Cruisers Forum
 


Join CruisersForum Today

Reply
 
Thread Tools Search this Thread Rate Thread Display Modes
Old 04-04-2019, 15:38   #1
Registered User

Join Date: Mar 2012
Location: North Carolina
Boat: Seaward 22
Posts: 749
Depreciation Curve on Production Boats?

What is the depreciation curve like on the average 35-40 foot production sailboat (Hunter, Bene, Catalina)? I'm thinking the value drops fairly quickly for the first 5-10 years and then the value stabilizes. After a certain number of years the price is much more about maintenance, equipment, and location.

Anyone done any research?

Thanks in advance and fair winds,

ODB
__________________

ohdrinkboy is offline   Reply With Quote
Old 04-04-2019, 15:49   #2
Registered User
 
Kenomac's Avatar

Join Date: Jan 2012
Location: Pangaea
Posts: 10,587
Re: Depreciation Curve on Production Boats?

It takes a huge dive, then keeps on going. The price never stabilizes, except for some 1980’s Baba sailboats, which for some reason go for about half their original cost today... which is weird considering their cast iron tanks. My point is... there are some exceptions. Boats are just like cars, except there’s no such thing as a collectable antique that increases in value.
__________________

Kenomac is offline   Reply With Quote
Old 04-04-2019, 16:58   #3
Are you serious?
 
sailorboy1's Avatar

Cruisers Forum Supporter

Join Date: Jul 2007
Location: On the boat somewhere
Boat: Hunter 410
Posts: 15,007
Re: Depreciation Curve on Production Boats?

I got my 2001 Hunter in 2010. Today well maintained boats of my model at selling at almost the same price I paid in 2010.

So it just depends
__________________
jobless, houseless, clueless, living on a boat and cruising around somewhere
sailorboy1 is offline   Reply With Quote
Old 04-04-2019, 18:03   #4
Registered User
 
leftbrainstuff's Avatar

Join Date: May 2011
Location: San Francisco and Australia
Boat: Liberty 458
Posts: 2,173
Re: Depreciation Curve on Production Boats?

Steep
leftbrainstuff is offline   Reply With Quote
Old 04-04-2019, 19:11   #5
Marine Service Provider
 
boatpoker's Avatar

Join Date: Nov 2008
Location: Toronto, Ontario or Bahamas
Boat: Benford 38 Fantail Cruiser
Posts: 3,749
Re: Depreciation Curve on Production Boats?

Not sure if attaching a pdf. will work here but I've tried to attached the "Martin Depreciation Scale" used by surveyors and appraisers. it is not definitive and there are a few other methods. A good surveyor/appraiser uses and considers all available methods/information to arrive at a value.
Attached Files
File Type: pdf Martin Scale.pdf (30.6 KB, 785 views)
__________________
That hysterical laughter you hear as you sail a way in your "new" boat ..... is the seller.
boatpoker is offline   Reply With Quote
Old 04-04-2019, 20:48   #6
Registered User

Join Date: May 2018
Location: Us: Australia, Boat: Caribbean
Boat: 50' Ligure power cat
Posts: 118
Re: Depreciation Curve on Production Boats?

Hmm, how does that work with currency depreciation?
So a 20yr old boat is worth 36% of new, but would that be 36% of the original asking price (which if deprecitation is 3% CAGR would be now worth 55% more) or of the current (at sale) price?

So a 20 year old boat worth $150k, was 20 years ago new for $417k, but now would sell new for $750k purely because of economic and currency depreciation.

But I presume that the deprecitation figures in the scales are based on sales figures, which themselves take into account currency depreciation at the time of sale. So instead of the currency and item depreciation events being independent, they are dependent and thus the simplicity of CAGR won't work...
bluenomads is offline   Reply With Quote
Old 04-04-2019, 20:54   #7
Moderator
 
Jim Cate's Avatar

Join Date: May 2008
Location: cruising SW Pacific
Boat: Jon Sayer 1-off 46 ft fract rig sloop strip plank in W Red Cedar
Posts: 14,664
Re: Depreciation Curve on Production Boats?

