# Thoughts for those buying or selling...



## Cruisingdad (Jul 21, 2006)

Hi All.

I hope everyone has been doing well. Hopefully everyone has been playing nice??? At any rate...

It seems I have spent yet another worthless weekend (and part of the week) fruitlessly shopping for boats.

I won't say the type of boat, etc that we are looking at, but it seemed we had finally found the right boat. Beautifully cared for by an anal owner. There were a few glitches, but no massive hurdles. THEN... the survey. We did what I always urge everyone else to do - get a good survey and an engine survey. They really are not expensve. It probably saved our butts this time.

It seems the boat selling market has diminished quite a bit as of late (I am sure Cam can verify this one). Now while you would think that makes for a good time to buy, it also creates a big problem: Comps. Many boats have taken such a hit that when you do find a very well kept and cared for boat, comping it out will be near impossible.

If you are going to pay cash, then you will feel you can keep looking and save 10's of thousands out of pocket. If you are going to take out a loan, the bank will traditionally only lend 80% of SURVEYED value, not agreed to value. Big difference. That means you better really like that boat or get ready to write a very larve check up front in addition to your down.

Either way, it is a lose-lose scenario. Between that, insurance, cost of fuel to ship and the cost of slipping the tub - it may be tough to find a boat. Many of you that want to finance the boat may have some real problems as all of these issues add up. For those of you that do not and wish to pay cash, you better check ALL of your costs before signing on the dotted line.

No matter what, check Sold Boats.com through a broker or your surveyor. BUC seems WAY out of whack. Look at the highest sold boat in the last two year and compare equipment/comps from there. I realize (tongue in cheeck) that the boat you are buying is a much finer vessel than ANY that has ever been sold before, but the banks and surveyors will not see it that way so it may be fruitless to proceed if you are way above the highest comp. 

SO what we have found in the market are lots of boats that are total junk bringing down apparent values. Then you have nice boats that people have dumped (probably to save their house, etc) that have deflated the market - but those are gone quickly. Then you have the truely nice tub that has been well cared for... but ain't no way that owner is going to sell it for what it is worth a few years ago so you will reach an empass. Because of the beforementioned factors, its value has decreased considerably. Likely that owner will own that boat for a long time until the market turns around.

Thus, a buyers market is not always a good thing. And in the end, you may be out many thousands of dollars only for a big suprise after you write all the checks.

Buyers be informed and sellers beware: It is a frustrating market right now, no matter which side you sit on.

- CD

PS I will not list the boat type other than to say it is a heavy displacement, blue water cruiser that is well made and respected. I am concerned the owner or others will know the boat... as they very well may. SO we will speak in generalities... ok?


----------



## TSteele65 (Oct 19, 2006)

So what big items turned up in the survey?

(Sorry T- I somehow got into yours thread instead of mine... sorry about that) - CD


----------



## labatt (Jul 31, 2006)

Thanks CD... I'm glad to be trying to sell a boat right now... NOT! 

Here's one other gotcha with regards to loans... With all of the problems in the industry right now due to sub prime lending failures, banks are being very cautious in lending money. 3-4 months ago, I could have walked into any number of banks to get my loan for the boat we're buying. Today, it took me about 12 banks before I could find one willing to write the loan.


----------



## Cruisingdad (Jul 21, 2006)

TSteele65 said:


> So what big items turned up in the survey?
> 
> (Sorry T- I somehow got into yours thread instead of mine... sorry about that) - CD


I do not know all the items yet, but the value will be well less than what we agreed upon... and that is with the surveyor being extremely liberal. The closest comp was about 20-30% off. Yes, I wrote that right: 20-30% off!!!

- CD


----------



## AjariBonten (Sep 7, 2007)

Apart from financing issues, what are the insurance implications? Do they prefer to insure for surveyed value or agreed value? Is there a cost difference in insuring it one way or another? Or do insurers do it either one way or the other, without option?

Very good topic, BTW. There are many implications in any market shift; and some of them are not obvious by any stretch.


FRED


----------



## sailhog (Dec 11, 2006)

CD,
Thanks for the analysis. One question, though... what's a comp?


----------



## SimonV (Jul 6, 2006)

CD
Sorry to seem dumb, but what is COMP.


Edit your in my boat SH.


----------



## PorFin (Sep 10, 2007)

CD -- a good (and for me, timely) topic.



Cruisingdad said:


> Now while you would think that makes for a good time to buy, it also creates a big problem: Comps. Many boats have taken such a hit that when you do find a very well kept and cared for boat, comping it out will be near impossible.


Please forgive my neophyte question, but  what's a comp in this context?

Sitting quietly in the corner,
PF


----------



## labatt (Jul 31, 2006)

A comp is a price comparison - against other similar boats that have sold in the past few years. There are databases that list all of the reported boats sold and the prices they reportedly sold for so you can figure out 1) How to price your boat, or 2) What to offer on a boat.


----------



## AjariBonten (Sep 7, 2007)

I believe he means a "comparable sale"; as in "boats of similar age and make sold for"


----------



## PorFin (Sep 10, 2007)

Gracias, mis amigos!


----------



## labatt (Jul 31, 2006)

AjariBonten said:


> Apart from financing issues, what are the insurance implications? Do they prefer to insure for surveyed value or agreed value? Is there a cost difference in insuring it one way or another? Or do insurers do it either one way or the other, without option?


Banks usually require that the boat be insured for at least what you paid for it (not the amount of the loan - the total cost of the boat) including any money you put in for refit. Insurance companies, from what I've seen, like agreed upon value. My Passport 40, for example, had a $400k survey value based upon it being in absolutely perfect shape (right off the assembly line). Its real value and what I paid for it was far lower.


----------



## xort (Aug 4, 2006)

CD
Do you happen to know if there are rules about disclosing info from boatsold.com? Whenever I've asked someone with access to that database I seem to get less than what I know is there.

The pricing has become quite distorted. I'm seeing boats that have sat since 2005 listed for 35% above actual selling prices of quality boats. And the boat that has sat for 2+ years is no longer 'quality'. It will be interesting to see if there is a sudden dump of these boats that missed the oportunity to sell when the market was good.


