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Old 10-10-2010, 09:50   #1
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Buyer's Market or Seller's Market ?

I would like to take a survey of the readers on this web site to see what people believe about the current state of the boat market place. I have read numerous posts here that go both ways, i.e.: It is currently a buyer’s market and it is currently a seller’s market. There are a lot of factors in play right now that are controlling the current market that have not been seen in decades. I am aware of this for two reasons. One I am a former yacht broker and I still have numerous friends that I keep in touch with that are both brokers and new boat dealers and they are constantly telling me their tales of woe. Two I just spent the last 8 months researching the market and buying a boat. The main reason it took me so long to find my current boat is the ridiculous number of boats for sale in my $50k - $150k price range. I had never seen anything like it including the period of recession when we had luxury tax on boats. My wife and I looked at hundreds of boats on line, 25 in person, and made 10 offers. This did not include sight unseen offers on bank repos where we made another 5 ridiculously low offers that we were out bid on. Although on one $250,000 sailboat our $40k offer was only $5k short of winning it. I would like to hear from people in North America mostly only because that is the market I am in touch with personally, but Europe and other places might be interesting too. This might also be useful info for people out there who are shopping right now and are just getting started. So go ahead and vote. Buyer’s market. Or. Sellers market
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Old 10-10-2010, 10:10   #2
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In my first year listing and selling boats, I am blessed that I am doing it as a moon lighting gig. I find brokers trying to keep the price up when listing to maintain boat values as much as possible. Keeping values up benefits the owners, and yes after you are the buyer you are now the owner and you want your value to be preserved as well.

My vote right now Buyers market. There are too many forces in our new economy that dictate this. Even so, I am not seeing what I would consider low ball offers. I am seeing boats sit for a long time if the vessel is not priced well or if the vessel is too much of a project.

This is what I notice mostly, no one wants a project. They like the low price but are not interested in the can of worms. I wonder how much Forums have to do with this trend. There are so many outlets to get opinions these days that buyers are able to do much more research (a good thing) than in the past.

$45K for a $250K boat, care to share more details to enlighten the curious?

Greg Luce
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Old 10-10-2010, 11:09   #3
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The UK market is quite buoyant at the moment because changes in the UK to Euro exchange rate means Europeans have been buying up clean tidy late production boats, so less choice for everyone else.

So you have made 15 offers on boats in the last 8 months and none have been accepted. I would suggest your offers are either too low or the market isn't as bad for the type of boat your looking for or both. Whilst people might be hurting they aren't going to give boats away unless its absolutely necessary. Also since they are portable, the market is huge, but you know this, you used to be a broker.

Would love to see what boat was valued for $250k and sold for $45k.

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Old 10-10-2010, 11:24   #4
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Not 4 months ago I sold a 23,500.00 Buyer Appraised valued Sea Ray for less then 9K...7K cash to me..I think the brokerage made about 1200.00 after deducting their yard storage bill from their commission ....So much for the second happiest day in your life theory..

Definitely a buyers market.
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Old 10-10-2010, 11:34   #5
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Quote:
Originally Posted by Pete7 View Post
The UK market is quite buoyant at the moment because changes in the UK to Euro exchange rate means Europeans have been buying up clean tidy late production boats, so less choice for everyone else.

So you have made 15 offers on boats in the last 8 months and none have been accepted. I would suggest your offers are either too low or the market isn't as bad for the type of boat your looking for or both. Whilst people might be hurting they aren't going to give boats away unless its absolutely necessary. Also since they are portable, the market is huge, but you know this, you used to be a broker.

Would love to see what boat was valued for $250k and sold for $45k.

Pete
+1

Went into the market last year with the better part of a million dollars in cash to spend and expected the whole market to be at my feet. Boy was I wrong!!! Take a number and stand in line, was the usual response, and low offers -- that is, less than 10% below the asking price, were met with derision. Ended up buying a boat right at the asking price with no discount, but the boat was priced well in the first place.

Don't notice any seller's market here.
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Old 10-10-2010, 11:38   #6
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I'm not in the business yet know many who are. Florida Brokers are having a bad time of it. Buyers market for sure
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Old 10-10-2010, 11:39   #7
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+1

Went into the market last year with the better part of a million dollars in cash to spend and expected the whole market to be at my feet. Boy was I wrong!!! Take a number and stand in line, was the usual response, and low offers -- that is, less than 10% below the asking price, were met with derision. Ended up buying a boat right at the asking price with no discount, but the boat was priced well in the first place.

