Will there be a glut of boats for sale once Baby Boomers retire from boating?

[Mike OReilly]

Originally Posted by letsgetsailing3

There are plenty of available boats out there that people aren't buying, even as people spend their money on other things.

Yes, there are lots of boats on the used market — it’s b/c a decreasing number of people are buying them. Why? In part, because up and coming generations are poorer. It’s as clear as the hat on my head in any economic data you care to examine.

Originally Posted by letsgetsailing3

We hear all the time how broke everyone is, even as people buy record amounts of everything, including luxury goods. I'm not sure how boats overall are doing, but they're still making sports/luxury cars. In fact, Ford is basically cutting out the economy cars produced in America in favor of SUVs.

Boat sales have been dropping. Again, the data is clear. I haven’t examined luxury car sales, but I bet it’s down as well (although, I guess it depends on what you mean by “luxury” — an SUV is not necessarily a luxury vehicle).

Here, just took me 20 seconds to search. This shows a clear trend of declining US car sales. It peaked in the late 70s/mid 80s. This is exactly when the great decline in the middle class started to bite.

https://www.statista.com/statistics/...es-since-1951/

Originally Posted by letsgetsailing3

Americans are doing pretty well, in spite of the media narrative that focuses on the people left behind. You know what? There were always people left behind.

Some are, an increasing number are not. Just listen to you current President. It’s what got him elected.

[letsgetsailing3]

Originally Posted by Mike OReilly

Yes, there are lots of boats on the used market — it’s b/c a decreasing number of people are buying them. Why? In part, because up and coming generations are poorer. It’s as clear as the hat on my head in any economic data you care to examine.



Boat sales have been dropping. Again, the data is clear. I haven’t examined luxury car sales, but I bet it’s down as well (although, I guess it depends on what you mean by “luxury” — an SUV is not necessarily a luxury vehicle).

Here, just took me 20 seconds to search. This shows a clear trend of declining US car sales. It peaked in the late 70s/mid 80s. This is exactly when the great decline in the middle class started to bite.

https://www.statista.com/statistics/...es-since-1951/



Some are, an increasing number are not. Just listen to you current President. It’s what got him elected.

It took you about 20 seconds to google that, and was worth about 20 seconds.


There is no clear trend of declining auto sales in that report. What I see is a cycle there of a recovery from the financial crisis of 2007/2008, and an indication that people are choosing SUVs and trucks (which are more expensive, by the way) over smaller passenger cars. So the sales went up during the housing bubble, went down when the bubble crashed in 2007, and went way up in 2014, along with the recovery and more jobs, and then settled lower with the fact that people had just bought a lot of cars that they didn't buy from 2008-2012. At least that's what I see.



I'd suggest it's more that you have a world view already, and that you can selectively interpret data to support it, so it kind of works out for you.



Here's a better article for you to take a look at, as it's about boat sales.



https://www.nmma.org/statistics/article/21974


U.S. Boating Industry Sales at a 10-Year High



U.S. Recreational Boating by the Numbers (Source: NMMA’s 2017 Recreational Boating Statistical Abstract)

• Annual U.S. sales of boats, marine products and services totaled $39 billion in 2017, an increase of 7 percent from 2016.
• There were approximately 262,000 new power boats sold in 2017, an increase of 5 percent from 2016.
• Leading the nation in sales of new powerboat, engine, trailer and accessories in 2017 are the following 10 states, nine of which saw double-digit growth:
  1. Florida: $2.9 billion, up 10 percent from 2016
  2. Texas: $1.7 billion, up 12 percent from 2016
  3. Michigan: $982 million, up 12 percent from 2016
  4. North Carolina: $838 million, up 16 percent from 2016
  5. Minnesota: $807 million, up 12 percent from 2016
  6. New York: $735 million, up 4 percent from 2016
  7. California: $718 million, up 14 percent from 2016
  8. Wisconsin: $713 million, up 12 percent from 2016
  9. South Carolina: $637 million, up 12 percent from 2016
  10. Georgia: $632 million, up 11 percent from 2016
• It’s not just new boats Americans are buying; there were an estimated 988,200 pre-owned boats (powerboats, personal watercraft, and sailboats) sold in 2017, the highest pre-owned boat unit sales since 2006, totaling $9.3 billion in sales, an increase of two percent from 2016.
• There are nearly 12 million registered/documented boats in the U.S. in 2016 (2017 data will be available in July 2018).
• 95 percent of boats on the water (powerboats, personal watercraft, and sailboats) in the U.S. are small in size, measuring less than 26 feet in length—boats that can be trailered by a vehicle to local waterways.
• Boating is predominantly “middle-class” with 62 percent of boat owners having a household income less than $100,000.

