Boat Values

[Dan1]

Hello All,

I am brand spanking new to your forum but thought I would be brave and ask a very fundamental, relavent, and novish question.

How can I find out the true value of a boat so as to make an offer?

Every time I try to use NADA values the brokers or Owners reject them as too low or they just say they don't apply. I don't want to insult the owners but at the same time; a newbie like me does not want to over spend what money I do have.

Any suggestions?

[jzk]

Look on Yacht World and research the asking prices of the boats you like. Then ask a broker for the reported selling prices for that boat for the last however many months. Yacht World keeps track of reported selling prices.

[jzk]

And, don't be worried about insulting anyone. There is no harm in asking. I have been watching the prices of the Leopard 47s that have been coming out of the moorings. I looked at one listed for $330k that ended up selling for $265k. And, there is a Leopard 45 listed for $498k. A fair offer for the 45 might be $230, less than half the listing price. No way will anyone pay 498k for it no matter how nice it is.

[Pblais]

There really are no methods to compute the value that works and there isn't a secret password that clues everyone that you are not someone new. The value is any price the buyer accepts. If you have been rejected then maybe you really do know the value and the seller does not know . You might be right, but you don't get the boat. Maybe you are wrong it just didn't work. I wouldn't worry about being insulting. If you make an honest offer and it's rejected then you move on.

The plain truth is there is no secret rule that says how much you should offer. The best bet is to see what other similar boats are offered at and compare the asking price and then compare the boats. If the owner is in line then that is where most of the bidding starts. They still may be high. A good broker isn't going to list a boat at a price it won't sell at or negotiate from.

If a boat is offered far more than it's worth, you generally move on. Some sellers are too high and they just don't know the real value. Sellers are not assumed to be smart. If a boat is listed like others then compare them and bid on the better boat. Most sellers have not looked at all the other boats for sale but you can. You can know which is better and what it is compared to others. You can be smart and see for yourself.

If you find the best of a given boat being offered at the best price then negotiate. Getting the better boat at a fair price is - better than a wreck you get a deal on!

It's not about being new or experienced it's about looking at what else is out there. The market is always right. If you are just low balling boats it can take a long time before you find a boat that has too many problems you can't see and the seller decides you are it and he negotiates. It's better for you to negotiate on the better boat and get it.

Don't get desperate and do something foolish. If you compare boats you can get a ball park of what things are going for. the market is a little bit goofy now. Boats are not moving well and some sellers need the money. If you act like a vulture they figure you are one. People don't want to think yo are tying to cheat them.

Originally Posted by Dan1

Hello All,

I am brand spanking new to your forum but thought I would be brave and ask a very fundamental, relavent, and novish question.

How can I find out the true value of a boat so as to make an offer?

Every time I try to use NADA values the brokers or Owners reject them as too low or they just say they don't apply. I don't want to insult the owners but at the same time; a newbie like me does not want to over spend what money I do have.

Any suggestions?

In the eyes of every owner HIS boat is above average!

If you are looking a a number of boats you will very soon have a better idea of what "average" condition is than the typical boat owner. Do not let an owner or broker bully you into paying more than you think the boat is worth. There are LOTS of boats for sale out there, and you will eventually find a buyer who is realistic or hungry enough to sell at your price.

[Dan1]

Thanks for the quick replies.

I am like everyone who is hungry and goes out to eat, then orders before he looks at his wallet. My eyes are definitely bigger than my wallet.

But I believe you are all right. Best not to get in a hurry. I want to sail - not repair!

[Pblais]

In the eyes of every owner HIS boat is above average!

We can all assume that. I know I wouldn't want a less than avergae boat. Who would?

[Boracay]

When I was looking there were way too many overpriced heaps of #&*% listed. There seemed to be buyers running round with money falling out of their pockets.

Two years later I have come across a few sad and sorry buyers, but very few sad and sorry sellers.

You don't say why you are buying, but it might be an idea to get your own motives clear before trying to deal with someone else's.

In general I would expect true gems to be expensive but underpriced, trashed out heaps of #&*% to be cheap but overpriced.