BP, I see at the top of the graph the term "current replacement value". Does that mean what a similar new boat would now cost? If not, just what does it mean... I'm kinda ignorant about such terminology.

Jim
__________________
Jim and Ann s/v Insatiable II now northbound, lying Newcastle till the gales subside
Jim Cate is offline   Reply With Quote
Old 04-04-2019, 22:38   #8
Registered User

Join Date: Mar 2018
Location: New Zealand
Boat: 50’ Bavaria
Posts: 815
Re: Depreciation Curve on Production Boats?

That’s a very difficult calculation. A boat that cost $600k 20 years ago over here has a current equivalent that’s not far from $700k now, but it’s a way slicker boat with very different gear on it. “Replacement” is a tricky call, as a new boat from the same manufacturer of the same size will be a substantial upgrade, usually.

But to answer the OP, there is a continuous drop from a “near new” (2010s) boat to “good condition used” (2000s) to “older” (1990s) to “old” (1980s). By the end of this scale the value is entirely dependent upon maintenance — a well-maintained 1970s/80s boat still has value, but one that’s been let go could easily not be worth throwing money at and end up being a liability that needs getting rid of...
Tillsbury is online now   Reply With Quote
Old 05-04-2019, 02:24   #9
Moderator
 
Dockhead's Avatar

Cruisers Forum Supporter

Join Date: Mar 2009
Location: Cowes (Winter), Helsinki (Summer); Cruising the Baltic Sea this year!
Boat: Cutter-Rigged Moody 54
Posts: 24,523
Re: Depreciation Curve on Production Boats?

Quote:
Originally Posted by Jim Cate View Post
BP, I see at the top of the graph the term "current replacement value". Does that mean what a similar new boat would now cost? If not, just what does it mean... I'm kinda ignorant about such terminology.

Jim

Yes, it is tracking the value versus the cost today, not the original price.


You can't compare the today value in today dollars to the original cost in 2010 or 2000 dollars. That's apples to oranges. As time goes by, the price goes up in nominal dollars, with inflation, and down due to depreciation. You need to factor out the inflation, to see how much real value is lost.


"My boat is worth nearly what it cost new" is not really true -- not in 2000 dollars or whatever. You're trying to take inflation to the bank. That only works if you have a mortgage.


Query however whether these tables take into account equipment. The new price of boats may be only 80% or 70% of the total real cost, after they get properly equipped. Is the value of this equipment taken into account? It's one reason why some people prefer to buy boats two or three years old -- when you consider the cost of the equipment, the depreciation hit can be massive.
__________________
"Parce que je suis heureux en mer, et peut-ętre pour sauver mon ame. . . "
Dockhead is offline   Reply With Quote
Old 05-04-2019, 05:00   #10
Registered User

Join Date: Dec 2012
Location: Jacksonville, Florida
Posts: 59
Re: Depreciation Curve on Production Boats?

I study this repeatedly in the course of my work. Assuming a vessel is still desirable, a reasonable current replacement cost can be found (minus the bling), normal maintenance and wear and tear then, 8% per year seems to match up with what people are willing to pay. Low volume built to order might only be 5% to 6% but also benefit from that type buyer doing better than average on care and maintenance.

The older the boat the more complicated it becomes due to rebuilds/upgrades or lack thereof. Well informed buyers are willing to add back in 30% or so for expenditures of that type. Others who do not know better will not and in many cases those that do will not either! They are just more willing to buy your boat if it is in good shape.

Boats that have fallen way behind become unsellable unless they have some provenance. During a downturn they all become unsellable.
bglad is offline   Reply With Quote
Old 05-04-2019, 08:40   #11
Registered User
 
MartinR's Avatar

Join Date: Feb 2015
Location: Sweden, boat in Greece
Boat: 73´ULDB custom ketch
Posts: 833
Re: Depreciation Curve on Production Boats?

