Boat sales and the coming reccesion.

[Celestialsailor]

I'm posting on a thought provoking topic with the recent increase in boat sales since Covid hit. But with most concerns of the economy, it's not all that simple. In the chart below you can see how the S&P is closely tied to boat sales...





Next you can see in this graph how close we are to the next crash.





There is a direct correlation to recessions, S&P 500 and boat sales.


I thought maybe people would have some input on what may be coming.

[Fore and Aft]

CelestialSailor I don't understand the graph. But what I do know is in the last few months survey enquiries from newbies has fallen of the cliff. I am not complaining as it's been exhausting hearing about the proposed voyage around the world and been talked down to because I don't know xyz YouTube star. Here in Australia lot's of my clients have used home equity loans or sold their house at a big profit to finance the dream. I am interested to see how this all plays out. Its hard to make an income from boats and every month of ownership costs money. So do you cut your losses and sell the boat for a loss? Or do you hang on to it and hope the market improves. Lots of my clients over paid in the last two years and are in for a shock if prices do drop.
Cheers

[Celestialsailor]

Hey F&A...the second graph shows the peak of inflation. This, of course, has one way to go...down. Boat prices were way too inflated. The same is the recent housing market. Those people who bought the last year will be in for a bit of a bummer. Will the prices come back to their purchase price? I don't think so and especially if it was a newer boat. Boats are not like houses where the long term trend is to increase over time. Instead, an old boat is an old boat. We have children that are looking at starting new careers. Two in nursing and one is in the union working on heavy equipment and making tons of money. We're telling them to wait a few years before buying.

I know what you mean about the Youtube chasers. There is no reality. I tell some of the newbies that come on here, that want to sell their house and "live the dream", not to. After they figure it out that all the T&A is only on youtube and it is a hassle maintaining a boat and slip rent and expensive marinas and, and, and. Unfortunately, a lot of them cannot buy back into the housing market.
I'm thinking we'll be seeing a lot of boats for sale come spring.

[Rumrace]

When times are great all luxury items are up. Stock market grafts show how much cash flow is being transferred to China’s economy. It was more exciting when you invested in the little company in town and watched it grow.
The bank of Canada just increased interest rates so just about every Canadian with a mortgage now hands the banks an extra 300-400$ a month. This stems the available disposable income and hands it over to the top profiteers in the land. Great way to hurt luxury sales.
Using the New York stock exchange to gauge future global sales of boats is a view through pink sunglasses.
A great deal of international trade changes kinda make that measuring stick important to only a small portion of the globe.
Japan Canada and Europe are in a free trade union with barriers against enabling poor quality products for undermining honestly achieved perceived values and approvals.
I think it fare to say each country in any trading group will travel their own path through the recession all ready in full bloom.
Recessions have always been great times to grow the business while your competitors cut back service or inventory.
When the US cut off Canadian Aluminum was a big hit on the economies of Quebec and Ontario so build two huge aluminum foil factories and compete with Reynolds and Reynolds instead of complaining about it. Take a look at the aluminum markets today. Expanded new investments.
I think these are exciting times for small and medium sized companies to grab market share off the big corps who come unglued with a slow down in activity. Then the cycle repeats as these great little companies get swallowed up by Multinationals a couple years from now.

[Marinarius]