----------



## TSOJOURNER (Dec 16, 1999)

I used those data bases when buying my Tayana and found them of limited use. There are just too many variables that go into a selling price. In addition, if you're not buying a production boat the population is limited and you need to be looking at recent sales, not ones from a few years ago. But it is better than nothing.


----------



## Lion35 (Sep 28, 2007)

Thanks this is a good topic, I've been looking and hadn't considered the ramaifications this could have on my getting the loan. BUC seems in line with the PSC 34s I've looked at, once you consider the asking price and offer price difference, but I haven't subscribed to BUC and I'm only looking at the first freebie listing they give you. 

Considering this thread do you recomend someone in the market subscribes to BUC? Is BUC the system the banks will use to get their comps?


----------



## xort (Aug 4, 2006)

teshannon said:


> I used those data bases when buying my Tayana and found them of limited use. There are just too many variables that go into a selling price. In addition, if you're not buying a production boat the population is limited and you need to be looking at recent sales, not ones from a few years ago. But it is better than nothing.


From what I've heard, BUC & NADA go back as much as 2 years for pricing comps. Boat US buyers service uses recent prices plus they use their insurance numbers to also guage pricing.


----------



## TSOJOURNER (Dec 16, 1999)

If I remember right they go back for at least 5 years.


----------



## Jim H (Feb 18, 2006)

Sounds like a "best of times, worst of times" situation.

Three questions:

1) Given the current circumstances, would it make sense to possibly wait 12-24 months on a major boat purchase, in case we're just at the start of a serious slide (meaning there will be decreasing prices/harder conditions to sell in the near future)?

2) In a weak market, are "desireable brand names and designs" even more important? I cringe when I look on Yacht World and I see 10 or more of the same production boat for sale in the same geographic area, making me wonder how one would distinguish the boat enough to sell it before the others. 

3) If one can buy with cash, does that open a wider choice in insurance options (since they won't be dictated by a bank loan)?

Thanks!

Jim H


----------



## bestfriend (Sep 26, 2006)

DOESN'T ANYONE LISTEN TO ME!! Yes, I am shouting, and don't answer that. I believe I said a couple of months ago that the boat market is down 50% in volume, not prices, but the number of boats being sold. 50%!!!!! You can name your price if you find a boat that REALLY needs to be sold or is on the lower end of the market. Older Catalina 36's that were going for 50-60k, try 30-40k. Anyone that has paid cash or doesn't have a note on their boat, you can under bid if they can't afford their boat anymore. Look for foreclosures on boats to rise for those that owe and can't afford to keep it and can only sell at a loss. I am one of the ones in CD's last category. I have a great boat, but its not quite what I want. Its not going to sell, not nearly for what I paid for it, but I can afford it and don't have to sell. So I will sit on it, sail it, and treat her like I am not selling. Its going to be hard to find good boats at a decent price, like the housing market, its drying up and people will sit on the good stuff.

Jim H
1.) I would be VERY picky about what I bought. The market may get flooded with a lot of boats that need to be sold. Prices certainly are not going up anytime soon. Take your time. 
2.) That is a phenomenon that i have noticed before and even more so now. I think, and I could be wrong, that boats like Beneteau appeal to lots of first time buyers and people that don't really know about the maintanence required. The wear and tear starts to show after 4 or 5 years, and they try to sell the boat instead of fixing and upgrading. Look at all the 5-6 year old Beneteaus with roller furling on the market. Its time for a new sail. Also a lot of those boats come out of some sort of charter after 3-5 years. Sorry to pick on that brand, I like a lot of their boats, just an example please, okay.
3.) I don't know.

Edit - BTW my first sentence wasn't directed at you CD, just ranting.


----------



## sailhog (Dec 11, 2006)

Bestfriend... Bestfriend... Bestfriend... I can't hear you... What did you say, Bestfriend?


----------



## PalmettoSailor (Mar 7, 2006)

bestfriend said:


> snip... Look for foreclosures on boats to rise for those that owe and can't afford to keep it and can only sell at a loss. I am one of the ones in CD's last category. I have a great boat, but its not quite what I want. Its not going to sell, not nearly for what I paid for it, but I can afford it and don't have to sell. So I will sit on it, sail it, and treat her like I am not selling. Its going to be hard to find good boats at a decent price, like the housing market, its drying up and people will sit on the good stuff.
> 
> snip


I don't know that that bodes well for those of us that would like to move up. Like CD I've been looking for a few months and I've already seen a several disappointing boats in the $60-80k, 36'-38' range lately. I suspect that is due to marginal owners being forced out as other expenses take precedence over their boat.

If folks feeling financial pressure decide to hold on to their currently well maintained boats to wait for the market to come back, it'll probably just result in more disappointing boats eventually comming on the market when they finally accept that the market has changed. Unfortunately, if they hold on, they may get even less if the neglect takes hold. Taking proper care of something like a boat is usually one of the first expenses to get cut when money gets tight.

I think what CD is pointing out is that current sellers have not yet adjusted their expectations to match the current reality. When folks are paying $60 for a tank of gas and being crushed by rate increases on their adjustable rate loans, the number of people in position to buy a boat goes down and prices have to follow.

Time will tell.


----------



## bestfriend (Sep 26, 2006)

No, it doesn't bode well for us. So rather than dump what I have now at a loss, I will upgrade her to a condition that I am satisfied with. I am just going to be happy with what I have for now, and put off the trade-up for 3 or5 more years. I don't expect to make money or anything, even after upgrading, but I will be satisfied getting good use out of her, having her in great condition, and having a more sale-able boat in the future.


----------



## Cruisingdad (Jul 21, 2006)

labatt said:


> Thanks CD... I'm glad to be trying to sell a boat right now... NOT!
> 
> Here's one other gotcha with regards to loans... With all of the problems in the industry right now due to sub prime lending failures, banks are being very cautious in lending money. 3-4 months ago, I could have walked into any number of banks to get my loan for the boat we're buying. Today, it took me about 12 banks before I could find one willing to write the loan.


Very true. Boat brokers are really hurting right now.