Very steep

Steeper for charter boats than for owners versions. Catamarans do better at the moment, but that will also change when more charter boats hit the market.
MartinR is offline   Reply With Quote
Old 05-04-2019, 08:57   #12
Registered User
 
Dooglas's Avatar

Join Date: Sep 2010
Location: Oregon City, OR
Boat: 37 Uniflite Coastal Cruiser
Posts: 446
Re: Depreciation Curve on Production Boats?

While initial depreciation is steep, cruising boats are a very different discussion than cars. The typical cruising boat has many upgrades and equipment additions after it leaves the factory. Its resale value is shaped to no small degree by how it is equipped and how well it has been maintained. Two 10 year old factory boats of the same model can easily differ from one another in value by 50%.

I agree with Kenomac. The price never really stabilizes. Depreciation can certainly slow for an older boat if it is consistently well maintained, but a 1971 Columbia 34 is still a 1971 sailboat and it is getting older every year.
Dooglas is offline   Reply With Quote
Old 05-04-2019, 10:44   #13
Registered User

Join Date: Dec 2011
Posts: 896
Re: Depreciation Curve on Production Boats?

I bought my used 2011 model for about 60% of the new sticker price. My last survey was $5,000 more than I paid for it used. Nothing major done in the interim, same engines, same get-set, no electronics upgrades.
jmschmidt is offline   Reply With Quote
Old 05-04-2019, 10:54   #14
Writing Full-Time Since 2014
 
thinwater's Avatar

Join Date: Nov 2008
Location: Deale, MD
Boat: PDQ Altair, 32/34
Posts: 6,351
Re: Depreciation Curve on Production Boats?

I've owned 4 multihulls (beach cat, Stiletto 27, PDQ, Corsair), and after 10-15 years all had stabilized at their original sale price. Obviously, you are loosing the time value of money and up-keep. Additionally, these were kept in very good condition.


  • Condition. The older the boat, the more important.
  • Supply and demand. In general, the boat needed to have been either of very high quality or have some unique characteristic.
In general, the better the boat, the less it depreciates.
__________________
Gear Testing--Engineering--Sailing
http://sail-delmarva.blogspot.com/
thinwater is offline   Reply With Quote
Old 05-04-2019, 10:57   #15
KTP
Registered User

Join Date: Mar 2010
Posts: 316
Re: Depreciation Curve on Production Boats?

Newer boats *may* use cheaper materials in some places though.

I doubt many are using bronze hatches with solid lockdowns anymore while I know a lot are using cheap plastic hatches. Plastic interior vs solid hardwoods. Things like that which are harder to put a value on.
__________________

KTP is offline   Reply With Quote
Reply

Tags
boat

Thread Tools Search this Thread
Search this Thread:

Advanced Search
Display Modes Rate This Thread
Rate This Thread:

Posting Rules
You may not post new threads
You may not post replies
You may not post attachments
You may not edit your posts

BB code is On
Smilies are On
[IMG] code is On
HTML code is Off
Trackbacks are Off
Pingbacks are Off
Refbacks are Off


Similar Threads
Thread Thread Starter Forum Replies Last Post
Production Boats vs Custom Boats seaturkey Monohull Sailboats 64 07-01-2015 07:23
Resale Value / Depreciation Sandero Monohull Sailboats 15 23-04-2009 14:12
What Should I Budget For Depreciation And Transaction Costs meshach Dollars & Cents 6 21-04-2009 10:05
Financing Older vs Newer Boat - Eventual Depreciation swabbmob Dollars & Cents 33 11-07-2008 03:31
Depreciation/Maintenance ??? Lightfin Monohull Sailboats 7 28-11-2005 17:25



Copyright 2002- Social Knowledge, LLC All Rights Reserved.

All times are GMT -7. The time now is 13:12.


Google+
Powered by vBulletin® Version 3.8.8 Beta 1
Copyright ©2000 - 2019, vBulletin Solutions, Inc.
Social Knowledge Networks
Powered by vBulletin® Version 3.8.8 Beta 1
Copyright ©2000 - 2019, vBulletin Solutions, Inc.

ShowCase vBulletin Plugins by Drive Thru Online, Inc.