how realistic are the prices on boat classified sites?

[ers61]

I see many few years old boats selling above their new price (even though with the equipment priced in) or some boats seems like don't depreciate. when I talked to owners they seem to be ok with lower offers but not much seems to me that most is at least pricing %20-%30 above their price in their heads so that it's open for negotiations? can someone shed light about the market dynamics ? especially the catamarans market. I read here that the storms effected the market and prices went up and queues happened but is it still the case now as of December 2019? I try to depreciate the boats like %20 first year and then %10 for each year.. so for 5 year boat price should be around half of it's new price with same equipments etc. but this doesn't seem to be case for adverts. how do you price a second hand boat ?

[Caribbeachbum]

Lots of variables apply. Age is a factor, but condition is a bigger one. A very well cared for boat will sell for a lot more than the same boat in shabby condition. Some owners build in negotiation room, others try to price the boat to the market. We've just sold ours, for example, for less than I think we could have gotten with more patience. My wife wanted it gone, so we let buyers play (and win) nickel-and-dime with us. Simply put, outside of the first few years since new, there is no good formula for depreciating a yacht. Spend time looking at lots and lots of boats, watch for what they sell for, and get a feel for it.

[UFO]

Look for Wiley Sharp on Youtube a US Broker who runs through pricing each quarter and has given links to sold boat data worldwide for the last few years for Cats.


Only Broker listed sales so no private information and the data is reliant on what the selling broker puts in.


I just sold a boat for asking price in 2 days - It was priced at what I felt was a very realistic asking price for the age and condition of the boat. Also just purchased a Cat and paid within 10% of asking price - Cat was pristine with lots of recent upgrades, as well as being reasonably priced for what was on offer in my estimation.


You will need to spend some time checking out pricing online and viewing as many boats as possible to get a feel for things.

[Mystic38]

i think you are trying to simplify something that simply cannot be simplified... for example, a one year old pristine example of a newly introduced vessel with a two year wait list could well sell for 20% ABOVE list price.. assuming that you actually can access the real list price given its easy to rack up $100k of options without trying..

Supply & demand, age and condition are the things that affect prices.. so if you have an interest in a particular model, speak to a broker who can access the sold prices, or just watch like a hawk for a sustained period

[Vasco]

Originally Posted by Mystic38

i think you are trying to simplify something that simply cannot be simplified... for example, a one year old pristine example of a newly introduced vessel with a two year wait list could well sell for 20% ABOVE list price.. assuming that you actually can access the real list price given its easy to rack up $100k of options without trying..

Supply & demand, age and condition are the things that affect prices.. so if you have an interest in a particular model, speak to a broker who can access the sold prices, or just watch like a hawk for a sustained period

Sums it all up. There is no formula. Want a boat? Pay the going price. If your offer is accepted, that's the going price.

[skipmac]

Originally Posted by Vasco

Sums it all up. There is no formula. Want a boat? Pay the going price. If your offer is accepted, that's the going price.

I'll agree as well. From a former yacht broker.

[cortezsailor]

Lots of thing effect pricing as well . Location is one , buying in a spot like La Paz or wherever people cruise to and don’t want to sail boat back for instance . Type of boat and rep . A mediocre 70 ‘s Valiant with blisters can still get close to 100 g . So many factors to consider but I tell people to offer 60% of asking price

[ramblinrod]

Originally Posted by ers61

I see many few years old boats selling above their new price (even though with the equipment priced in) or some boats seems like don't depreciate. when I talked to owners they seem to be ok with lower offers but not much seems to me that most is at least pricing %20-%30 above their price in their heads so that it's open for negotiations? can someone shed light about the market dynamics ? especially the catamarans market. I read here that the storms effected the market and prices went up and queues happened but is it still the case now as of December 2019? I try to depreciate the boats like %20 first year and then %10 for each year.. so for 5 year boat price should be around half of it's new price with same equipments etc. but this doesn't seem to be case for adverts. how do you price a second hand boat ?

Boat valuation is fairly complex.

The FMV (fair market value) of a boat is based on a willing buyer and willing seller, neither unusually motivated to transact, the average selling price of that boat model, year, make, model, condition, and location. Condition is the wild card. How well has the original boat been maintained (kept from deteriorating). How well has the boat been upgraded (equipment additions from original)?

To arrive at FMV, we review asking price on major ad sites (eg Yachtworld, sailboat listings, etc.) and deduct 10% to estimate the avg sell price, and then add premiums for attributes above average, and discounts for deficiencies below average.

This establishes a specific value. We come very close to actual sell price most times.

Sites like NADA value or BUCNET come up with avg selling prices based on different “condition” categories from “Bristol” to “Poor”.

One really needs to start with average selling price, as some makes and models hold value better than others.

PM me if you would like a professional value opinion, for a particular vessel (based on ad details and photos) which you would then need to verify are actually a fair representative of the boat in question.