----------



## Cruisingdad (Jul 21, 2006)

AjariBonten said:


> Apart from financing issues, what are the insurance implications? Do they prefer to insure for surveyed value or agreed value? Is there a cost difference in insuring it one way or another? Or do insurers do it either one way or the other, without option?
> 
> Very good topic, BTW. There are many implications in any market shift; and some of them are not obvious by any stretch.
> 
> FRED


To the best of my knowledge, it is surveyed value unless what you paid is less than surveyed. ANyone please feel free to correct me if I am wrong.

- CD


----------



## Cruisingdad (Jul 21, 2006)

sailhog said:


> CD,
> Thanks for the analysis. One question, though... what's a comp?


A comparable boat... what a comparable boat sold for.

- CD


----------



## Cruisingdad (Jul 21, 2006)

labatt said:


> A comp is a price comparison - against other similar boats that have sold in the past few years. There are databases that list all of the reported boats sold and the prices they reportedly sold for so you can figure out 1) How to price your boat, or 2) What to offer on a boat.


Right on!! Sorry, I did not scroll down before answering the questions.

- CD


----------



## Cruisingdad (Jul 21, 2006)

xort said:


> CD
> Do you happen to know if there are rules about disclosing info from boatsold.com? Whenever I've asked someone with access to that database I seem to get less than what I know is there.
> 
> The pricing has become quite distorted. I'm seeing boats that have sat since 2005 listed for 35% above actual selling prices of quality boats. And the boat that has sat for 2+ years is no longer 'quality'. It will be interesting to see if there is a sudden dump of these boats that missed the oportunity to sell when the market was good.


The info in Soldboat.com is only as good as the integrity of the broker that put it there. That being said, it is still probably the best indicator. BUC seems way off. They are only tools - but the only tools that really seem to be available to surveyors. They surveyor will price up/down depending on those numbers.

Yes, what a boat might have sold for a few years ago and what it will sell for today may be very different. What was interesting is that the price difference on the boats we were looking at going back several more years were... 60-70% higher. It is a symptom of the market. Yes, they missed the oppotunity.

However, not to toot the Catalina horn, but I am not convinced it is all boats. For example, the Catalina healer here is doing VERY well. They move boats quickly - new and used. There still seems to be a good market for these boats - at least here. I cannot pretend to know the whole market everywhere and only give my opinions on what I am told and what I see.

- CD


----------



## Cruisingdad (Jul 21, 2006)

Lion35 said:


> Thanks this is a good topic, I've been looking and hadn't considered the ramaifications this could have on my getting the loan. BUC seems in line with the PSC 34s I've looked at, once you consider the asking price and offer price difference, but I haven't subscribed to BUC and I'm only looking at the first freebie listing they give you.
> 
> Considering this thread do you recomend someone in the market subscribes to BUC? Is BUC the system the banks will use to get their comps?


Most banks that do REAL boat loans go off of the surveyed amount. I don't see any point subscribing to Buc or any of them - even if you could. Your broker will have that info. If not, your surveyor will. Any good surveyor/broker will give you all of that info (assuming you are going to use them and look at their boat).

However, if you go through a credit union or use a non-traditional large boat loan (which I would not suggest), many use NADA.

- CD


----------



## TSOJOURNER (Dec 16, 1999)

bestfriend said:


> No, it doesn't bode well for us. So rather than dump what I have now at a loss, I will upgrade her to a condition that I am satisfied with. I am just going to be happy with what I have for now, and put off the trade-up for 3 or5 more years. I don't expect to make money or anything, even after upgrading, but I will be satisfied getting good use out of her, having her in great condition, and having a more sale-able boat in the future.


I'm in the same boat, so to speak. we were gonna "off" ours and upgrade in the spring. but now i think i'll just hold off and enjoy her even though Key Bank offered us a sweet deal on a loan. as we all know, the best deals always arrive at the worst possible time.


----------



## TSOJOURNER (Dec 16, 1999)

If you are thinking of buying a boat - hold off, because the prices are going to be much, much lower in the fairly near future. Hate to be a harbinger of doom and gloom, but it's going to be another three months before it becomes apparent how deflated the US economy has gotten, and once business moves into survival mode, there will be some incredible deals to be had.

Thats going to work on both the buy and sell sides so, you'll still be able to upgrade if you like, you'll be selling cheaper and buying cheaper, but the transaction will still work.

If you have a substantial loan on a boat right now ... well ... hmmm ... get rid of the loan somehow. A lot of financial institutions are going to be calling in a lot of loans that they feel (rightly or wrongly) are not 100% gold-plated, tangible asset-backed, sure things. There will be a certain amount of overreaction on their parts, so be prepared.

Insurance will be the major boondoggle. They are going to get hit as well, so it's going to be hard to get them to write an agreed-value policy that inflates as the economy clears up and boats regain their value. In the case of the older boats, that may never happen regardless of how great their condition is. So - don't borrow money to buy an old boat.

Probably best to stick with one of the more "nautically-minded" insurance companies out there. They'll have at least a superficial understanding of what they are insuring, and it's market value.

The lucky people, as always, will be those who have cash in times of difficulty. There are certainly going to be some good prices next summer


----------



## Cruisingdad (Jul 21, 2006)

Jim H said:


> Sounds like a "best of times, worst of times" situation.
> 
> Three questions:
> 
> ...


Jim,

I will give you my opinions. They are only my opinions and should be taken as such.

1) No, I think it is a very good time to buy boats. Why? First, rates are at an all time low. If inflation starts to build up and rates go up, boats will get more expensive. THis, in my opinion, will have more of an effect on new boat sells than used. Why? O-I-L. Oil is at an alltime high. Look how much petroleum products go into building a sailboat. Honestly, I bet 70% of a sailboat is proprietary - from the pumps to the tanks to the spar. They all have to get there and as the price of oil goes up, it has a considerable effect on sailboats. Right now, these boats are moving because people can afford them due to the low interest rates (remember, we Americans buy our stuff based upon the cost/month not the total cost! smile). When interest rates start to go up, people will now only be able to afford the used boats which will finally start to make them appreciate again (or at least slow the bleeding). Mark my words, if interest rates go up AND oil stays high, it will be the perfect storm for boat builders and many will close up shop. I have been told that profit margins are thin right now anyway.

