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Old 06-04-2020, 08:33   #16
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Re: THE VALUE OF UPGRADES WHEN SELLING

I bought a secondhand 10m monohull just over 4 years ago. In my search I looked at a lot of classes of boat and then narrowed it down to a Westerly Storm. I looked at 3 or 4 Westerly Storms, travelling some distance to do so. Some were in poor condition and they were immediately ruled out. I also looked quite a few online. I looked at one in Northern Ireland (UK) that was in average condition and on the market for around $25,000. I then tried to cost all the improvements and upgrades I would want to do on it. I reckoned I would need to spend about $8,000 on upgrades – assuming my estimates were accurate - and that was before any travel costs to install or supervise installation.

There was a Westerly Storm 50 miles away from me in Portsmouth UK on the market for $35,000 that looked in good condition and had a lot of nice extras – Anderson winches, a three bladed folding prop and nice chart plotter, heating etc etc. It was a bit of a no-brainer. I had the money and negotiated on that one. I have still spent money on it since the purchase (new jib furler, electric windlass). But it needed less doing to it and and was a safer bet. That $8,000 upgrade estimate might have been a lot more.

The extras didn’t sell the boat. The key issues was the overall condition it was in and the inventory that came with it. But the extras were a bonus and I reckon worth about $5,000. I bought at the top end of the market. But to this day those $5,000 worth of extras help me justify the decision I made and the price I paid!
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Old 06-04-2020, 08:56   #17
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Re: THE VALUE OF UPGRADES WHEN SELLING

Another way of looking at it is - any upgrades will help the boat rise to the top of the current market offerings, and will likely help it sell faster.

Boats that take a long time to sell - cost their owners hundreds of dollars, if not thousands in carrying costs for every month they are still on the market. You will not get much additional money for the boat upgrades invested in - but you will likely lose less in carrying costs - waiting for a more mediocre boat to sell. In net return, it might balance out more favorably.
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Old 06-04-2020, 09:40   #18
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Re: THE VALUE OF UPGRADES WHEN SELLING

I agree with the above that upgrades don't really add value, just may increase desirability and/or reduce selling time. But, depending on the buyer, you might be able to negotiate removing some items if he doesn't want/value/need them. I sold a sailboat many years ago that was setup for long range cruising in the Caribbean. They buyer was buying it for use on the Chesapeake Bay. We negotiated that I remove the watermaker (he had no need for it), the Ham/SSB radio (he wasn't a Ham and no use for SSB) and the inflatable and motor (he already had a newer dinghy). In exchange, once we closed on the deal, I agreed to deliver his boat from Florida to Annapolis at my expense. I was able to use the removed items on my next boat which saved me a lot of bucks and he didn't have to pay a delivery crew which saved him a lot of bucks. Win-win!
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Old 06-04-2020, 09:50   #19
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Re: THE VALUE OF UPGRADES WHEN SELLING

There will be a price a ceiling for a particular make and model of boat. Unfortunately for a boat like mine it's not that much, for a Catalac 8M it's much less.

I know that even if the Catalac 8M was brand new no-one would pay anything near $60,000 for it, and obviously used worth a massive amount less (like 2/3).

That being said, the upgrades do add some value over the basic hull price. Most of the older boats I've seen are sold with antiquated electronics. I see decades old radars, autopilots, charplotters etc.. If there was 1 boat at $18000, and another at $20,000 I'd happily pay the extra for the one with more modern systems. It saves a lot of work and hassle down the line.

Similarly having the bottom paint done, the headlining all taut and holding as it should etc..
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Old 06-04-2020, 09:56   #20
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Re: THE VALUE OF UPGRADES WHEN SELLING

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Originally Posted by mvmojo View Post
I agree with the above that upgrades don't really add value, just may increase desirability and/or reduce selling time. But, depending on the buyer, you might be able to negotiate removing some items if he doesn't want/value/need them. I sold a sailboat many years ago that was setup for long range cruising in the Caribbean. They buyer was buying it for use on the Chesapeake Bay. We negotiated that I remove the watermaker (he had no need for it), the Ham/SSB radio (he wasn't a Ham and no use for SSB) and the inflatable and motor (he already had a newer dinghy). In exchange, once we closed on the deal, I agreed to deliver his boat from Florida to Annapolis at my expense. I was able to use the removed items on my next boat which saved me a lot of bucks and he didn't have to pay a delivery crew which saved him a lot of bucks. Win-win!