Like the article says, though, 95% of boats are smaller than 26 feet.


What we're talking about here are cruising boats, and the market has tended to go larger. As those boats are very expensive when new, and limited numbers of affordable boats are being produced, one might almost think that the used boat market would stay strong.


Maybe there's a perception, though, that older boats aren't seaworthy. Mostly propagated by people who let them sit in marinas instead of using them and keeping them repaired.

[Matt Johnson]

You guys want a low priced sailboat? The new Viko S35 is listing for under $70,000 usd.... A 35' brand new sailboat! Even better, they were offering it for $55,000 for the first few buyers.

VIKO S 35 | VIKO YACHTS

Matt

[LF4]

Just for the fun of it....Lets look at a typical family of 4 in their 30's that is in the top 10% of household income. I use the 30's because this is when many people of my generation start to settle down, have kids, buy the house, and tackle student debt.

Household income floor to get to the top decile: $160,000

after taxes, health care deductions, saving for company match in 401k, etc. it leaves us with about (if we are being generous): $8,300/month

Average mortgage is $313k borrowed at 4.6% over 30 years (including average taxes and insurance costs): $1,700/month

Average student loan debt x2 is $64,000 @ 6% over 10 years: $710/month

Childcare for two children is about $26,000 a year on average = $2,167/month

Average car loan x 2 = $958/month

Average cost of food for family of 4: $909/month

Average Utilities costs: $402/month

Let's leave out things like the arts, credit card debt that averages about $7,000 a month carried at 17%, vacations, savings for emergencies, repairs & maintenance, beauty & hair, all of those little extras. Heck, we didn't even include car insurance because it's not required in every state.

We started with $8,300 a month in disposable income and end up with $1,454 dollars of disposable income. Of course, this isn't one size fits all. Perhaps someone had a scholarship for a degree or their parents paid their way. Perhaps they were gifted a car or decided to buy a used one (we have a used car...and only one car.). Maybe they use flip phones, no cable other than internet, and live in a less expensive 900sqft home. These are all choices that can be made, but they are not what the average person is dealing with.

At the end of the day, if families of four in the top 10% of income are walking around with ~1,454 a month in disposable income, they will not be able to afford a new SAILBOAT. The cost of mooring, maintaining, and the monthly payment won't allow for it.

[Stu Jackson]

Originally Posted by Kenomac

You're blinded by the crappy economy everywhere but in the USA, where the economy happens to be roaring ahead like it hasn't in the past 40 years thanks to Trump. Maybe Canada should elect it's own "Trump" like Italy did last year.

I see opportunity, possibility and prosperity, you seem to only see gloom and doom.

I'm sure you're aware of the Rules of this forum, are you not?


This is a totally uncalled for comment.


As Canadian Permanent Resident, I request you to cease and desist in this nonsense.

[letsgetsailing3]

Originally Posted by LF4

Just for the fun of it....Lets look at a typical family of 4 in their 30's that is in the top 10% of household income. I use the 30's because this is when many people of my generation start to settle down, have kids, buy the house, and tackle student debt.

Household income floor to get to the top decile: $160,000

after taxes, health care deductions, saving for company match in 401k, etc. it leaves us with about (if we are being generous): $8,300/month

Average mortgage is $313k borrowed at 4.6% over 30 years (including average taxes and insurance costs): $1,700/month

Average student loan debt x2 is $64,000 @ 6% over 10 years: $710/month

Childcare for two children is about $26,000 a year on average = $2,167/month

Average car loan x 2 = $958/month

Average cost of food for family of 4: $909/month

Average Utilities costs: $402/month

Let's leave out things like the arts, credit card debt that averages about $7,000 a month carried at 17%, vacations, savings for emergencies, repairs & maintenance, beauty & hair, all of those little extras. Heck, we didn't even include car insurance because it's not required in every state.