[bfharris]

Originally Posted by Boracay

In general I would expect true gems to be expensive but underpriced, trashed out heaps of #&*% to be cheap but overpriced.

I completely agree. For our current boat, we looked around a lot before buying. We actually found our boat within a week of looking and didn't buy, because it was way more than we were looking to spend when compared to others like it on the Net for sale. After looking around at the others that would save us several thousand on the purchase price, they all turned out to be less than attractive (most had obviously used photos from when they had bought the boats years before) and I didn't want a boat I would be ashamed inviting guests on. Doing the math on the less expensive boats, compared to the one we ended up buying, the purchase was less on the other boats, but adding new sails or winches or whatever else they needed, compared to the boat we bought that had a new genoa and 2 yr old main, plus woodwork had been kept up, etc. etc. You get the idea. The boat we had looked at a week into our search was still available, probably because on the Net it appeared more expensive, but in person, after seeing so many other boats, it turned out to be a deal.

[David_Old_Jersey]

Originally Posted by Pblais

The value is any price the buyer accepts.

Yeah.

And it's the same as buying or selling anything else. Knowledge gives you power.

And remember that just because someone is selling does not mean they know what they are selling! But too often this seems to result in "rose tinted spectacles" being the norm when folk are selling boats giving rise to unrealistic expectations. If someone wants to sell "the market" will correct this - just takes time. Me I won't even look at a boat I figure is well overpriced on the basis that I simply can't be bothered spending time trying (and probably failing) to inject some reality into expectations......plenty of other boats to see that will also turn out to be overpriced once viewed!

Remember that the big advantage a buyer has in any deal is...........the ability to walk away. Use it.

[sandy daugherty]

You can forget any published used boat prices. They are a total joke. Someone just tries to apply a WAG at depreciation from whatever they thought a MSRP was. Waste of ink. Member Brokers at New and Used Yachts for Sale - YachtWorld.com can subscribe to a site that publishes what member have reported their listings sold for, and those actual selling prices are all over the map. Some boats go for more than the asking price (possibly because the buyer wants the dinghy and the ssb) and others go for a small fraction of the asking price. While the Law of Averages requires one or two owners to undervalue their boats, for one reason or another, it also requires a buyer or two to pay more than what the seller really expected. Condition is more important than age. Old, perfectly good electronics can actually detract, and smell can lower a selling price $10,000.
In recent years its been common for cruising cats to stay on the market for a year or more, simply because its a big world with a small number of afficionados. Owners know that, and are willing to wait.

[ssullivan]

An interesting tidbit:

When I was shopping for my previous boat (45' mono), I encountered a guy who was "hobby selling" his boat.

He had a very high price up, through a broker. When we started to talk, we gave a reasonable offer, but the guy was not interested in getting less than his asking - $120K for a 1985 Gulfstar Hirsh 45!! It had little equipment and is *still* on the market today, umpteen years later.

This guy launches the boat every season, uses it, has been working on it, but yet still has it on the market.

I found that type of seller to be very strange. Very little interest in selling the boat, unless a "jackpot" came along.

Thought I'd share this... with hopes that the OP can take something from this story.

To directly answer the question:

Do as suggested before - get a broker to go into soldboats.com for you and get the actual selling prices of similar models over the past few years. It's a great way to set your expectations, correct any selling over-inflation and make sure you are getting a fair deal.

Don't expect to get the boat for too much *less* than it's worth, but expect to pay a fair price and you'll do well.