Smart deal - really a win-win. It's good to communicate like that-
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Old 06-04-2020, 10:02   #21
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Re: THE VALUE OF UPGRADES WHEN SELLING

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I've had a 1985 Catalac 10M for about 8 years that I now want to sell. About 2015 I did a number of upgrades, of which many were replacements, some were expensive new additions. My interest is; What is the value to a new owner? I'll give a few examples. 1st - added (2) new Flexofold 3-blades 16" props approx. $4k, could be replaced with OEM props for $500. 2nd - added a 20 gal/hr water-maker appproxamately $4.5K, used for one season in the Bahamas. 3rd - added a new Schaefer Roller-Furled boom, mainsail, rigged vang, and electric winch, lets just say $20K+. What is there value to a new owner? Is it worth removing and selling any of the items at say half of there original value? Is there a market for such items, or will I end up giving them away, or better off to not even think about, just let them go?
Price you vessel for what you think it is worth and mention (negotiable) then find a buyer that is willing to pay for the upgrades, Cleanliness is very important when there is a visit from a buyer. Then negotiate the bottom price...
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Old 06-04-2020, 10:06   #22
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Re: THE VALUE OF UPGRADES WHEN SELLING

In my view, anything that changes the original setup of the boat typically does not add value and rarely increases it. Things that I would value are a newer engine, a PSS, a roller furler. These items are a pain to add yourself. However, I would only pay the average market value of the equipment, taking age into account. For example, take a 30 ft boat, with the typical Yanmar 2G engine. A new two cylinder Yanmar installed will cost around $7-8,000. The value to me given the age of the boat will be around $2-3K and so on. Upgrades do not add value but they do make the buyer feel good that you are meticulous and take care of the boat. That is worth money to some buyers. But in general you pay the market prices for the boat of your size and age. It also depends if you are getting a first time buyer or a second time buyer. If I were to buy another boat these days I would gladly pay extra for time consuming maintenance/optical efforts such as bright work in good condition, good sails, pristine deck/hull.

Also, do not take equipment off the boat. Usually you will not get much money for it and it is better passed on to the next person. He will come to appreciate it with time.
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Old 06-04-2020, 10:11   #23
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Re: THE VALUE OF UPGRADES WHEN SELLING

The value of upgrades when selling = 0.
First off, one man's "upgrades" are another's bane.
However, boats are hard to sell, proper maintenance or "upgrades" may help yours sell over a sistership.

I've often been tempted by a clean boat with almost nothing done to it, over a boat loaded with changes and things that are likely past their useful life anyway. Starting with a clean slate is nice sometimes...
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Old 06-04-2020, 10:45   #24
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Re: THE VALUE OF UPGRADES WHEN SELLING

My opinion, there are some rules and guidelines, but they are much more tactical than the over-arching outcome of adding or not adding value.

First, effective cap based on value of the boat. Assuming a reasonable market baseline for the boat can be established, I think it hard to increase the value of a boat via condition or upgrades by more than about 25%-30% (a guess). Once you get past that, the buyer starts looking at different boats altogether so even if the upgrades are highly desirable, there is a limit the market will bear simply because other options open-up as budget is increased. This is especially true because it will become difficult/impossible to even get someone to look at your boat, let alone value it.

Second, type of boat and typical equipment. Some boats just attract owners who tend to be more fastidious or more wonky about upgrades. Or some boats are often fitted-out with cruising upgrades so if you buy a boat that was naked and toss a bunch of money on cruising upgrades, you're still just keeping level. Yea, your upgrades may be newer and better specs, but in the end, the buyer's box is ticked, and won't differentiate much between 5-year old gear and 15-year old gear if both are serviceable and similar condition.