We started with $8,300 a month in disposable income and end up with $1,454 dollars of disposable income. Of course, this isn't one size fits all. Perhaps someone had a scholarship for a degree or their parents paid their way. Perhaps they were gifted a car or decided to buy a used one (we have a used car...and only one car.). Maybe they use flip phones, no cable other than internet, and live in a less expensive 900sqft home. These are all choices that can be made, but they are not what the average person is dealing with.

At the end of the day, if families of four in the top 10% of income are walking around with ~1,454 a month in disposable income, they will not be able to afford a new SAILBOAT. The cost of mooring, maintaining, and the monthly payment won't allow for it.

They didn't save up for a down payment on that house? Also, $7000 per month on credit cards? Vacations? Isn't that what the boat is for?


In this case, I'd suggest a boat would be a reallocation of funds from other hobbies.



Wouldn't they save up for a boat, and pay cash for it?


With a $160K salary, they're a) not poor, and b) they can afford a boat. If they can't, maybe they should also budget for a financial planner.

[Mike OReilly]

Originally Posted by letsgetsailing3

It took you about 20 seconds to google that, and was worth about 20 seconds.

There is no clear trend of declining auto sales in that report. What I see is a cycle there of a recovery from the financial crisis of 2007/2008, and an indication that people are choosing SUVs and trucks (which are more expensive, by the way) over smaller passenger cars.

Did you even bother to look at the full dataset? It went to 1951. If you can’t see that the bars are higher back then, and despite ups and downs, have trended lower, well… I’m really not sure what to say.

Here’s two more screen captures of similar data.

Originally Posted by letsgetsailing3

U.S. Boating Industry Sales at a 10-Year High

U.S. Recreational Boating by the Numbers (Source: NMMA’s 2017 Recreational Boating Statistical Abstract)

Yup… they’re comparing 2009 to today. Remember what happened in 2009? I’m taking about actual trends, not blips. Look at data from 1980 till now. And when you factor in the US population growth over the same period (227.22 million in 1980 vs 329.10 in 2018 — an over 30% increase), well...

And even comparing registered boats over the last 10 years, there were just shy of 13 million boats registered in 2008. Today the association that is here to promote boat sales is bragging about 12 million.

And as you say, what positive data there is applies almost exclusive to small boats — not cruising level boats that we’re talking about here.

[letsgetsailing3]

Originally Posted by Mike OReilly

Did you even bother to look at the full dataset? It went to 1951. If you can’t see that the bars are higher back then, and despite ups and downs, have trended lower, well… I’m really not sure what to say.

Here’s two more screen captures of similar data.



Yup… they’re comparing 2009 to today. Remember what happened in 2009? I’m taking about actual trends, not blips. Look at data from 1980 till now. And when you factor in the US population growth over the same period (227.22 million in 1980 vs 329.10 in 2018 — an over 30% increase), well...

And even comparing registered boats over the last 10 years, there were just shy of 13 million boats registered in 2008. Today the association that is here to promote boat sales is bragging about 12 million.

And as you say, what positive data there is applies almost exclusive to small boats — not cruising level boats that we’re talking about here.

And you don't think the numbers are in any way correlated to the baby boom? You don't think that the number of boats registered in 2008 was the swan song of the housing boom and the financial crisis?


It may well be more complex than the "we're all getting poorer" theme, though one should expect that globalization will help the poorer countries and hurt the richer ones.

[LF4]

Originally Posted by letsgetsailing3

They didn't save up for a down payment on that house? Also, $7000 per month on credit cards? Vacations? Isn't that what the boat is for?


In this case, I'd suggest a boat would be a reallocation of funds from other hobbies.



Wouldn't they save up for a boat, and pay cash for it?


With a $160K salary, they're a) not poor, and b) they can afford a boat. If they can't, maybe they should also budget for a financial planner.

$313,000 is the amount borrowed after down payment.

$7,000 a month on credit cards was never stated. A carried amount was stated at $7,000 with about 17%apr.

Vacations and credit cards were not included in the final disposable income number. So yes, we can assume they don't exist. If we assume these things do not exist we assume no financial planner is needed. So we don't have the cost for that either.