2) Desirable brand names? Like Oyster versus Hunter? Not sure I follow you, but I will say that desirable is based upon how you intend to use the boat. Seriously, don't buy a bullet proof shoe box for coastal cruising. Also, though there are many Catalinas (using them for the sake of discussion) on the market, at least it is a brand very well known by both knowledgeable and unknowledgeable sailors. Go to the typical buyer at the boat show and mention the word Mason to him and watch as he tells you, "I ain't Mason. You got the wrong guy."

Get the picture? You have more buyers AND a less expensive boat. However, that does not mean it is the right choice for circling the world.

3) Yes. You can have NO insurance. However, can you afford to lose it all? If the answer is no, then maybe you answered your own question. However, I have found MANY cruisers sail without insurance. In some cases (like parts of the Western Carribean) you almost don't have a choice as it is very expensive if they will even cover you. I also have found many American marinas (and other marinas around the world, I woudl suspect) require minimum insurance liability and proof there of. You may have to get it no matter what.

- CD


----------



## Cruisingdad (Jul 21, 2006)

bestfriend said:


> DOESN'T ANYONE LISTEN TO ME!! Yes, I am shouting, and don't answer that. I believe I said a couple of months ago that the boat market is down 50% in volume, not prices, but the number of boats being sold. 50%!!!!! You can name your price if you find a boat that REALLY needs to be sold or is on the lower end of the market. Older Catalina 36's that were going for 50-60k, try 30-40k. Anyone that has paid cash or doesn't have a note on their boat, you can under bid if they can't afford their boat anymore. Look for foreclosures on boats to rise for those that owe and can't afford to keep it and can only sell at a loss. I am one of the ones in CD's last category. I have a great boat, but its not quite what I want. Its not going to sell, not nearly for what I paid for it, but I can afford it and don't have to sell. So I will sit on it, sail it, and treat her like I am not selling. Its going to be hard to find good boats at a decent price, like the housing market, its drying up and people will sit on the good stuff.
> 
> Jim H
> 1.) I would be VERY picky about what I bought. The market may get flooded with a lot of boats that need to be sold. Prices certainly are not going up anytime soon. Take your time.
> ...


Hey BF, I know. It is as frustrating for me... believe me. We sure have discussed this a bunch before, haven't we!! THe market is changing. I do think that the time for well kept, used boats is coming though. I feel like buying now is buying when the market is low. They might go lower some, but in the end, they will go up. Look how much a freaking Catalina 400 costs now!!!! H-Oly Crap! That is a lot of capital... and the 400 is not the most expensive of the production boat lines by a far shot. They are going to price themselves out of a market when the interest rate rises. If oil stays high too... it will not be pretty. Pictures of 1989 come to mind.

- CD


----------



## bestfriend (Sep 26, 2006)

Interesting, our two opinions. Not so much opposites, but looking at things from different viewpoints. I would have to agree with you about buying sooner rather than later for a new boat. Just like the auto industry, they are hurting and you could haggle some good deals with rates and such. But, I think the older the boat gets, and the less taken care of it is, the more you can name your price. Its pretty much always that way anyway, but I think it will get much more pronounced. If boats were like houses, and you had capital right now, you could just buy another one and hold on to them both. But alas, boats are far from houses. If you let your boat sit too long un-cared for, it becomes one with the sea. 

Just for reference, most of the info I am spewing out about this is coming form two dealers, one is a big time company and the other is very small. The bigger one, this time last year, was turning over boats on a weekly basis, some of them sold before they got listed. Now, the new ones and the old ones are just sitting. 

I just looked at the 400 prices, they seem to have gone up 10-20k? Is that what you see too? Catalina is an exception to me, and we can talk about that in PM's. I think we agree there.


----------



## Jim H (Feb 18, 2006)

Cruisingdad said:


> Get the picture? You have more buyers AND a less expensive boat. However, that does not mean it is the right choice for circling the world.


CD, thanks for the detailed reply. It's interesting how my initial impressions/concerns are more silmiar to Sailormann's post, but I can also see it from your perspective.

It seems like the scenario mostly depends on how large of swing there is in the economy. It seems like the "Internet pop" of a few years ago had relatively short consequences compared to the run away inflation of the late seventies/early eighties. It seems like we've had mostly minor swings in recent times, that creates smaller windows of opportunity for taking advantages of loan rates, demand for new and used boats, consumer confidence for purchases like boats, etc.

In a minor swing situation, I think your advice is right on. The market is slowing, rates are still good, insurance is available. If the swing is larger and longer, then the image changes. Buying now might still be purchasing at the high end of the curve, and if the swing is low enough then there may not be a corresponding rise in resell rate of older boats (since I'm not sure how many brand new sailboats are sold even now). It could happen that even used boats are going to sit on the market for longer periods of time, driving down actual sales prices. If the swing is going to take several years to move out of, then it's hard to jugdge when to buy to avoid having one's one resell nightmare.

My point about "desireable names" is maybe a simple one-- and I think it has more to do with the class/quality of the boat than whether it can circle the world or not. Some older boats are always in higher volume, and their prices fluxtuate according to supply and demand. Some older, rarer boats appear to have flattened out in depreciation and some have even increased in value due to unique factors (such boat reputation, manufacturers moving high end, etc.).

In the Practical Sailor boat buying guides, there is a chart of selling prices over a period of years. If you scan the charts for a wide range of boats, it's clear that 1992-1994 was a "bottom out point" in selling prices for a lot of boats, but there are a range of boats that they rebounded significantly in the following years in terms of selling prices. For a boat like a 1986 Hallberg Rassy 42, the average selling price in 1994 was $140k. In 2000, the same 1986 boat was selling for an average of $200k. A 1984 Morris Justine was $86k in 1992, and then $138k in 1998.