Originally Posted by Rumrace

When times are great all luxury items are up. Stock market grafts show how much cash flow is being transferred to China’s economy. It was more exciting when you invested in the little company in town and watched it grow.
The bank of Canada just increased interest rates so just about every Canadian with a mortgage now hands the banks an extra 300-400$ a month. This stems the available disposable income and hands it over to the top profiteers in the land. Great way to hurt luxury sales.
Using the New York stock exchange to gauge future global sales of boats is a view through pink sunglasses.
A great deal of international trade changes kinda make that measuring stick important to only a small portion of the globe.
Japan Canada and Europe are in a free trade union with barriers against enabling poor quality products for undermining honestly achieved perceived values and approvals.
I think it fare to say each country in any trading group will travel their own path through the recession all ready in full bloom.
Recessions have always been great times to grow the business while your competitors cut back service or inventory.
When the US cut off Canadian Aluminum was a big hit on the economies of Quebec and Ontario so build two huge aluminum foil factories and compete with Reynolds and Reynolds instead of complaining about it. Take a look at the aluminum markets today. Expanded new investments.
I think these are exciting times for small and medium sized companies to grab market share off the big corps who come unglued with a slow down in activity. Then the cycle repeats as these great little companies get swallowed up by Multinationals a couple years from now.

There's a Freudian slip...

[dhenline]

I have wondered about the real increase in boat prices for the new market.
I am planning on buying a late model used boat or a new boat. I saw alot of you tube reviews on the Seawind 1260, as being a really great boat for under 500K. the reviews were mostly from 2019.
I went to the local seawind dealer and priced one out. about 800K give or take after all the charges. Not even close to 500K. I doubt their build costs went up 50% in the past three years. I will be curious if the new build prices will decrease anytime soon. I understand that many people locked into the price and thus will not see a decrease but I wonder how many will suddenly not take possession.
certainly I am seeing the used boats finally having price decreases and staying on the market longer. No less than about 13 Outremers for sale currently. Certainly wasnt that way one year ago
don

[Celestialsailor]

If you wait a couple of years (or less), All the people that had disposable income to spend on a new 1260, (2019-2021) will be trying to bail out their their essentials and the first thing to go will be the toys.

[Pegu Club]

2nd hand/used boat prices have been dropping for a couple of months from what I’m seeing on the usual on line listing sites, the same is happening to new and used RV sales, so many folk jumped on the band wagon who had no understanding that these things cost money even when your not using them…. and they are all starting to hit the used market, at the same time the demand is dropping back to pre Covid levels, the buyers market is on the way back,

Fair winds,

[MicHughV]

I gotta agree with the sentiments above....I think the bottom is dropping out of the boating market !!

[Celestialsailor]

I do too and as with the human condition, denial will set in..."but, but...I bought it for much more than that". So there might be a lapse for reality to set in. 12 months of slip rent whittles peoples dreams to burden.

[MicHughV]

From my point of view...it's simple....many people have chosen to jump on the " yachting" bandwagon......marina rates have skyrocketed...marina fuel prices are thru' the roof...everybody and anybody is out to make a buck on the "rich" yachtie...etc...etc...etc...it's a downward spiral....even "rich" yachties are sayin' " enuff is enuff"

From where I stand a prospective boat buyer needs to just suck it in for the moment and ride it out until sanity prevails again....

Some years back, Florida enacted a "luxury" tax on boaters, dreamt up by some politician who obviously knew nothing.
Almost overnight, the yachting industry ground to a halt. People, basically said " enuff of this cr*p"
It took years to recover from that debacle.

The reality is that most boaters don't use their sailboat or powerboat that often. It
s an expensive toy, that just degrades on a daily basis. For the most part, the boat spends the majority if it's time tied up to a dock somewhere or parked in someone's driveway, where it incurs monthly dockage charges, insurance, maintenance, etc...etc....and basically just dies a slow death from lack of attention.

After some time the wife is gonna say..time to get ride of dat thing...easier said than done....tough to sell a used, neglected boat in a downward trend....

I don't know how or when this story will unfold, but being a boat buyer in this market is likely frought with problems.

[Rumrace]

I’m not familiar with all the brands you’ve mentioned. You have a broader range of boats you are watching. The price increase in my next boat seems held back since 2019 and finally got a 10% increase. Not unlike any manufacture the real increase might be only 4% but they are making up for losses and pending increases. I wouldn’t say it’s surprising. Even with the price increase new is pretty appealing
I’m waiting for a machine from Czechia. It’s the third machine I’ve bought from them. They had a 15% increase and they are going to be 12 days late. Sign of the times. Their price increase and slower deliveries are totally forgivable. They are one of those companies whom had to get parts from Germany instead of Ukraine to carry on business. I believe most luxury items are taking a beating on margin.

