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Old 28-10-2014, 08:47   #31
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Re: Outremer 45

... What Brad said!!
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Old 28-10-2014, 15:10   #32
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Re: Outremer 45

skipped ahead, but the manufacturers that build to quality not quantity will have a much higher resale. You, Scarlet, as a novice as well as myself can tell the quality differences between the assembly line and the niche market. I consider PDQ, Outremer, Chris White and a few others as quality not quantity. I will also say, that Catana has started to fold to the dark side of the mass produce and after my visit to the boat show">Miami boat show early this year, I'm hoping Outremer stays out of that game.

This is a novice opinion and I mean no harm to anyone that owns a mass produce. The woman in charge loves the Lagoon flybridge and roominess, so that's the route I'll be sailing one day But I will dream of a Chris White until I die or she gets rid of me!!!
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Old 29-10-2014, 14:38   #33
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Re: Outremer 45

Blue Skye, its not just the quality of the boats you mention that reduces depreciation (although it does, as they tend to hold up better over the years), but the fact that they were never sold in significant numbers to the bareboat charter industry. This means that the market is not flooded with used versions after four or five years.

Looked at another way, let's assume that only 50% of all new cats are sold as 'owner's versions', with the other 50 % going into bareboat charters. Let's assume that the boats you mention, which are not intended for the bareboat charter market, make up 20 per cent of the remaining sales that are made to private owners, while only 10% of the overall new sales.

After 5 years pass, it is likely that 20% of the people looking to buy a used crusing cat for personal use will still be interested in these boats. Hence, supply will likely equal demand. However, in the case of the cats where 50% of the new sales were for bareboat charter, as they come on the market there are apt to be twice as many of these boats available than there were people interested in buying them for personal use in the first place. The result: the price point has to drop more significantly in order to meet with the demand.

Brad
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Old 29-10-2014, 16:09   #34
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Re: Outremer 45

Nice theory. Not sure it applies in practice.

The price point for ex charter boats will definitely drop and therefore ON AVERAGE bring the price of that particular model of boat down. However, the reality is that many if not most personal buyers want owner versions and they will pay extra to obtain such a model.

Eventually, I am interested in upgrading to a faster boat with similar comfort so I have taken a keen interest in the second hand market for these "upmarket" boats, and I have found that they depreciate similarly to production boats. I suspect that the main reason for this is that there are very few buyers at these price points.

As to the points in regard to the inflationary cost of money, I have found average GDP to be a good indicator, this currently running at around 3.5%.

For instance if Scarlett determined that a cruise ready owners version Helia depreciated 40% over 5 years to say U$450K (a not unreasonable assumption), then you would have to add around 20% (3.5% compounded over 5 years) or U$90K to allow for inflation over that period.

Certainly, if I look at boats now for sale that are 5 years old and compare to their price new 5 years ago this seems about right.
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Old 29-10-2014, 18:08   #35
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Re: Outremer 45

A data point: I believe I can sell my boat for about what I paid for it eight years ago, if not a little more. When I bought it at five years old, the original owner got what he paid for it new. This is based on what the same models and ages are selling for today. In an insurance survey last year this time, it was valued at $80,000 more than what I paid for it.

But, I have put a LOT of money into it in the meantime, and still am, and plan to continue to do so.

2 Hulls Dave
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Old 29-10-2014, 18:28   #36
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Re: Outremer 45

Quote:
Originally Posted by 2Hulls View Post
A data point: I believe I can sell my boat for about what I paid for it eight years ago, if not a little more. When I bought it at five years old, the original owner got what he paid for it new. This is based on what the same models and ages are selling for today. In an insurance survey last year this time, it was valued at $80,000 more than what I paid for it.

But, I have put a LOT of money into it in the meantime, and still am, and plan to continue to do so.

2 Hulls Dave
This pretty much exactly describes our boat also. We bought it five years old for close to what the owner paid new, and sister ships are selling now for the same price we paid.

Mark
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Old 29-10-2014, 18:59   #37
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Re: Outremer 45

People here saying that (non defined) quality boats lose less value compared to (non defined) mass market boats.

IF (!!!) you happen to mean new vs. old.

Can you PLS post links to relevant data?

I did a study (not truly in depth and not truly very recent) where I found there is no such relationship.

I was comparing 6-7 y.o. Bavarias vs. HRs and I found that HR's lost more value (as percentage of the 'new' price).

True, older "quality" boats seem to be losing less value in consecutive years (which will make sense if their built and materials were better). But as someone who has friends waiting to sell their $$$ boats I can assure you asking prices as visible at brokerage pages say nothing about actual lack of demand for these boats at these prices. In a word, you lose more when you sell an old Bavaria, but you sell it sooner.