Anyway, if there's a chance we're moving toward another 1992/94 situation, I'd like to think about different classes of boats. Your point about Catalinas and other better-known and desired boats is still valid, but changes that swing down the selling points of Hallberg Rassys, Malos, Morris and Oysters are more rare and perhaps easier to recover from long term. (You can insert your own list of higher-end performance boats here if you prefer.)

Also, if selling boats is going to be a hard for some time, then maybe having a boat you commit to for a longer ownership period isn't a bad idea-- no transition boats, just the one you're going to care for 10 years or more. Any boat is going to require quite a bit of work, no matter what the brand.

Thanks, and have a great Thanksgiving.

Jim H


----------



## labatt (Jul 31, 2006)

I'm seeing euro boats going up in price. For example, the Hallberg-Rassy 53 I'm buying has actually appreciated since 2000. Why? The Euro has gotten stronger against the dollar and the price of a new HR is going up, dragging the used market up with it. European buyers are finding it cheaper to fly to the US, buy a boat here and ship it back or sail it back. Talk to brokers in Annapolis - they are seeing more and more European buyers these days. Broker tactics haven't changed however - push push push people are looking at the boat you have to go to contract immediately or you will lose the opportunity to buy the boat push push push.


----------



## bestfriend (Sep 26, 2006)

Labatt brings up a good point. In a volatile world economy, the ever changing dollar plays a big role in prices. Different countries see different opportunities to buy and sell, and those different countries are stocked with different brands of boats.

Jim H. You mention variations between brand prices according to quality. That variation also exists within brands too. Take Beneteau again. The 456 is a very desirable, well made, older boat that holds its value very well. There are about six of them on YW. There are pages and pages of the 473 or any oceanis, with all types of varying prices. The models that will be dropping in price in order to sell is easy to see.


----------



## PalmettoSailor (Mar 7, 2006)

bestfriend said:


> snip... I will upgrade her to a condition that I am satisfied with. I am just going to be happy with what I have for now, and put off the trade-up for 3 or5 more years.


I keep going back and forth on the same decsion. I was interested in my slip neighbors Tartan 37, so I posted my boat on sailboat owners at a pretty aggresive price for a fast sale before the Tartan got gone. However, after some more thought, we determined that though we both love the lines and the on deck and below deck layout, the Tartan 37 did not have some of the features that were important to us, so we started looking at what was out there and just haven't found anything that really appealed to us and seemed to be a decent value.

We ended up canceling our ad, but I still have one guy interested in the boat. He's had a buddy go look at it and he's going down over this weekend to take a look himself. Based on his buddy's comments he's indicated he's interested in the boat at my asking price, but since I'm having a hard time finding something I'd be happier with and can pay cash for. I'm somewhat at a loss. It's a tough choice to start equipping up the current boat to meet your desires knowing you'd really like a bigger boat vs. selling and hoping somethng else you can afford comes along that is at least as nice as what you have. Our boat is not perfect but compared to most of what we've looked at so far, its in much better shape.


----------



## TSOJOURNER (Dec 16, 1999)

Midlife...

I think you might profit nicely if you were to sell now and then sit on your cash for six to nine months while you look for the perfect new boat.


----------



## PalmettoSailor (Mar 7, 2006)

Sailormann said:


> Midlife...
> 
> I think you might profit nicely if you were to sell now and then sit on your cash for six to nine months while you look for the perfect new boat.


Yeah, that thought has come up as well. I probably pulled the ad too soon, because we've been focused on having a boat ready for sailing next spring.

However, if the fellow still looking does buy the boat, we probably will not make a move ourselves until at least next spring or maybe later. We are tied in to the racing set at a nearby yacht club so we can always get out on OPB's if we don't have a boat next spring. Still, while racing has its rewards, it doesn't compare with dropping anchor of your own boat in one of the gazillion scenic coves on the Chesapeake and watching the sunset.


----------



## sailingdog (Mar 19, 2006)

Of course this could also seriously backfire if the dollar weakens any more and you've got your money in dollars.. If the USA doesn't take some serious steps to lend credibility to the solvency of the dollar, it will stop being a currency of any worth. The extremely high deficits that have been run up by the Bush administration, combined with the problems in the economy from the credit crunch caused by the failure of the secondary mortgage market, and the exceptionally high trade imbalance, the dollar is rapidly becoming a third-world currency.



Sailormann said:


> Midlife...
> 
> I think you might profit nicely if you were to sell now and then sit on your cash for six to nine months while you look for the perfect new boat.


----------



## labatt (Jul 31, 2006)

At the dinner table last night we were talking about converting all of our $$'s to gold when we sell all our stuff in a couple of years . We could use some more ballast.


----------



## sailingdog (Mar 19, 2006)

Labatt-

I'll be sure to tell my friends to keep an eye out for your boat...  They'll be more than happy to help lighten your load..  and they'll be on the boat with the Jolly Roger flying.


----------



## codmander (May 4, 2006)

labatt said:


> A comp is a price comparison - against other similar boats that have sold in the past few years. There are databases that list all of the reported boats sold and the prices they reportedly sold for so you can figure out 1) How to price your boat, or 2) What to offer on a boat.


great vids and pics thanks


----------



## bestfriend (Sep 26, 2006)

Sailormann said:


> Midlife...
> 
> I think you might profit nicely if you were to sell now and then sit on your cash for six to nine months while you look for the perfect new boat.


But thats the problem. Try selling your boat now without taking a hit, or going upside down on the loan.


----------



## davidpm (Oct 22, 2007)

*Why do you say that.*



Cruisingdad said:


> Very true. Boat brokers are really hurting right now.


Which broakers, Sail, Power, Used, New.
What state?
I was looking at some used boats in Noank, Ct.
The broker had almost nothing to sell.
He said he was selling a large percentage of boats to Canadian's because their dollar was so strong. He said they were comming down and buying boats sight unseen with no survey.

He seemed very happy.
I'm interrested in what exactly you have seen that indicates to you that the broakers are hurting.


----------



## sailingdog (Mar 19, 2006)

Actually, I know at least one broker who is going to be selling over 50 boats this year, and most of them fairly decent in size.  So, I wouldn't say that all brokers are hurting...the good ones are probably still doing quite well...and the mediocre and bad ones are probably getting hammered.