[Celestialsailor]

Originally Posted by MicHughV

From my point of view...it's simple....many people have chosen to jump on the " yachting" bandwagon......marina rates have skyrocketed...marina fuel prices are thru' the roof...everybody and anybody is out to make a buck on the "rich"

From where I stand a prospective boat buyer needs to just suck it in for the moment and ride it out until sanity prevails again....

The reality is that most boaters don't use their sailboat or powerboat that often.

I don't know how or when this story will unfold, but being a boat buyer in this market is likely frought with problems.

Just cherry picking some of your excellent points about the boat market.

I am a different type of buyer. Not many of use around anymore. I have had 9 boats over 36 years. The Pearson 365 I have now, was reportedly rarely used as a sailboat. But had 1000hrs on the engine. Some of that (like many of us) was probably leaving the key to the engine on and the meter clicking a way for who knows how long. The sails are white and crisp and hard to stow...just like a new sail. Both prior owners used it to entertain clients on the SF Bay taking them out for sunset motor cruises. The log only showed engine service intervals. That does not mean that things don't wear out. Refer dead. Mast corrosion at it's base. Black stalactites in the water tanks and all the hoses basically rotted.

During this last craze, the boat had been listed two years ago for $35K. Six months later $30K. Six months later $25k. This is when I started to seriously watch it. A few months later their power boat neighbor clipped the Pearson's bow, wounding the bow roller. They had, had enough and after getting the insurance money, listed her for $20K. I surveyed the boat and offered less and got it.
The broker gave the deal as little intention as possible causing me to continually hound him to do his job. But he had bigger fish to fry and I was always on the back burner. He'll be singing a different tune in a years time when the panic starts.
Point is in my category of boats to buy, cheap ones will, at some point, always be available. You just need cash. I'm only paying $214@month for a slip in Northern Ca. That is because I know where cheap, safe slips are. The prior owners were paying $760@ month where it was before. I've been doing this for 45 years now...buying cheap, selling high, buying a fixer house and later another cheap boat and so on. I've gone cruising a few times and enjoyed that. But mostly I enjoy working on them and hanging out on the docks with like minded people.

[MicHughV]

I don't know what to make of the latest boating scene.

I can only tell you what I see.

I live on the Florida east coast. The ICW is my backyard so to speak. Our local marina and several other marina's in the area have all been bought out by a big conglomerate. Marina rates have been jacked thru' the roof. Transient rates are exorbitant, etc. Insurance companies are loathe to write policies for older boats, and if they write a policy, it will be expensive with high deductibles and then off course, we are in hurricane season.

What it all boils down to is this...." owning" a boat these days incurs quite a steep monthly bill. Dockage, electricity, insurance,
etc, for your basic 40' sailboat tops a $1,000/month these days. If you are a liveaboard, even more. Owning a power boat with dual 300 hp engines is gonna require robbing a bank to put gas in the tank, etc.

Marina's don't have it easy either. They are on the hook for submerged land leases, dredging, bulkhead and dock maintenance, plus a myriad of other concerns, employees and so on. Anchoring restrictions are everywhere, replaced by " mooring fields".

Many marina's are now looking to develop marina real estate and so on.

It's partly economics and partly politics, etc with the average boater stuck in the middle.

It can't go on like this, this is for sure, eventually the bubble will break.

[slowNlow]

Suspect monohull values will crater, cruising multi’s will cool and performance cruising multi’s will remain strong.

Three or four major YouTube(rs) dumping their condos in favor of daggared PC’s reflect a trend and will help drive the market.

Well, perhaps wishful thinking on my part as I have a daggared PCC that I plan to list in october... upgrading to a new PCC.