Collapsing brokerage market for Monohulls

[ramblinrod]

Originally Posted by valhalla360

Who's making this mythical offer and who decides what the boat is really worth?

The scenario you gave is the family needs money or they get the house foreclosed on. If someone makes your mythical offer at "what the boat is really worth", they will decline a low offer so no harm in making the low offer. Reality is 99% of the time, there is no mythical offer so the alternative is they get foreclosed on and likely lose the boat later as things snowball out of control. If they can keep the house, there is a better chance they keep their jobs and can struggle thru.

You are confusing a financial transaction with an act of charity. If you want to dig into the sellers situation and offer charity, good on you but don't confuse it with anything other than charity.

Who said to dig into anyone's financial situation? Not me.

Before making any offer on any vessel, the purchaser should make at least some estimate of what the vessel should be worth, to ensure they do no offer too much. If you don't and offer 50% of asking, it may still be too much, if the asking was 125% more than it was worth.

So if you assess the value at $50K, and offer only $25K, what are you in essence trying to do? Answer: Get something of considerably higher value for less money. This isn't necessarily a bad thing, because as you say, this may save the day.

If your offer is considerably less than the boat is truly worth (as determined by a reasonable fair market analysis), they reject, and you won't budge up, you either can't afford what you are looking at, or you are trying to take advantage of the owners dire financial situation.

You can contradict that statement, or try to justify it a million ways from Sunday, (they don't have to accept), (if I don't somebody else will), etc., etc., etc.

You make no mistake, if this is what you are doing, you are most definitely trying to take advantage of their financial situation.

It isn't charity to offer a seller what an item is worth, and more than what they may be forced to accept, if they have no other offers pending, and are in trouble.

Nobody in their right mind sells a high ticket item for significantly less than what it is worth when they are in financial difficulty, unless they have to.

It is not charity to offer someone what something is worth, it is simply not taking advantage of them, when one has the opportunity to do so.

You can either go into the negotiation, with a "F$%$ you, it's all about me, I want as much boat as I get for as little money as possible", or a "lets agree on a price that is fair to both parties" attitude.

If you offer a low ball, and they are happy to receive it, all is well.

But if you offer a lowball, and they desperately try to get you to come up to what the boat is worth, and you won't, it is very clear what you are doing.

Don't try to tell me that one can't tell when they are taking advantage of another. You can always tell. You don't need their life story, you can see the despair in their eyes.

It's easy to steal candy from a baby. I choose not to be that guy. It's not charity, it's humanity.

[jongleur]

Originally Posted by ramblinrod

Don't try to tell me ...

There are nigh on an infinite number
of reasons that a selling price is what
it is. You seem to be the only one
who is sitting in judgement of them.
A buyer always looks for the best
deal for themselves. That doesn't
mean they are saying **. That's
your interpretation. You also seem
to think that a reasonably priced
boat (whatever that is) will always
sell. That's just not necessarily the
case.

And you haven't answered my
query: If you did not make any
offer and the seller lost their home
would you then feel bad? You
couldn't possibly know their situation.
(The look in their eye?)

[jtsailjt]

I feel like the thing to do is offer about 5-10% less than the boat is worth for YOU to own it and then "allow" the seller to talk you up a couple % so he can feel like he didn't give it away. I wouldn't even want to know the financial situation of the selling party, as long as he has clear title to what I'm buying. I'd also make no apology for offering much less than the asking price, or feel offended if my offer is turned down flat. To me, that's not even a consideration. Yes, offering 50% of the asking price will probably get you turned down more often than not, but if that 50% is all the boat is worth to YOU and the owner wants to keep it at that price, then you move on and find another boat that you can buy for whatever value you think it's worth. No harm done. Sometimes sellers surprise you when confronted with a low, no strings attached offer for reasons of their own and that's none of your/my business. Just be concerned with what it's worth to YOU, not what some third party would think was "fair!" Cash is king and every boat owner knows that it is costing him money for every day he keeps a boat he isn't using or no longer wants to own.

[Polux]

Originally Posted by jongleur

..You also seem
to think that a reasonably priced
boat (whatever that is) will always
sell. That's just not necessarily the
case...

I don't understand what you mean. What establishes prices on a market is demand and offer. If a boat does not sell in a reasonable period of time it means that its price is too high and nobody wants it at that price.

The highest market value of a boat is the highest price a given boat can be sold over a reasonable period of time. If it does not sell in a reasonable period of time than it is not reasonably priced. It is over priced.

[robert sailor]

Originally Posted by Polux

I don't understand what you mean. What establishes prices on a market is demand and offer. If a boat does not sell in a reasonable period of time it means that its price is too high and nobody wants it at that price.

The highest market value of a boat is the highest price a given boat can be sold over a reasonable period of time. If it does not sell in a reasonable period of time than it is not reasonably priced. It is over priced.

I agree with Polux...any boat with the correct market asking price will sell in a reasonable time. What we call reasonable time can vary depending on the overall market.

[Paul L]

Originally Posted by olaf hart

That's one step further down the line, after the buyer has spent time and money looking at the boat.

I want to narrow the gap between advertised price and market price before I decide to look at the boat.

Lots of options in a buyers market, brokers and owners aren't helping themselves with unrealistic asking prices.

Olaf
Not necessarily. If there will be significant costs in viewing the boat AND you know you would not purchase it for the asking price then it is reasonable to negotiate the price based on the sellers description and offer pending reviews . Offer a reasonable sized down payment to show that you are earnest and negotiate away. Then when you have an agreeable price spend the money to travel.
This is how I purchased our current boat. I was in Panama at the time and the boat was in Cape Breton, Canada in winter storage. There was no way I was going to spend the travel costs just to be told that the listing price is what the seller wanted. I know I would not have purchased the boat for the listing price or 5% less, so there was no point in wasting my dollars on travel until we had a mutually agreeable price. You are at a negotiating disadvantage once you have money invested in trying to purchase the boat.

