boat value revisited

[Ken Heyman]

There is much on the forum regarding value but out of curiosity I used the Boat US Web site to provide an estimated value for my 1988 c34. I then compared this to the Nada valuation. The difference is astonishing. Nada reflects 43 - 45K while Boat US shows values in the 32-37 arena. My bias was the Nada numbers but now I'm wondering. Both sites consider location, age and extras. Does anyone have any "first hand" info or are prices all over the place?

BTW, It doesn't really matter 'cause we love the boat. Nevertheless, it is always reassuring to feel the boat holds its value. At 45K yes ---at 35K it hasn't.
Ken

[Ken Krawford]

I just checked BUC.  They give a value of $33,300-$37,000 for a 1988.  When I considered trading my 1988 C34 in, the dealer used BUC values.  BTW, they were close to this range 3 years ago.

[Stu Jackson]

There have been a series of discussions about this over the years.  My experience is that the BUC value is at least 25% too low based on the prices of boats being sold around here.  While there is merit in recognizing the difference between asking and selling prices, I would think that a 3%-5% difference would be more applicable, and while folks may low-ball offers and negotiate items based on the condition of individual boats, we've seen the older boats in our 1986-7 vintage still going for around $50,000.  The 1986 boats have just started being shown for $49,000, but I do not know what the condition is, what kind of additional equipment is available and what the maintenance history of these boats could be.

These low-ball estimates have been around for a long time, and seem unsupported by the facts.

Trade-in values are alo more likely to be lower than if sold personally.  The C34 is a very popular boat and few last on the market here more than a month.

Your mileage may vary...

[Ted Pounds]

I sold mine for more than $50K last year.  I too think the BUC and other estimates are low by 25%, FWIW.  My broker checked sale prices for a number C34's in the area before helping me set the price.

[Ken Juul]

I thought there was a mistake on my last Personal Property bill.  The amount went up rather than down like it usually does.  A call to the tax office indicated the increase was because the average sales price of used C34s went up the past year!  They would not disclose the source of their data, local brokers think it is the BUC.

[Ken Heyman]

Ken,

While we don't have a personal property tax here, I wonder if I could explain away a rather ridiculous increase in our real estate tax bill based on "rising" c34 prices. While most would not consider a boat "real property", they are regrettably occasionally attached (grounded)  to the "earth"---    are they not?

I'm heartened by Ted's experience since we both live in northern Illinois.

Thanks (all) for the info,
Ken

[Terry Forshier]

I purchased my 1988 about a year ago and it appraised at 51,000 by the surveyor. At that time my reseach on the net showed this to be at the top of the sold list prices. However, the boat was in very very good condition and had nearly every upgrade possible. I am in SW Florida. There were sales for less in the mid 40's but these boats did not compare to the one I purchased. I did negotiate down the price I actually paid. Terry

[Stu Jackson]

An earlier thread on this subject: http://c34.org/bbs/index.php?topic=2024.0

Ken K. DID sell his boat!

[midlifesailor]

The link to the previous thread was interesting, but the economy has changed dramatically from 2 years ago.  Thanks in large part to the sub-prime mortgage mess, we are facing a downward turn in our economy that I believe will last 2-3 years or more.   Folks selling boats in that time are going to face downard price pressure so those that need/have to sell will likely get less than they would like.  Passing on offers while waiting for a higher price will probably just mean more carrying costs until they do take a lower price than they want or decide to keep the boat.

As to BUC values, asking prices for the C34's I've looked at are around 30% above average BUC.  Obviously, no one owns an "average" boat -- they are all far above average.  Also its clear in the listings that many owners have a hard time separating the difference in "maintenence" dollars spent and "improvements".  "Maintenence" is expensive but doesn't really ADD value to your boat -- Rather it keeps the value of your boat from rapidly going to near zero.  Even improvements can't be expected to add dollar for dollar value as some asking prices seems to reflect.  As a buyer, I have looked at a lot of boats over the past 6-8 months, all priced far above BUC.  Few if any were in a condtion I considered truly "above average", most were not interesting enough to pursue getting comp prices on and some were projects priced as "ready to sail".  In my opinion the nicest boats we have seen were just average with some nice extras.  To me an "above average" 18 YO C34 would have new lifelines, new standing rigging, an upgrade to the problematic Hood LD furler and sails less than 5 years old.  A rigger will tell you the standing rigging and lifelines should be replaced after 10 years but, but very few owners follow that guidance, so to me an owner that's taken these steps has kept their boat in "above average" condition.

According to Soldboat info provided to me by a broker, the last couple of 90-93 C34's sold on the east coast brought $52K and prices are down from earlier in the year.  The average of 10 C34's in that year range from all over the county was $55K.  The delta in asking price and sale price varied from 7 to 13% and there appears to be some regional differences, likely based on availablity and fresh vs. saltwater.

As a buyer, looking at the direction of the economy, I probably couldn't be convinced to offer anything north of $50k for an early 90's 34MKI, unless it was very well maintained, equipped with a fresh suit of sails and had considerable other upgrades/equipment.  As a seller, I have an offer pending on my non-Catalina and expect the sale will go through.  I took a pasting, but my boat is (hopefully) sold while all the other boats for sale in our marina are still "waiting for that right buyer".  I'll probably get lambasted as one of those "low-ball" buyers, but wanted to share my perspective as a potential C34 buyer and while taking my lumps as a seller.