----------



## PorFin (Sep 10, 2007)

*OK, I'm dense -- so shoot me.*

CD,

You say BUC is way off -- do you mean that BUC is overvaluing or undervaluing the vessels?


----------



## PorFin (Sep 10, 2007)

*Timing is everything*

So, what should we do?

We're going to buy a cruiser before next summer. We've looked a many, but are leaning VERY heavily towards the C36 MkII as a fair compromise to meet most of our needs *(and please, let's not get into yet another debate about the relative merits of different production boats...)*

There's a good number of C36's out there on the market -- some which have been there for a LONG time. All of the newer listings are carrying prices in the above-average BUC range, which kind of obviates the "average" moniker.

We do intend to pay cash for the vessel, so there will be no financing issues.

What's the verdict:
a) Wait, thus allowing the sales data to continue to push down the "fair market value"; or

b) Make a fair offer now; or

c) Make an insultingly low offer now, and if that's rejected wait another six months and swing again.

Man I love this place!


----------



## PalmettoSailor (Mar 7, 2006)

bestfriend said:


> But thats the problem. Try selling your boat now without taking a hit, or going upside down on the loan.


I don't owe anything and since it was our first boat be bought at the low end of the market so even though I'll take a hit if I sell for what I advertised the boat at, the pain won't be all that much. My porfolio rises and falls far more than what I'll loose on the boat and the stocks sure haven't provided the memories this boat has.


----------



## xort (Aug 4, 2006)

Porfin
Set your limit and make an offer on the best condition boat you can find. If you don't get it, make the offer on the second best boat you can find.
Biggest issue is setting your limit!


----------



## PorFin (Sep 10, 2007)

Xort,

Like I mentioned earlier, I'm a bit dense. 

Your advice boils it back down to the root of my question, following up on previous posts ---

How do we set a realistic limit on a fair price for the vessel we want to purchase? If the market's depressed, and BUC values are way high (which is what I think CD implied earlier), then where do we start the bidding? 

Lots have mentioned (quite reasonably, I think) that current sellers of well-kept boats are going to be loathe to part with their vessels at lower prices than they anticipated, at least until the darkest hours of the market slump come into view. 

Am I somewhere east of Venus on this???


----------



## bestfriend (Sep 26, 2006)

You should buy based on the same criteria as always. Pay based on what you are willing to pay and can afford, not on what the market is doing. Your bid should be the same, you just might want to try it on higher priced boats to see if you get a hit. It all depends on what the sellers will take for the boat and what the buyers are willing to pay. Forget the guides and the dealers. Keep your bid the same and throw it out there for different boats at different levels. You can always back out.


----------



## sailaway21 (Sep 4, 2006)

bestfriend just gave probably the best advise posted to date. If you're buying a boat for the long term and are interested in a limited number of boats buy what you can truly best afford that is in the best condition, and go to sleep comfortably. Focusing on beating the market is nice, but can lead to paralysis of analysis. If you end up with what you want, even paying ten percent more than the guy down the dock, you'll still be happy ten years from now. And anybody who purports to tell you authoritatively what it will be worth ten years from now is a charlatan.


----------



## TSOJOURNER (Dec 16, 1999)

"You can never pay too much for a good boat, and you can never pay too little for a bad one"


----------



## snider (Jun 26, 2006)

*Old Boats?*

Great topic! I have beem watching boats online and walking the docks since 2003. Trying to get into a position where I can buy a solid boat for the long haul. I tend to look at Pacific Seacraft, Shannon and other high quality blue water boats. What I have noticed is that older solid cruisers have been appreciating in price over the last few years. Take the Shannon 28 for example. Two years ago they were listing for 40-50 thou. Now upper 50's. Same for PSC. What makes me hesitate is take a 1980's era boat that is appreciating, how long and how many people will continue to pay a higher price for an agging boat pushing 30 years old?

The price I'm willing to pay keeps getting lower because I don't want to be tied up in a lengthy mortgage, and I like the solid blue water boats (_read: expensive_), so it has forced me to start considering smaller boats 24-28 feet. I'd like a 34.

The housing market where I live is still going pretty well. It's the condo market that's really suffering due to flooding the area with apartment conversions, which I fell for. Selling price is $5 grand less than waht I paid 3 years ago. So much for selling and buying a boat. Looks like i'll be renting it for awhile  Brandon

I'd like a solid steel boat if anyone has any leads.


----------



## tommyt (Sep 21, 2002)

PorFin,

If you have the cash, and want to go sailing, buy the boat you will stick with for 5 years or so now. The C36 can be a great boat, and there are a lot of people that have been sailing them for 20 years. Do some research in YOUR AREA on the boat. In some markets there are a lot of C36 in various conditions. In others, the boat is in short supply and the prices are higher. 

Make an offer somewhat less than your research shows you are willing to pay, and make it contignent on a survey. If all goes well, you have a boat to enjoy. 

Nobody can tell you what the market will be next year or five years from now. However, if you continue to kick tires for 5 years, you will have missed 5 years of sailing. Unless you really enjoy kicking tires, sailing is more fun. Unless you have an unlimited number of years ahead of you, I would not waste the time because someone THINKS you will save some money. Like the Visa ad, sailing time can be priceless. 

At the end of the day, a boat is a depreciating asset. How fast it depreciates depends on what you paid for it, how you care for it, and the market. You can never control all of those factors, so go with what you can. I think that the C36 is a great boat for a couple, two couples if you are close, or a family of 6 if you like camping. 

Sailormann,

What kind of a loan are you talking about being "called" by the banks? Certainly, if the loan is in default the bank can repo a boat. However, if the boat loan is current the bank cannot just decide to "call" a loan. They and you sign a contract.They can sell it to someone else, but I have not heard of solid loans being "called". Please explain. 

Oh, I agree that the market (stock or boat) is not a fun place to be right now, but I don't thknk the sky is falling quite yet. Do I wish that I would have bought more gold, yes! I also wish I would have bought more Berkshire Hathaway and a couple of cellular companies.