So many factors here. Especially with a soft market. I absolutely agree that you should offer what you feel the boat is worth to you. What is the worst that can happen? The seller says no. Take a look at what is out there for sale. Find the lowest price you can for the model you want, and consider that a good basis for a starting bid. The hobby sellers will not negotiate anyway, so once you establish that they will not negotiate, move on to someone who actually wants to sell a boat. NADA is not perfect, but it is a formulaic method to calculate the value of a boat based on year and equipment. It does not take into consideration, market, or condition. It will give you an indication of a price range, all things being equal.
If you really want to calculate the value, you need a complete spec sheet. You need to locate comparables, confirm them, ask for the price of recent comps that have sold, add and subtract for equipment, based on current value of that equipment (Does a Loran actually add value?), and adjust the price for overall condition (Mechanical, sails, interior, exterior). It's not rocket science, but it takes allot of effort. If you do not do it every day, you will not have the resources at hand to make it an easy task. There are companies out there, such as ADP, who complete market valuations on vehicles and boats every day for the insurance industry. They have those contacts, but I am not sure they would run a value for the general public. Even then, it may not be a cost effective option, unless you have narrowed your search to one or two boats.
Bottom line, determine what you feel is a fair price, start lower than the most you are willing to pay, make the offer, and negotiate. If you can not buy the boat for the price you are willing to pay for it, change the price, or change the boat.

[Sandero]

It s rather hard to place a value on a boat such as Shiva. Although she is 22 years old, she has been meticulously maintained by the original owner - me. So I know ever bit of her maintenance history and so forth and most of it is documented in the massive file I have which is 15 inches thick!

There is few of the OEM gear on her from hatches, to portlights, to running rigging, pumps, hoses, almost all wiring and electrics, head and lights upgraded. And then there's all the gear that was added, electric windlass, diesel forced air heating, below decks autpilot, radar, AIS, cockpit repeaters, washdown system, cockpit shower, running backstays, solid vang, whisker poiles, storm canvas, inner forestay, stay'sle track, dodger w/ ss bows, cockpit cushions, large wood helm, solar panels, whisker pole on track, cruising chute, custom joinery like sole grates, chart storage, inverter, shore power, high output alternator w/ smart regulatorsm, link monitor, echo charge, propane solenoid/alarm, SSB 2 plotters, insulated backstay, cedar lined lockers, engine drive refer, ss stanchion bases,2 "car" stereos w/ 6 speakers, new stove, engine room insulation, batts (of course) and the list goes on and on. New life lines, genny cars, dinks and outboards...

What's original? The volvo penta engine, the mast, boom, pulpit and pushpit, the CQR anchor, the Whitlock pedestal and Weems&Plath binnacle compass, the cabim sole, the original joinery and hardware, sinks, faucets, steering system, hull (of course) and the high density foam in the upholstery.

So in this yacht you not only have everything well maintained, upgraded, but you have many new "things" not found on other similar hulls, and the complete history of every purchase documented, added to the fact that Contest is European built boat and the dollar is sinking making the replacement cost more than double since she was purchased.

Even selling her for much more than I paid, I can never recover the cost off all the upgrades, sails, and gear.

I ran some estimates and I figure the total cost of ownership and maintenance, mooring, storage, insurance... the whole ball of wax was $20k per year. YIKES I spent close to $500,000 over the past 22 years!

But I had a summer place for 22 years, a home for 4 in the some exotic places, oodles of fun doing all the work (I hate bottom work).

So I consider that good value AND I have a beautiful yacht, years ahead of great times and more repairs, replacement and so forth.

Had I bought a house I would have been miserable mowing lawns, painting, repairing roofs and dreaming about places surrounded by blue.

Is there depreciation? You betcha? But all the above considered, it was worth every penny and I don't regret it a bit. Getting Shiva was the best move of my life, bar none; learned the most in so many ways... and still do.

[hellosailor]

Dan, the value of a used boat is literally what someone will pay for it, cash in hand today. In theory the BUC Book values are actual sale values, but you often have to be a mindreader to figure out real condition and circumstances versus reported prices and conditions. For any "book" numbers.

Better to be familiar with wider markets, what similar boats in similar places and circumstances are going for, and then to start with what an "average" boat really would have sold for (very recently) and then adjust up/down for the condition of the one you are looking at, i.e. engine? sails? hull work? If you had two 40'ers, one with old bedsheets and the other with four shiny new offshore sails and all new standing rigging...you could easily say one was worth $15-20k more than the other.

But it still comes down to, what are you willing to pay? If you're not willing to pay, it isn't worth that much to you. If a boat isn't sold in 90 days, or you can't find one in 90 days, the "value" has been set unrealistically, or someone isn't doing marketing.