[Jon Schneider]

Midlife, I think you're dead on with your assessment/definition of boat value.  And as to being a bottom feeder, I guess all of us who bought a used boat can be somewhat accused of that.  I do think you're wrong, however, in regard to your economic prognostication.  Well, actually I don't think you're wrong as much as your scenario has about as much chance of proving correct as Bernanke's or anyone else's.  If you have some superhuman insights into this, though, please do tell us what stocks to short and at what points in time ;)  BTW, according to your definition (with which I thoroughly agree), I am pleased to realize that I have an "above-average" C34 (new lifelines, rigging, sails, furler).  Alas, I thought I had a "far above-average" C34.  I'll keep trying.

[midlifesailor]

I can't claim any superhuman insight and frankly my last 4 or 5 stock picks are all still in the red, so I can definitely be wrong.  ;-)  However, by investing in longer term trends, I've managed beat the S&P 500 as well as most mutual funds by a wide margin.

Looking at all the factors, I believe we're at the point in the business cycle where we are due for a slow down and $100 a barrel oil coupled with fallout from the subprime mess in the form of tighter availablity of credit and depressed home prices spells a slow down in luxury items like boats and RV's.   Major media have covered the sharp decline in RV sales as an indicator of the nations mood, so I didn't just make this up.  Still, as you point out, none of us have a crystal ball.  I took a loss on my boat hoping price pressure will work in my favor to find a step up boat, but I could very well have made a mistake.

If you're happy with your boat this is defintely not the time to sell, but if you want to move up, downward price pressure is a two edged sword.  It hurts you on the sale, but may help you out buying.

[Jon Schneider]

I don't disagree, but a slowing economy does lift some boats (to mix metaphors).  People are feeling less rich, and indeed we are less rich; there is less speculative equity to take out of our homes.  I suspect, however, that just as in past recessions, while housing prices decline in some markets, people will tend to put capital into their homes in the way of improvements (although this is a lagging effect and hasn't really evidenced itself yet).  The same might be true for the used sailboat market, which I think exhibits a different dynamic than any fossil-fuel-based luxury comparable.  Of course, the value of used boats only goes in one direction no matter what (generally speaking), so I think the effects of the current economy -as long as employment holds- will be less dramatic, if at all.  In fact, my sense recently has been that as people felt more and more flush, their "irrational exuberance" allowed them to squander their money by purchasing a brand new boat rather than play it more conservatively by buying a used boat.  (No offense to new boat buyers... I'd love to count myself among you.)  The point is that as the economy weakens, there may indeed be less boat buyers overall, but more of them may convert to buying used sailboats, and this change in the new-versus-used ratio may result in a net increase in used sailboat buyers.  That will be a bad thing for Catalina, Hunter, Tartan, Beneteau, et al. 

I'm wondering what the effect will be of declining stinkpot sales/usage on marinas.  My marina definitely had slips available this year without a wait for the first time in four or five years.  If more are open next year, will they try to choke revenue out of those of us who remain by increasing prices, and possibly scare more off or will they recognize the declining demand and make their pricing more appealing (lower)?  I suspect that the owners are too greedy (and potentially over-leveraged) to attempt the latter. 

[midlifesailor]

Good points Jon.  One other thing that I forgot to mention that works against my prognostication is the weak dollar.  Depending on your location, buyers from other countries may help prop prices up as the exchange rate makes buying in the US more appealing.  At least 3 of the boats I've looked at, (2 of them Catalina's) were also being looked at by folks from north of the border according to the broker, though all are currently still on the market.

[tommyt]

This is one of those threads that SHOULD NOT really matter unless you are a buyer or a seller. As we all love our 34's, why would we want to sell?

I think that Midlifesailor has hit it pretty well on the head, and he is a buyer and the buyer today is more in control than a few years ago. Whether you agree or disagree with his economic forecasts, his discretionary dollar forecast sounds pretty fair to me. Now, some of might say it is not discretionary because we cannot think of life without our boats, but not everyone has that problem.

Yachtworld has about 30,000 sailboats for sale at the moment. Now, one of them is over 200' and $24,000,000 (can't remember if that is US$ or Euro's, but who cares) but there are over 1500 Catalinas, all lenghts, on there as well. Some are fairly priced, some are rediculously over priced, and some are hurricane boats. 99% of the Catalina's are in the US.  At the end of the day they are all looking for buyers, and they are depreciating assets. I love my boat, and don't plan on selling it soon. However, I know that I could negotiate a much better price for a boat today than I could 5 years ago, except on Euro boats where the dollar affects the bottom line.

Nice call Midlifesailor. Hope you get the boat of your dreams at your price and join the C34 org. Good luck!

[John Langford]

Yup, Canadians are definitely invading the US boat market. Three used Catalinas from California have appeared at my yacht club in the last three months. We are making every effort to maintain the buoyancy of the used Catalina boat market and carry it through the sub-prime mess. It's the only neighbourly thing to do!