----------



## mikehoyt (Nov 27, 2000)

hmmm....

I think for sellers you have to put your boat for sale with the plan that it will not sell and continue to enjoy it. Someone will eventually come along that wants eactly the features of your boat and willing to pay close to your cost.

For buyers there are a LOT of boats out there.

Patience on selling and on buying and spending time at both seems to work.

Also - a lot of people like a lot of pictures and info. I created a website for my boat and links all over the place on ads I posted on web sites and on old fashioned cork B boards. Had a lot of tire kickers and a lot of people that were not very specific in their desires for a boat. And then one guy who wanted exactly the make and model I had for sail with the options I had on the boat. It is now sold - despite being the highest priced of the three he looked at.

http://users.eastlink.ca/~mhoyt

The boat sold in November just about a month after I decided that it was not going to sell and had made plans for this year's upgrades. I didn't know what to do when I had to go show it - I didn't want to sell it that much and at the same time if listing a boat or anything else you have to do the best you can to make the sale happen.

Immediately after selling I started looking for a potential next boat. With th eexchange rate it is like opening a Pandora's Box for us Canadian sailors. The flip side is it sucks to sell a boat locally because of the cheap boats available all over the Eastern US and Canada...

I guess the rule is - patience on selling and buying

Mike


----------



## Jeff_H (Feb 26, 2000)

TommyT: 
The last marine loan that I had included language which basically gave the bank the right to require you to either come up with cash, or default on the loan if the value of the boat fell below the amount of the loan. It also cancelled the policy if you failed to maintain insurance on the boat equal to the amount of the loan in the case of a total loss. Since most marine loans are for 80% or less of the boat's value at purchase, in theory a relatively loan on a boat that lost more than 20% of its value at the time of sale, could be recalled, or if an insurance company failed to insure a boat for its loan value, the loan could be recalled. 

At this point, I am not sure sailboats are in jeopardy here. Depending on what you believe, while power boats have experienced a big drop in prices, and the market is packed with boats for sale, around here clean sailboats are selling for roughly what the sold for a year or so back, but are staying on the market approximately 3-6 months longer. At least in the models that I have been tracking, there does not seem to be a big drop in prices, or increase in sales times or inventory. 

Jeff


----------



## JohnRPollard (Mar 26, 2007)

Jeff_H said:


> At this point, I am not sure sailboats are in jeopardy here. Depending on what you believe, while power boats have experienced a big drop in prices, and the market is packed with boats for sale, around here clean sailboats are selling for roughly what the sold for a year or so back, but are staying on the market approximately 3-6 months longer. At least in the models that I have been tracking, there does not seem to be a big drop in prices, or increase in sales times or inventory. Jeff


Jeff's comments agree with my casual observations about the greater Annapolis/Chesapeake market. Over the years, I've noticed that when things "slow down" a bit, the market tends to somewhat self-regulate. Many owners just hang tight with the boat they have, so there tends to be less buy/sell activity and inventory among good clean boats. I've also noticed that, no matter what the market, there always seems to be a surplus of old, tired boats at "bargain" prices. And many of those "bargains" will bleed you dry over time, with the final insult coming when it's time to re-sell...

Comments above relate to sailboats. Average Joe sportcruisers, on the other hand, seem to be having a tough time. Twin 454 gas engines can burn through a tremendous amount of gas in one short afternoon. It's tough on the wallet when your fuel consumption is measured in gallons per mile.


----------



## Cruisingdad (Jul 21, 2006)

I would like to refer this thread back to another I recently wrote on a similair topic (BUC values...). http://www.sailnet.com/forums/showthread.php?t=39310

I still think a well kept boat will sell, and sell higher than others... even in this market. The difference may be that they will not get a premium for it anymore, if much financial benefit at all.

- CD


----------



## Sasha_V (Feb 28, 2004)

And at any time when dealing in boats, you also have to wade through the boats for sale that are not *really* for sale. 
The husband promises his wife that he will sell the boat and settle....and that boat has worn five for sale signs until they have yellowed and cracked off....
The boat is for sale, but he is going to make sure you have to pry it from his cold dead fingers.

There are the people that do not see their boat as a mere asset but as an emotional expression of the love and inspiration that the universe can offer to the lucky sailor that is worthy of their craft (Mind the splinters, and try not to stand on that patch of deck over there, we don't think you'll fall all the way through, but...).

In short, far more then with cars or houses, even classic cars, you have to wade through the "Yes, but not really" items that muddy the waters of both buying a boat and being able to make reasonable comparissons and price charts.

Sasha


----------



## Gryzio (Dec 13, 2007)

*I may confuse everyone on this*



Sasha_V said:


> And at any time when dealing in boats, you also have to wade through the boats for sale that are not *really* for sale.


Very true statement. Sometimes sentiment value is unattainable. I answered a question earlier about Sailing Simulators. I explained how I started. Both of the Boats were my brother's. Today they sit in his Cow Field sinking into the ground. I wanted to buy the 24' as it was the first real Sailboat I sailed and learned on (My Sentiment). But, Noooo! He not give an honest price, better to see them sink into the mud. But, I guess they where his first boats and he want to keep too.

I am very interested in what being said here as I am looking for the boat I "May" spend the rest of my life on. I invest in FOREX so watching world money exchange is not unfamiliar. Plus as I try to discern now, how this exchange affects the USA buyer.
I seen someone mention something along the lines of a percentage cut. Like if a boat ask price is 100 offer 50-60 (Example numbers). So, this have me thinking, maybe an offer price "Could" be 30-60% less than the ask on a used boat? I think I understood this?
But, here a quick run down. I plan to pay cash! My experience has been through the individual in the past, give them what we agree and I get title to the boat. No broker stuff. Never dealt with Brokers, though I did work in Real-Estate and have a concept of how they work.
I not ship my boat, I go get and drive/sail her home (Long story on that fix on the fly stuff).  
So, if I not confused everyone.
IF, I looking at an old boat? (I love old boats [the ugly duckling] as they not look like everything else in the Duck Pond). I looking at a boat that down to it's last dollar (in a round about way). Would I be fair in offering 30-40% less than asking price? Especially through a Broker? OR, is the broker going to try to hold out for more, when the seller willing to take less?
I hope people see what I ask as this is important. But, as I told a woman friend, I not out to cheat or take advantage a seller. I am the type person that try to be fair in both directions. I know my maximum price I can pay and how low a fixer-upper cost to fix up (my minimum plus fixing).
I have a few boats that I really want and wait and watch. I will NOT buy until my budgeted time due to seasons and time to move my new home.  
So, somewhere in all this is my question(s). Hope someone have the answer.


