At Easter dinner, surrounded by libs and one said how bad the economy was. No, it wasn't the guy who just spent 100k on a kitchen and now wants to sell the house, it was his friend who doesn't work yet they still live in a 4br house on the wife's salary.
Apparently he was complaining about how it's not fair that newlyweds cannot purchase a house. I disagreed, asked what house he grew up in...it was a 3 bedroom, one bath apartment with 4-5 kids, as we all did. Well now, I see the problem, newlyweds CAN afford a 2-3br one bath but no, they expect a McMansion before the student loans are paid off.
Anyway, I digress. The economy is fine, here's some logic. The economy is so good that older boats are tough to sell. As well-off people trade up to new 1.5mil yachts, there are many great deals on newer used models as everyone trades up. Therefore, the older the boat, the less it's worth. If new boats stop selling, old boats will pick up.
At Easter dinner, surrounded by libs and one said how bad the economy was. No, it wasn't the guy who just spent 100k on a kitchen and now wants to sell the house, it was his friend who doesn't work yet they still live in a 4br house on the wife's salary.
Apparently he was complaining about how it's not fair that newlyweds cannot purchase a house. I disagreed, asked what house he grew up in...it was a 3 bedroom, one bath apartment with 4-5 kids, as we all did. Well now, I see the problem, newlyweds CAN afford a 2-3br one bath but no, they expect a McMansion before the student loans are paid off.
Anyway, I digress. The economy is fine, here's some logic. The economy is so good that older boats are tough to sell. As well-off people trade up to new 1.5mil yachts, there are many great deals on newer used models as everyone trades up. Therefore, the older the boat, the less it's worth. If new boats stop selling, old boats will pick up.
Arnold, I'm jumping in late to this conversation, but wanted to note that most boaters consider NADA to woefully undervalue boats, regardless of whether it's a buyer's market. Compare it to BUC, I think you'll find quite a difference.
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Joe - you're somewhat right about NADA. Part of the problem is that NADA doesn't include all the options that are added to the boat at the time of purchase as part of their "base" price. Using my boat as an example, one "option" (even though most people get it) is to get the "elite" package at a value of over 25k which includes generator, A/C and a bunch of other things. So you have to check all those items to make sure you're getting an accurate quote. In most cases though, even after selecting all the options, the value still comes out below BUC. The best ideais to use all three blue books, and additional market research, to get the most accurate idea you can.
I disagree with the comment that the guy that paid cash for the boat can weather the storm. If you paid cash, then you can take all the money and earn interest. If you didn't you can stop paying interest....there is a difference in what you pay to borrow and what get from the bank.
Either way, having a depreciating asset, that costs money to store that sits....is very bad....and it is supply and demand.
People that buy used boats want a good deal.....period....otherwise they would buy new...therefore when they see boats sit, they'll lowball, and wait, etc. That is the boat market today.
Either way, having a depreciating asset, that costs money to store that sits....is very bad....and it is supply and demand.
People that buy used boats want a good deal.....period....otherwise they would buy new...therefore when they see boats sit, they'll lowball, and wait, etc. That is the boat market today.
I am of the view that the used boat market is similar to the used car market... except that the ratio of buyers to available product is far worse in used boats than in used cars. Thus buyers have tremendous leverage on buying a used boat, particularly if you are selling the Chevrolet of the boat world (no disrespect to Chevy owners!)
There are situations with used cars, however, where demand out strips supply and the used car is more expensive than the new car (current Ferraris for example). This situation, believe it or not, exists with boats: mega-yachts, some high-end brands are examples.
It is all supply-and-demand. So my conclusion has been if you are going to by new, by something really good since quality always resells, and they are probably produced in fewer numbers.
There are situations with used cars, however, where demand out strips supply and the used car is more expensive than the new car (current Ferraris for example). This situation, believe it or not, exists with boats: mega-yachts, some high-end brands are examples.
It is all supply-and-demand. So my conclusion has been if you are going to by new, by something really good since quality always resells, and they are probably produced in fewer numbers.
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Let's not forget the age vs. demand curve.
People generally buy boats for the recreational value, not as "projects" Regardless of condition, far less people are interested in older boats.
I suppose I'm one of the exceptions, but what an amazing vessel I do have. However the reality is, REGARDLESS OF CONDITION, I have a 25 year old boat. When the day comes for her to be sold her age will deter many would be buyers.
RWS
People generally buy boats for the recreational value, not as "projects" Regardless of condition, far less people are interested in older boats.
I suppose I'm one of the exceptions, but what an amazing vessel I do have. However the reality is, REGARDLESS OF CONDITION, I have a 25 year old boat. When the day comes for her to be sold her age will deter many would be buyers.
RWS
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I am looking to buy another boat this year (paying cash) and had a seller who hads the boat on the hard for over 2 years without an offer turn down what even his broker stated was a fair price based on it rather poor exterior condition, dead batteries, bottom work to be done, etc. That just the way it goes. looking at others and will find what I want eventually.
Delaware Jim
Delaware Jim
Its funny that just yesterday I sold my kayak - it was only two days on the market, and I got the price I asked 
Too bad all the proceeds went towards a landscaping job 
Interestingly, is the market as bad for sailboats as it is for power?
Too bad all the proceeds went towards a landscaping job Interestingly, is the market as bad for sailboats as it is for power?
So what about buying new boats at a boat show? I was at the Sarasota boat show today and many of the boats had a "boat show price". The prices were about 15% below msrp.
is this really a bargain or could you get the same price at the dealer if you were a determined negotiater?
is this really a bargain or could you get the same price at the dealer if you were a determined negotiater?