Boat Prices vs. Book Value

[Arch]

Great thread and on target for me.
I want to buy a trawler (or trawlerish) anywhere along the great loop. Want to move aboard next spring.

Yacht world prices often range from $19,000 to upwards of $75,000 for the same make, model and year range. I understand condition varies a great deal, but I have looked at boats advertised as "great condition" near the high end of the price range that were truly awful.

I am struggling to figure all this out. A buyers broker would be nice but given that these boats are all over the east coast and great lakes, I'm not sure how realistic that is.

So, I will follow along with interest.

Thanks, Arch

 

[Insequent]

Seems to me that particularly for older boats, the fair price really depends on the systems installed. The extent and quality of them. Pretty hard for any statistical methods to get that right. You need someone very familiar with the make/model, and recent sales. A good broker is invaluable.

Other than systems, the amount of 'deferred maintenance' is a big factor, which can add up if you have it done for you.

My advice is to look at a lot of the particular model you are targeting - you will build some knowledge, as well as see interesting ideas from previous owners.

And only buy something you plan on keeping for 10 years, then the money you will spend on short term R&M is effectively amortised over a decent period of use.

 

[FF]

I want to buy a trawler (or trawlerish) anywhere along the great loop. Want to move aboard next spring.

Florida will be 30% to 50 % cheaper than further north.

Look in Florida Mariner .

FF

 

[Baypoint]

i think almost every boat out there is overpriced. People still living in the past. They are paying slip,insurance, and maintenance(if you are lucky). Brokers are trying to get the biggest commission they can. Have the broker print you out the past sales of the model you are looking at as well as similar models. A good place to start. Make an offer on what the boat is worth. You can buy a lot of 40" boats at less then $100K. Remember the owner probably upped the price $10k to cover the commission. A BROKER WILL DIRECT YOU TO A HIGHER PRICED BOAT EVERY TIME. When you do a walk through take pictures of anything you find that needs to be fixed. Put it on a sheet of paper and assign a price to each. Good staring point. Your best way to find a boat is to

 

[yachtbrokerguy]

. A BROKER WILL DIRECT YOU TO A HIGHER PRICED BOAT EVERY TIME.

Most brokers want a return on their time so they will direct their clients to the best deals availble. Now in the age of the internet buyers are much more knowledgable about what they are looking at, I want to bring clients to boats that fit their needs at a price that is attractive.
I will on a regular basis direct a client to a more expensive boat that is in better condition, with better upgrades, but only if it is better value.
If someone thinks that they can raise their asking price because a broker is listing the boat they are not likely to sell.

 

[psneeld]

This pretty much sums it up.

I Want To Sell My Yacht | Xtranormal

Is there another one where the intelligent boater pays some knucklehead broker a huge commission after selling the boat despite it being brokered?

In all fairness there's good and bad on both sides of the coin.

 

[Arch]

"Now in the age of the internet buyers are much more knowledgable about what they are looking at,"

I think this is true. In addition, the Internet allows me to look at boats all over the world to get comparisons.

A couple of other thoughts:
I have a friend with a wonderfully restored and equipped Irwin 37 (sailboat). He has over $160,000 into the boat and figures it would sell for maybe $65,000. Many sellers want their money back. An $80,000 fully restored 1980 trawler is competing in the market with both much newer boats at that price and with much cheaper boats of that vintage. Tough market to be in.

As to brokers upselling, they certainly do it. While the motive may be to sell me a better boat. If I have clearly stated that I am a cash buyer, and I have $xxx to spend, it does no good to show me more expensive boats. This simply tells me that they aren't listening to me.

I am enjoying this thread, thanks,
Arch

 

[CPseudonym]

There are good value priced boats at every range of the market but they get crowded out by overpriced dreamers IMO. The ads I like the most are the ones with older boats with on-going restoration work. The seller writes into the ad copy that as he does more repairs he'll raise the price of the boat! What a joke IMO.

I was scheduled to look at a boat 3 hours from now that I found yesterday afternoon and was called last night at 7pm and informed it sold. It was on the market a grand total of 10 hours.

The lesson is don't procrastinate when you find one.

 

[FF]

Folks looking for a fixer upper need not bother with a broker.

100 Lookie Lous for each low buck boat , all with out the price of a gal of epoxy.

Brokers cant waste the time on a under $20,000 sale , unless there trailer boats that he can show dozens of with one stop at a marina.

 

[roguewave]

NADA, Kelly etc... are nothing but trash in my opinion, whether buying a boat, car or truck. Doing you own homework is the only way to have an idea of market value.

 

[dvd]

"Doing you own homework is the only way to have an idea of market value"

As I understand the boat/yacht market, the most valuable information on sales price history and current comps is not available to the general public (i.e. soldboats.com). The only absolute way to determine market value is to put your boat up for sale, sell it, then count the money in your pocket. Survey value, insurance value, replacement value, assessment value, etc., etc., are proxies that are used primarily for something other than the exchange of equity, and, therefore, should have little or no bearing on "market value" or the advertised asking price.