Lets assume all dollars from final disposable income are saved:

Input Summary
Years 12
Rate of return 7%
Initial investment $0.00
Additional investments $17,400.00 per year
Inflation rate 2.9%
Tax rate 15%
Net return after taxes and inflation 3.1%

Results Summary
Compounded interest return $20,542.66
Simple interest return $80,753.40
Total invested capital $208,800.00
Investment final total $310,096.06

So in 12 years if the buyer saves, invests, and buys in cash. Lets also assume that salaries increase at the rate of inflations. This is how much boat they can afford in the year 2031:

$310,096.06

What type of new sailboat do you suppose they can afford after taxes/insurance/mooring?

The answer...a boat that has a price tag around $235,000 new today.

[Mike OReilly]

Originally Posted by letsgetsailing3

And you don't think the numbers are in any way correlated to the baby boom? You don't think that the number of boats registered in 2008 was the swan song of the housing boom and the financial crisis?

The Millennial generation is now larger than the Baby Boomers. It’s not about the numbers. It’s about basic economics. It’s not being pessimistic, or optimistic, it’s about recognizing reality.

Originally Posted by letsgetsailing3

It may well be more complex than the "we're all getting poorer" theme, though one should expect that globalization will help the poorer countries and hurt the richer ones.

Boat sales and boating participation numbers are definitely more complex than simple wealth economics. There are, as has been noted, real shifts in the way people choose to spend their leisure time. The fact that more people are working longer hours now, with less paid vacation time, is another factor. Or that more and more work is now done in financially precarious relationships (the so called “gig” economy) with less security … all of this factors into it.

[Exile]

Originally Posted by Mike OReilly

Did you even bother to look at the full dataset? It went to 1951. If you can’t see that the bars are higher back then, and despite ups and downs, have trended lower, well… I’m really not sure what to say.

Here’s two more screen captures of similar data.



Yup… they’re comparing 2009 to today. Remember what happened in 2009? I’m taking about actual trends, not blips. Look at data from 1980 till now. And when you factor in the US population growth over the same period (227.22 million in 1980 vs 329.10 in 2018 — an over 30% increase), well...

And even comparing registered boats over the last 10 years, there were just shy of 13 million boats registered in 2008. Today the association that is here to promote boat sales is bragging about 12 million.

And as you say, what positive data there is applies almost exclusive to small boats — not cruising level boats that we’re talking about here.

Another significant variable in the trend in auto sales could be that people are keeping their cars a lot longer. That itself could be attributed to similar issues over affordability, but could also be the result of modern cars being more reliable & durable (i.e. better built) than their forebears from the 80's & 90's.

In fairness, most of what are considered major economic indicators by most economists are well to the upside in the U.S., but not so for many other regions, like the EU. Unemployment numbers at historic lows, mfg. increasing, repatriated capital, equity markets up (along with retirement plans), interest rates (still) low, middle-class wages rising, consumer confidence high, many taxes lower but higher govt revenues (but growing debt due to ever-increasing govt spending). These strongly suggest conditions which improve the health of the middle class, but the turnaround has only been a couple of years, so we'll see.

As for presidents, you know the drill. Take all the credit for successes and blame others for any failures! One of the few truly bipartisan policies these days.

[Mike OReilly]

Originally Posted by Exile

Another significant variable in the trend in auto sales could be that people are keeping their cars a lot longer. That itself could be attributed to similar issues over affordability, but could also be the result of modern cars being more reliable & durable (i.e. better built) than their forebears from the 80's & 90's.

Yes, there’s that as well. As with most things, it’s not a simple cause-effect relationship. Reality is always more complex. And then there’s the huge rise in leasing. Fewer people even bother to try and own a car anymore.

Originally Posted by Exile

In fairness, most of what are considered major economic indicators by most economists are well to the upside in the U.S., but not so for many other regions, like the EU. Unemployment numbers at historic lows, mfg. increasing, repatriated capital, equity markets up (along with retirement plans), interest rates (still) low, middle-class wages rising, consumer confidence high, many taxes lower but higher govt revenues (but growing debt due to ever-increasing govt spending). These strongly suggest conditions which improve the health of the middle class, but the turnaround has only been a couple of years, so we'll see.