Don't notice any seller's market here.
Dockhead....I just elevated you to ..."Sir" status ....LOL..


They would have been over here...you should have took a plane ride.
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Old 10-10-2010, 12:03   #8
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Quote:
Originally Posted by Dockhead View Post
+1

Went into the market last year with the better part of a million dollars in cash to spend and expected the whole market to be at my feet. Boy was I wrong!!! Take a number and stand in line, was the usual response, and low offers -- that is, less than 10% below the asking price, were met with derision. Ended up buying a boat right at the asking price with no discount, but the boat was priced well in the first place.

Don't notice any seller's market here.
Actually, you've just described a seller's market, Dockhead . . . which means that the sellers hold the power, and a buyer can take it on the seller's terms or move along, because there's someone else willing to do so.

A buyer's market is just the opposite - the inventory of unsold vessels is large and growing, buyers hold the power and, if they're making good offers, they're steeply discounted from the asking prices. If sellers want to make a sale, they must accept the buyer's terms or lose the sale, because there's another seller willing to be more conciliatory.

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Old 10-10-2010, 12:45   #9
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Buyers market.

Has always followed economic depressions/recessions.
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Old 10-10-2010, 12:55   #10
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Dunno. USA has been out of recession since the end of the First Quarter 2009.

What Dockhead may have found is that fewer people put a high value boats on the market during a recession therefore little supply prices go up. Then when the know the market is going up after the recession they flood the market and the prices go down. Same as houses.

Difficult to pick because we normally only know when we came out of a recession 3 to 6 months later (the end of the next quarter) and the media is still preaching gloom and doom for the next few months...

If you need a merket indicator: You're in boom times! Be happy 2.5% growth is good
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Old 10-10-2010, 13:14   #11
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It definitely is a buyer's market and will continue for quite a time. Brokers and sellers have a hard time convincing me of their inflated values of their items when I can find a specific boat, i. e. Catalina 22 from $2K to $22K. That's just an example. High end boats have quite a spread in prices as well and if you just shop through brokers or on Yacht World or pick the ads in the back of Sail or Cruising World then you are not going to find the real bargains.
The value of an item is only as high as what the seller is willing to take for it.
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Old 10-10-2010, 13:14   #12
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My instinct would be that the market for million dollar boats would be quite different than the market for <100k boats.

For small boats, it seems like it's always a buyers market.
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Old 10-10-2010, 13:21   #13
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I don't think there is a question in anyone's mind. It is a buyer's market. I'm seeing sellers ask for little and get less, if anything. One boat on my pier has been for sale at a premium price for almost two years. A few weeks ago he cut his price by more than half and the boat is still in the slip with no takers. The slip even comes with the boat. And this is a marina that has a waiting list several years deep of folks trying to get in.
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Old 10-10-2010, 13:25   #14
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There are two types of owners I've seen:

a) Owner who can keep paying money for slip fees and maintenance and/or who has a loan out or otherwise is making sure they sell for "x" in order to get the amount they want out. These boats stay for sale for a long time.

b) Owner can't afford payments anymore or is leaving. I knew a guy who was leaving for a job in Alaska and had to get away from the boat. Another guy was going to be crewing a boat in Tahiti and had to get away. Both of those guys ended up giving the boat away. The Alaska guy bought for ~20K and sold for ~2K, and the Tahiti guy sold a $40K boat for $1K.

Sometimes people need to get away from boats fast and they'll do anything just to release their own liability. If you can find yourself in one of those situations you can get a really nice boat for almost nothing.

The other thing I've noticed is that the kind of owner who has the financial means to keep the price high is also the kind of owner who probably performed regular maintenance, didn't defer maintenance, and did proper installs.
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Old 10-10-2010, 13:26   #15
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Dunno. USA has been out of recession since the end of the First Quarter 2009.

What Dockhead may have found is that fewer people put a high value boats on the market during a recession therefore little supply prices go up. Then when the know the market is going up after the recession they flood the market and the prices go down. Same as houses.

Difficult to pick because we normally only know when we came out of a recession 3 to 6 months later (the end of the next quarter) and the media is still preaching gloom and doom for the next few months...

If you need a merket indicator: You're in boom times! Be happy 2.5% growth is good
Yea well...........
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