It seems back asswards to me for the industry to make it difficult to find out a selling price. If the transaction was transparent, then people would have a level of knowledge and confidence of what a particular boat type could sell for and, I would think, the number and ease of transactions would increase, even if prices were lower. This would establish realistic expectations in all parties and be in the best interest of the seller (who is only going to get "market value" in the long run anyway), the buyer (who could tender a realistic offer) and the broker (who could increase his sales volume, making up for a slightly reduced commission).

In business consultancy language, this translates into "make it easy to do the right thing." If the right thing for a broker is to secure a transaction for his client, it seems to me that this approach would move things in that direction.

dvd
(NOT a business consultant!)

 

[Baypoint]

Weather you agree with Kelly or NADA if that is what banks and credit unions are willing to loan on then that is the value of the boat. Just like houses it doesn't matter what you think it is worth it is what the value you can finance. Yes if you have a cash buyer they can pay more but I am afraid it is just the market adjusting to reality.

 

[Art]

In many geographic locations in the U.S. (and other nations): Irrespective of any rule of thumb, or apparent comps, or value-assignment hoop-la... such as NADA, banks, surveyors, used product dealer sales persons, etc - - > Regarding the sale of a Less Than New (i.e. used) boat, car, house or anything else of similar general consumer “use-potential” or "show-off BS” or, maybe even “hopes for value appreciation” even in today’s soft market...

In the sale of any used item a current owner (definitively the seller) is a considerably passive participant who can only meekly offer said item at said owner’s particular “asking-price” to everyone/anyone (potential purchasers) who might become interested in being the used item’s new owner. Purchasers are considerably dominant participants who can offer whatever financial amount or product trade they like to the seller and refuse to pay more than they feel any item is worth to them. Therefore, in today’s soft market, seeing as throughout many geographic region and used-product types (boats, cars, RE... etc) there are many fine (and some not so fine) examples for sale by the hundreds/thousands it is strictly up to the purchaser to actually affix the product’s true-value at every sale in regard to the purchaser’s needs, like, desires, and financial capabilities. This truly has been a fact for years and it looks like will continue for some time to be a “Buyer’s Market”. Now of course the seller can refuse to accept any purchaser’s offer in hopes of another purchaser coming along with a better offer... and that may happen... but that means said seller is playing a waiting game and still holding “the bag” in today’s soft market, whose product value levels may descend further!

In research, I’ve noticed hundreds of products’ sellers who have been playing the waiting game for years now... those who hold the price high more often than not keep right on holding “the bag”... sellers who lower the price and get flexible can often locate a purchaser who will close the deal with them. One great problem for too many sellers of any type product is the situation of being “upside down” in loaned-finance on a product they have for sale. The only recommendation I can offer to sellers in that position - - > Be careful as to what will economically happen during the next few years - - > Either bite the bullet while you feel you can, or wait for a sales-value uptick that may or may not come, or stay high in price untill it is simply too late and go down in flames... like millions of unfortunates have done and millions of others are still doing!

For ten (10) years now, by my keeping a close eye on CL, Yachtworld, and other sales avenues, it is clear that for the last few years four (4) prime agenda help owners accomplish their product sale:

1. Low Starting Price
2. Willingness to be Flexible
3. Very, Very Good Condition Product
4. Great Attitude that helps the Buyer Feel Comfortable with the Deal!

Also, as may occur at times, in favor of the seller is dumb luck that a purchaser comes along who simply falls in love with the product and just has to have it! In today’s soft market, due to buyers feeling their purchasing power, a seller’s dumb luck such as this comes along few and far between... regarding most used items.

I wish good luck to sellers and purchasers alike. As I alluded to in the context of this post... read the globally interactive markets carefully, there has been occurring and clearly appears to be further unexpected economic global change in the wind. Second half of 20th Century’s presumed economic stability regarding “Business As Usual” has now become unattainable; that phrase has turned passé. “Business As Occurs” is the new global mantra. This decades long “Business Cycle” will surely encounter peaks and valleys... ride the peaks, hunker down in the valleys. It appears the valley we’ve been experiencing since 2007 may get deeper... but hopefully an upturn can occur. We shall see!

 

[JD]

it is clear that for the last few years four (4) prime agenda help owners accomplish their product sale:

1. Low Starting Price
2. Willingness to be Flexible
3. Very, Very Good Condition Product
4. Great Attitude that helps the Buyer Feel Comfortable with the Deal!

Art,

I agree with one minor exception. Number one should read "A Reasonable Starting Price". With the other three in place the Reasonable Number is attainable. Now there are times when Reasonable and low are the same number but that is a market effect.

Things like what one owes, or what I paid and such come into play all too often and they should not. The one that breaks me up is the "I paid $xxx k for it just two years ago". That affects me how? If you got it from your dad for free then you would be willing to give it to me? Not happening. Well if the latter has no bearing then neither does the former.