Third, Nice-to-haves/maintenance vs upgrades. This is the category where I suspect many posts say "ain't worth a dime." A well maintained and cared for boat is worth more money than it's analogue, but it's an overall function, not specific items. An example might be where an owner spends $10k to add 2-speed ST winches and all lines to the cockpit. That owner probably did a bunch of other stuff too - over-sized anchor, etc. The boat will sell at the top of its range, but not because of a direct relationship to the upgrades, but because it's a well tended vessel. In other words, take away any one of the many upgrades and the price will not change a dime.

Fourth, personalized or specialized upgrades. These are the most difficult for sellers to accept. The OP mentioned specialized Props for $4k vs $500 for standard. Doubt that will increase his selling price a dime. Having a second spinnaker comes to mind. And in some cases, an upgrade in this category could reduce the value. Adding a compost head comes to mind (please, don't key on this - I add it because I like them, but recognize the market effect). A nice TV/Entertainment station.

Finally, there are upgrades that do add value. Replacing an Atomic 4 with a new Beta will definitely increase value - you might get equivalent of 25%-50% of your money back on the raw parts. New electronics less than one generation old will add value (more than three or so may detract value). On some boats, adding a bow thruster is relatively inexpensive and something a buyer will definitely recognize as an upgrade (again, in the 25%-50% value). But there is a limit upgrades can add to the overall value - back to #1: if you upgrade too much, your asking price will be so high that no one will look at your boat.

I say the above as a guy who is woefully over-improving my boat. Someday, when I'm gone, someone will get a helluva boat for a cheap price. Good on them!

Peter
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Old 06-04-2020, 11:27   #25
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Re: THE VALUE OF UPGRADES WHEN SELLING

Quote:
Originally Posted by LDO View Post
I've had a 1985 Catalac 10M for about 8 years that I now want to sell. About 2015 I did a number of upgrades, of which many were replacements, some were expensive new additions. My interest is; What is the value to a new owner? I'll give a few examples. 1st - added (2) new Flexofold 3-blades 16" props approx. $4k, could be replaced with OEM props for $500. 2nd - added a 20 gal/hr water-maker appproxamately $4.5K, used for one season in the Bahamas. 3rd - added a new Schaefer Roller-Furled boom, mainsail, rigged vang, and electric winch, lets just say $20K+. What is there value to a new owner? Is it worth removing and selling any of the items at say half of there original value? Is there a market for such items, or will I end up giving them away, or better off to not even think about, just let them go?
An UPGRADE is when you add something to a boat that was not there before. However, if all the competing boats have a widget, your boat should have a widget as well. MAINTENANCE is when you replace something that is already there but there are a few exceptions; engine, sails, and rigging particularly if they are of higher quality.

A lot depends on the buyer's knowledge, expectations and the make/model of the boat. It is surprising how little new sailors look at the sails and I'm not aware of any surveyors that do, even the good ones. For first time boat owners clean, bright, and shiny with an acceptable interior seem to be all important. On selling my last boat she was all that and I got my asking price even though the sails were original and 28 years old.

If a buyer is looking at Catalina 30s, there are always a ton of them for sale and establishing a market price range is easier to come by. The one-off design or limited production boat is another matter. This is so different than the auto market where production runs go into the millions.

Experienced boat owners (this will be their third+ boat) should be more aware of costs and value. But then, there are those for whom a boat is just another toy.

If I recall my marketing classes correctly, sellers should determine who their target market is and go after those buyers i.e. don't try to sell your cruiser to someone interested in racing and vice versa. This approach requires patience but I don't often see that in boat sales...many sellers just want to get rid of their boat. The high cost of mooring is one of the reasons but it has more to do with a change of lifestyle and priorities...they just want to move-on...my sellers were getting out of sailing and into polo horses.

A boat is only worth what someone is willing to pay for it...but it only takes one buyer.