Cheers,
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Old 29-10-2014, 19:17   #38
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Re: Outremer 45

Used boat prices will fluctuate in lock step with new boat prices. Right now, new boats prices are up, hence used boat prices are up.
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Old 29-10-2014, 19:47   #39
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Re: Outremer 45

You also have to factor exchange rate in these discussions. Depreciation of the Euro vs US will have a massive effect on the value of French built boats new and second hand.
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Old 30-10-2014, 02:30   #40
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Re: Outremer 45

Some good real life experience from Mark and Dave. Yes exchange rates play a major role, as well as registration and tax as previously mentioned and broker fees. These alone can add up to 30%. You can't do anything about exchange rates, that's luck of the draw when you buy and sell, but you can do a lot to reduce tax and broker costs, as well as delivery costs.
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Old 30-10-2014, 06:28   #41
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Re: Outremer 45

Quote:
Originally Posted by monte View Post

(...) You can't do anything about exchange rates, that's luck of the draw when you buy and sell, (...)
Yes, one can.

- buy FX options / futures,
- start buying the desired CCY prior to buying the boat (this is not good as the above since you can only hedge one way with hard currencies).

Cheers,
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Old 30-10-2014, 07:05   #42
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Re: Outremer 45

Quote:
Originally Posted by barnakiel View Post
People here saying that (non defined) quality boats lose less value compared to (non defined) mass market boats.

IF (!!!) you happen to mean new vs. old.

Can you PLS post links to relevant data?

I did a study (not truly in depth and not truly very recent) where I found there is no such relationship.

I was comparing 6-7 y.o. Bavarias vs. HRs and I found that HR's lost more value (as percentage of the 'new' price).

True, older "quality" boats seem to be losing less value in consecutive years (which will make sense if their built and materials were better). But as someone who has friends waiting to sell their $$$ boats I can assure you asking prices as visible at brokerage pages say nothing about actual lack of demand for these boats at these prices. In a word, you lose more when you sell an old Bavaria, but you sell it sooner.

Cheers,
b.
Dave and I posted data for two specific model of boats. Both of these were relatively limited run production boats and considered some of the best boats from the builder. While the C471 was used in charter, it was not a mass-charter boat, and was primarily built and sold as an owner's version. Both of these boats are relatively rare on the used market at any time - particularly when compared to Lagoons, FPs, Leopards, Voyage, etc.

So I think these are the keys to holding resale value - 1) a good cruising design and build quality 2) known production manufacturer 3) limited number of boats in the model run, yet enough boats to be well-known 4) not used primarily in charter.

Of course, inflation hasn't been considered in Dave or my examples. The boats sell for the same price we paid, but that money isn't as much now as it was then.

Mark
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Old 30-10-2014, 07:22   #43
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Re: Outremer 45

Exactly Mark. Although I from my experience FP and lagoon are in the same boat so to speak.
Barni, yes you can lock in the rate, but wether that's profitable is what you can't do much about.
Example, I locked the rate when I ordered my first boat and lost 20K as a result if the Aussie dollar strengthening against the euro
I didn't lock in the rate on my next boat and lost 20K on the deal as the AUD dropped.
If you can tell me which way the exchange will go for the next boat purchase I'd greatly appreciate it!
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Old 30-10-2014, 10:26   #44
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Re: Outremer 45

Quote:
Originally Posted by colemj View Post
(...) The boats sell for the same price we paid,

(...)
THX

OK. Now I understand very short production run quality boats become collector's items and with supply next to non existent any demand will keep the prices well above what we see with normal goods. This makes sense.

This also to some extent explains why the Bougainvillea I like so much gets further and further away from us ;-)

Cheers,
b.
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Old 30-10-2014, 10:36   #45
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Re: Outremer 45

Quote:
Originally Posted by monte View Post

(...)

Barni, yes you can lock in the rate, but wether that's profitable is what you can't do much about.

Example, I locked the rate when I ordered my first boat and lost 20K as a result if the Aussie dollar strengthening against the euro
I didn't lock in the rate on my next boat and lost 20K on the deal as the AUD dropped.
If you can tell me which way the exchange will go for the next boat purchase I'd greatly appreciate it!
It is not done to profit. It is done to avoid "loss" (=adverse FX shift). This is different from the situation when you buys options without holding (or intention of holding) the underlying.

If the underlying moves in the opposite (than hedged) direction, you make up on the underlying what you lose on the contract. Google APT for more details.

Seeing the numbers of Aussies and Kiwis passing by with their Med purchased ex charter (or ex tax avoidance) boats, it is easy to tell where the FX rate is right now and make an insightful FX decision.

b.
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