----------



## tommyt (Sep 21, 2002)

Jeff,

Thanks, I have seen loans that are structured like that. I agree however, that someone making good on one of those loans will not be in much trouble today. The banks are having enough trouble with real estate to worry about value on sailboat loans under a million.

Thanks


----------



## Cruisingdad (Jul 21, 2006)

Gryzio said:


> Very true statement. Sometimes sentiment value is unattainable. I answered a question earlier about Sailing Simulators. I explained how I started. Both of the Boats were my brother's. Today they sit in his Cow Field sinking into the ground. I wanted to buy the 24' as it was the first real Sailboat I sailed and learned on (My Sentiment). But, Noooo! He not give an honest price, better to see them sink into the mud. But, I guess they where his first boats and he want to keep too.
> 
> I am very interested in what being said here as I am looking for the boat I "May" spend the rest of my life on. I invest in FOREX so watching world money exchange is not unfamiliar. Plus as I try to discern now, how this exchange affects the USA buyer.
> I seen someone mention something along the lines of a percentage cut. Like if a boat ask price is 100 offer 50-60 (Example numbers). So, this have me thinking, maybe an offer price "Could" be 30-60% less than the ask on a used boat? I think I understood this?
> ...


My opinion on this is such: Yes, you can get a good deal if you really wait. But not a steal. If you are waiting for the awesomely kept boat that the owner is going to take thousands and thousands under value on because the market is bad - you will never find it. Put yourself in his shoes: either you want to sell it because you cannot afford it (and would not have the money to make up the difference) or because you can no longer use it (but have the money so you will bide your time). The difference is that in a bad market, he will have to be realistic. And if you think you are better buying the cheapest boat that is a great deal becuase the owner is sick of it - you can bet it will have more issues than you bargained for.

Nah... get the boat that the owner has been "anal" and passionate about... and pay more for it. THat is my "recent buyer" advice and my opinion.

Did that make sense??

- CD


----------



## Gryzio (Dec 13, 2007)

*Yes, this about were I stand!*



Cruisingdad said:


> My opinion on this is such:
> get the boat that the owner has been "anal" and passionate about... and pay more for it. That is my "recent buyer" advice and my opinion.
> Did that make sense??- CD


Your answering, similar to what I was thinking.  But, reassurance helps.
Two of the boats I eye seem to have been very well maintained and proper maintenance over the years was done with papers to back it up (Which I will verify to the best ability I can). I may not try to get too ignorant as to offer much less than they asking as the boats (To myself) seem to be well worth the asking price.  
I just thought it never hurt to ask opinions. Was actually glad to see a reply, Thanks!  
I still keep watching this thread as it a good converse of present conditions and I enjoy reading the opinions, not only to boats, but, a few other little tidbits.


----------



## Cruisingdad (Jul 21, 2006)

Sasha_V said:


> And at any time when dealing in boats, you also have to wade through the boats for sale that are not *really* for sale.
> The husband promises his wife that he will sell the boat and settle....and that boat has worn five for sale signs until they have yellowed and cracked off....
> The boat is for sale, but he is going to make sure you have to pry it from his cold dead fingers.
> 
> ...


No doubt, Sasha, that would be me. I agree with you. Isn't a boat one of those things that feels like it is a part of you??? It is to me (BBQ Grill and all!!)

- CD


----------



## 121Guy (May 6, 2007)

*Another Resource*

Those buying or selling might want to consider the Boat US Valuation Services as another data point. Members can get free evaluations by filling out a short form on the boatus.com website. I believe they use sold data as well as survey data from all their insurance records. Kinda cool! Good luck.


----------



## PalmettoSailor (Mar 7, 2006)

121Guy said:


> Those buying or selling might want to consider the Boat US Valuation Services as another data point. Members can get free evaluations by filling out a short form on the boatus.com website. I believe they use sold data as well as survey data from all their insurance records. Kinda cool! Good luck.


I've done that for the boats I'm interested in, and in my case, I found all of the boats were above the BoatUS valuations by signficant margins, but the newest boats were over by smaller percentages. If the BoatUS values are any good, it seems boats depreciate faster than owners are willing to acknowledge, especially as they reach 10-15 years old. Asking prices for the mid 90's boats were 30% or more high, while the late 90's and '00 boats were only about 10-15% over the Boat US values.

I haven't personally looked at all of these boats, but the ones I have looked at could not be considered much above average (and some would take wads of cash to make average). Personally, I'd be willing to pay a premium on a 10 y.o. boat for things like newer sails, replaced standing/running rigging, etc.. Stuff like 10 y.o. chartplotters, dodgers, biminis, and air conditioners have seen a lot of use, and in my mind should not command a huge premium.


----------



## 121Guy (May 6, 2007)

Midlife,

It is always interesting determining fair value for a large item, be it a boat, house, car, land etc. All one can really do is rely on expert opinion and past history of sales. Who is an expert? Not the listing price broker. Not the asking price owner. Not an emotional buyer. In my way of thinking, the Boat US program makes lots of sense as they do not play on only one side of the transaction. If you want to sell, you can call them. If you want to buy, you can call them. If you do use them, an interesting point is that, I believe, they will not insure for more than they estimate. 

For a large selection of all types of boats, I'd look hard at the Detroit market area. Combination of fresh water, short seasons and really bad local economy have created a very good buyers market. You will have to beat away all the Canadians though.

Good luck!


----------



## xort (Aug 4, 2006)

A really bad local economy means people start shortcutting on maintenance.
I'm in the Detroit market & I got 15% over estimated value. But it was in very good cosmetic condition.


----------