[ramblinrod]

Originally Posted by ers61

I see many few years old boats selling above their new price (even though with the equipment priced in) or some boats seems like don't depreciate. when I talked to owners they seem to be ok with lower offers but not much seems to me that most is at least pricing %20-%30 above their price in their heads so that it's open for negotiations? can someone shed light about the market dynamics ? especially the catamarans market. I read here that the storms effected the market and prices went up and queues happened but is it still the case now as of December 2019? I try to depreciate the boats like %20 first year and then %10 for each year.. so for 5 year boat price should be around half of it's new price with same equipments etc. but this doesn't seem to be case for adverts. how do you price a second hand boat ?

BTW, based on your formula, 20% initial depreciation and 10% / year annual depreciation on original price, would make every 9 year old boat free. Clearly this is not the case, or nobody would buy a new boat because of the wicked depreciation AND because everybody could walk away with a 9 year old boat in average condition, for nothing.

[ers61]

Originally Posted by ramblinrod

Boat valuation is fairly complex.
PM me if you would like a professional value opinion, for a particular vessel (based on ad details and photos) which you would then need to verify are actually a fair representative of the boat in question.

your private msg is closed so I send it from here: could you have a look at this: https://www.yachtworld.co.uk/boats/2...on-39-3594137/ please let me know what you think in private msg or here . thanks

[redneckrob]

Originally Posted by ramblinrod

BTW, based on your formula, 20% initial depreciation and 10% / year annual depreciation on original price, would make every 9 year old boat free. Clearly this is not the case, or nobody would buy a new boat because of the wicked depreciation AND because everybody could walk away with a 9 year old boat in average condition, for nothing.

Annual depreciation is based on the prior year's value, not the new value. So you buy for $100K it is worth $80k at the end of year 1 (by the stated formula). To get the value at the end of year 2 you multiply $80k by .9, not subtract .1*$100k as you appear to be doing in order to get a value of zero after 9 years. And so on the next year, .9*$72k.....Note how this leads to diminishing absolute depreciation dollar values over time, which I think is consistent with what we see. I don't know that the posted depreciation schedule is accurate, and I've observed folks tend to forget the concept of inflation or the fact that it was much different 20 years ago than today. But at least we should do the math correctly so we can focus on the actual variables.

[ramblinrod]

Originally Posted by redneckrob

Annual depreciation is based on the prior year's value, not the new value. So you buy for $100K it is worth $80k at the end of year 1 (by the stated formula). To get the value at the end of year 2 you multiply $80k by .9, not subtract .1*$100k as you appear to be doing in order to get a value of zero after 9 years. And so on the next year, .9*$72k.....Note how this leads to diminishing absolute depreciation dollar values over time, which I think is consistent with what we see. I don't know that the posted depreciation schedule is accurate, and I've observed folks tend to forget the concept of inflation or the fact that it was much different 20 years ago than today. But at least we should do the math correctly so we can focus on the actual variables.

Agreed that is the way annual depreciation is normally applied, but I have never seen a boat in average condition depreciate as fast as the OP expects.

And again, if they did, nobody would buy a new boat.

The trouble is the value of depreciation, it will vary depending on all of the factors indicated in the prior post. (The location variable includes issues like UV strength (and related damage) and fresh vs saltwater, supply/demand for that area, etc.).

[ers61]

Originally Posted by ramblinrod

Agreed that is the way annual depreciation is normally applied, but I have never seen a boat in average condition depreciate as fast as the OP expects.

so that brings us here to this forum topic.I wonder it..btw this is how I calculate it each year
% 0
80.0
72.0
64.8
58.3
52.5
47.2
42.5
38.3
34.4

so your 9 year old boat is %34.4 of it's price to my undertanding

[redneckrob]

Originally Posted by ers61

so that brings us here to this forum topic.I wonder it..btw this is how I calculate it each year
% 0
80.0
72.0
64.8
58.3
52.5
47.2
42.5
38.3
34.4

so your 9 year old boat is %34.4 of it's price to my undertanding

That's only if you assume those depreciation factors to be true, which is not necessarily the case or even ever the case. I was just pointing out an error in math reasoning so we were all on the same page with what we're talking about.

[Cadence]

Originally Posted by ers61

I see many few years old boats selling above their new price (even though with the equipment priced in) or some boats seems like don't depreciate. when I talked to owners they seem to be ok with lower offers but not much seems to me that most is at least pricing %20-%30 above their price in their heads so that it's open for negotiations? can someone shed light about the market dynamics ? especially the catamarans market. I read here that the storms effected the market and prices went up and queues happened but is it still the case now as of December 2019? I try to depreciate the boats like %20 first year and then %10 for each year.. so for 5 year boat price should be around half of it's new price with same equipments etc. but this doesn't seem to be case for adverts. how do you price a second hand boat ?

I believe how realistic classified ad prices are reflects on how naïve the buyer is.