~ ~ _/) ~ ~ MJH
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Old 06-04-2020, 11:42   #26
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Re: THE VALUE OF UPGRADES WHEN SELLING

Based on my personal experience, I bought a boat 15 years ago on which I invested roughly the same amount I paid for the boat to do a total rehab, upgrade and maintenance during the ownership. After completing numerous cruises in the Caribbean, I sold the boat in less than a week last spring 13% over the price paid EXCLUDING the money invested.
According to the last survey , my boat was Above BUC condition Has had above average care and equipped with extra electrical and electronic gear.
I would say that replacing defective equipment or investing in the maintenance will help the boat keep its resale value and will help keeping the boat appealing for potential buyers.
I am looking to buy another boat and among my first criteria, the reputation of the builder, the cleanliness, the evidence that the boat was well kept and appears in good condition and off course the price versus the market.
I noticed that when I find a boat that is over equipped, most of the time, it is overpriced, the extras don’t necessarily correspond to my needs and it even makes me suspicious regarding the seller’s objective.
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Old 06-04-2020, 13:03   #27
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Re: THE VALUE OF UPGRADES WHEN SELLING

My general rule of thumb for any type of merchandise is that you get 25% of the value of an option if a conservative buyer would want it.

However, as a negotiating tactic for a removable option, if a buyer says they don't value the option then see if they will agree to you removing it, regardless of whether you can sell it or not. The desire to resist losing functionality is typically greater than the desire to hustle the price down.
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Old 06-04-2020, 14:01   #28
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Re: THE VALUE OF UPGRADES WHEN SELLING

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However, as a negotiating tactic for a removable option, if a buyer says they don't value the option then see if they will agree to you removing it, regardless of whether you can sell it or not. The desire to resist losing functionality is typically greater than the desire to hustle the price down.
Reminds me of a real estate deal where the seller tried this tactic. I made an off on a 'turnkey' vacation condo in Mexico where it's very common to sell with furniture included. My wife and I didn't care for the furniture, but it would suffice for a year or so. Canadian seller countered our offer, but without the furniture, as if retrieval of the furniture was viable, so it felt like he was playing games. Would have worked better in a seller's market than a buyer's market where real estate can take years to sell (now that I think about it, sounds a bit like selling a boat these days....).
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Old 06-04-2020, 14:20   #29
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Re: THE VALUE OF UPGRADES WHEN SELLING

When you buy a used boat the seller is just as important as the boat. If the boat is cosmetically appealing with the gear you want try to learn as much about the seller as you can. Does he keep up to date maintenance logs? How does he look after other things he owns. When he shows up to open the boat up what does his car look like, is it clean and well kept? The more you know about the seller the more you'll know about the boat because no matter who surveys it, they never get near to covering what really needs to be done but if that owner is the sort of person that really looks after things and was meticulous about the boat maintenance, kept written track of it on a timely basis you just might be looking at the boat to buy.
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Old 06-04-2020, 14:21   #30
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Re: THE VALUE OF UPGRADES WHEN SELLING

My upgrades are done for me. I want them because they enhance my sailing/cruising experience. When I’m done with the boat, maybe the enhancements will sell my boat quicker but recovery of the cost of upgrades is not even on the table.

I reckon that the type is useage the new owner will expect to get from the boat plays a big part in the evaluation of enhancements. My boat is set up to be a passagemaker and a comfortable place to live when away from home. If the potential buyer wants a boat to mess about in his immediate locale, all the watermakers, freezers, fridges, huge electrics, big ground tackle/anchors are not going to make him more keen to buy. In fact as others have said before, the upkeep of all this stuff may put him off.

But if he is planning on moving from a little boat to a cruising boat, the extras on my boat will get him on the hook quicker than the same boat in bareboat form. Regrettably I won’t benefit financially from his choice.

Another perspective I’ve always had is that, whilst I don’t set about abusing/neglecting our boat, I also don’t believe in pouring vast amounts of money into saturation maintenance. If the fanatical upkeep of the boat’s condition will not have a positive effect on the sale price (and it won’t), what’s the point? I’ll rather save the money and effort and take a reduced value when selling. I keep my boat functional and safe, it’s never going to be a new boat again.
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