Yes, it’s looking much better in the US right now. As you say, this turnaround has happened only in the last few years, so it will take time to see the impact. Hopefully this signals a reversal in these long trends of declining middle class wealth. Time will tell.

Originally Posted by Exile

As for presidents, you know the drill. Take all the credit for successes and blame others for any failures! One of the few truly bipartisan policies these days.

So true… at least some things never change .

[LF4]

Originally Posted by Exile

In fairness, most of what are considered major economic indicators by most economists are well to the upside in the U.S., but not so for many other regions, like the EU. Unemployment numbers at historic lows, mfg. increasing, repatriated capital, equity markets up (along with retirement plans), interest rates (still) low, middle-class wages rising, consumer confidence high, many taxes lower but higher govt revenues (but growing debt due to ever-increasing govt spending). These strongly suggest conditions which improve the health of the middle class, but the turnaround has only been a couple of years, so we'll see.

This is true, the economy in the USA is doing pretty darn well and the middle class has a fighting chance again. You are also correct that the EU, China, Mexico...are not looking so hot right now.

My arguments, made above, is that brand new blue water SAILBOAT's over 40ft (possibly even 35ft) are not available for purchase by the middle class or even the bottom of the top 10% of earners.

I would 100% agree that the middle class is able to afford power boats, Jetskis, small fishing boats, etc. etc. etc. The middle class is able to traverse our rivers, ponds, lakes, and intercoastal water ways. (I could literally go buy a fishing boat, two kayaks, and a pair of jetskis this afternoon)

But getting to the deep blue for a crossing? Not so much.

What they CANNOT make are the $300,000-$800,000 purchases on brand new blue water sailboats.

[letsgetsailing3]

Originally Posted by LF4

This is true, the economy in the USA is doing pretty darn well and the middle class has a fighting chance again. You are also correct that the EU, China, Mexico...are not looking so hot right now.

My arguments, made above, is that brand new blue water SAILBOAT's over 40ft (possibly even 35ft) are not available for purchase by the middle class or even the bottom of the top 10% of earners.

I would 100% agree that the middle class is able to afford power boats, Jetskis, small fishing boats, etc. etc. etc. The middle class is able to traverse our rivers, ponds, lakes, and intercoastal water ways. (I could literally go buy a fishing boat, two kayaks, and a pair of jetskis this afternoon)

But getting to the deep blue for a crossing? Not so much.

What they CANNOT make are the $300,000-$800,000 purchases on brand new blue water sailboats.

When could the middle class EVER afford a house AND a new blue water sailboat?

It's not like a brand new 40-50 ft blue water sailboat was ever cheap.

And yes, the top 10% can absolutely buy such a boat if they plan well and prioritize it. But little princess may have to forgo the horseback riding lessons, and the cars might be Toyotas instead of Porsches.

If you're single and have an income of $100K, you can buy a boat. If you're married and have an income of $160K, you can afford a cruising boat. Won't necessarily be a new one, or a handcrafted "blue water cruiser". Isn't this why Catalina Yachts is the largest sailboat producer in the U.S.?

[LF4]

Originally Posted by letsgetsailing3

When could the middle class EVER afford a house AND a new blue water sailboat?

It's not like a brand new 40-50 ft blue water sailboat was ever cheap.

And yes, the top 10% can absolutely buy such a boat if they plan well and prioritize it. But little princess may have to forgo the horseback riding lessons, and the cars might be Toyotas instead of Porsches.

If you're single and have an income of $100K, you can buy a boat. If you're married and have an income of $160K, you can afford a cruising boat. Won't necessarily be a new one, or a handcrafted "blue water cruiser". Isn't this why Catalina Yachts is the largest sailboat producer in the U.S.?

As far as when...some are posting here saying they could in the 1960's-80's.

anyhow...

I think we agree, then.

We are top 10%, certainly cannot afford a new cruiser in the size required to do what we want...yet

We drive a Kia...and take public transit.

Our princesses do affordable extras.

Our plan has us buying the boat in about 8-10 years. Sooner if we rent the house and live aboard. Still waiting on the school district to give us instructions on school zoning if we live on a boat in a marina year round.

In the end, hard work and sacrifice can prevail.