[Colin A]

Originally Posted by Polux

After 2008, meaning after the Crash, all consumer expensive goods come down in a sharp way, from houses to cars, airplanes and sailboats but the important point regarding sailboats is that while de European market is recovering, showing a slight increase almost each year, the sailboat American market went down and keep on sliding down with a bigger fall in 2015 (he have to wait to see what happened in 2016).

The same did not happen with the American motorboat market (more than 26') that after the crash is holding on an in some cases and sizes increasing.

As I am pretty sure that the economic recovery was not better in Europe than in the US what is happening is that Americans are buying more motorboats and less sailboats and part of those buyers had sailboats.

Do to that I don't think there will be a shortage of used almost new boats on the American market because the market itself is shrinking.

However because there are much more newer boats in Europe is probable that the prices ended up being lower on Europe than on US, also because most US new sailboats have become imported boats and that has a cost on the final boat price.

Yacht Sales In European Market Shows Moderate Gains in 2015

The power boat market in the US is hurting as well (I think it's at about 80% or pre-recession levels.) But inside of the motor boat sales is a trend towards large boats (over 50') and towards day boats. Sales of Sterndrive and inboard powered cruisers are less then half what they were before the crash and about 1/4 of what they were at the turn of the century. Large out board powered center consoles and walk arounds have taken their place in many cases.

[Island Time O25]

I'm at our mooring field since 2006. I have noticed that before 2008 majority of people getting to their boats would always head out, even if for just a few hours. Since 2008 I noticed a trend of many, perhaps as many as half of the people staying put and using their boats as floating summer homes. People with new or almost new boats are the biggest stay putters so to speak. But it makes perfect sense. In our neck of the woods on the water summer home is a few millions or at least $1mil. A few houses away from the water would still command between $500K and 1mil and a summer cottage even 5-10mins drive from the beach commands $300-500K. So getting a brand new Searay for $150-200K and using it for a beachfront summer home with 360 degree ocean view is a great alternative. Throw in the fact that boat's off season storage, haul outs/launches, etc would cost no more than the annual real estate taxes and maintenance on the summer house and you've got a winner.

[ctl411]

Originally Posted by jtsailjt

I feel like the thing to do is offer about 5-10% less than the boat is worth for YOU to own it and then "allow" the seller to talk you up a couple % so he can feel like he didn't give it away. I wouldn't even want to know the financial situation of the selling party, as long as he has clear title to what I'm buying. I'd also make no apology for offering much less than the asking price, or feel offended if my offer is turned down flat. UI To me, that's not even a consideration. Yes, offering 50% of the asking price will probably get you turned down more often than not, but if that 50% is all the boat is worth to YOU and the owner wants to keep it at that price, then you move on and find another boat that you can buy for whatever value you think it's worth. No harm done. Sometimes sellers surprise you when confronted with a low, no strings attached offer for reasons of their own and that's none of your/my business. Just be concerned with what it's worth to YOU, not what some third party would think was "fair!" Cash is king and every boat owner knows that it is costing him money for every day he keeps a boat he isn't using or no longer wants to own.

This is what I do also. What something is worth to someone else doesn't matter. It's the buyer/seller at that moment that counts.
This may be the case with your 47, did you buy it in Connecticut? Nice boat at a good price if you did.
Just wasn't for me that "day" ....

[jongleur]

Originally Posted by Polux

I don't understand what you mean. What establishes prices on a market is demand and offer. If a boat does not sell in a reasonable period of time it means that its price is too high and nobody wants it at that price.

The highest market value of a boat is the highest price a given boat can be sold over a reasonable period of time. If it does not sell in a reasonable period of time than it is not reasonably priced. It is over priced.

I agree completely with you.
Morality is a separate issue.

[jtsailjt]

Originally Posted by jongleur

I agree completely with you.
Morality is a separate issue.

I can understand where morality would be an issue if you pointed a loaded gun at the seller as you made your offer. But if he is feeling pressure to sell that you have nothing to do with causing, than it's not your problem and any offer you make is as "moral" as any other, and any decision that seller makes about that offer is completely "moral."

[Polux]

Originally Posted by Colin A

The power boat market in the US is hurting as well (I think it's at about 80% or pre-recession levels.) But inside of the motor boat sales is a trend towards large boats (over 50') and towards day boats. Sales of Sterndrive and inboard powered cruisers are less then half what they were before the crash and about 1/4 of what they were at the turn of the century. Large out board powered center consoles and walk arounds have taken their place in many cases.

Yes off course but that is not the point. The point is that after that sharp fall the motorboat market is not going down the same way the sailboat market is. Some boats, cruising boats over 44ft are even selling better than in previous years.

You only need to see the numbers regarding American boat shows in what concerns sailing boats and motor boats to see the huge disproportion in public interest and demand.

[ramblinrod]

Originally Posted by jtsailjt

I can understand where morality would be an issue if you pointed a loaded gun at the seller as you made your offer. But if he is feeling pressure to sell that you have nothing to do with causing, than it's not your problem and any offer you make is as "moral" as any other, and any decision that seller makes about that offer is completely "moral."

If one says something like this to themselves enough times, they may actually
Begin to believe it.

Fair market value is established by reviewing the average selling price of that year make, model of boat ( or nearest comparators) and making adjustments for condition, inventory, recent upgrades, deficiencies, and localle. This is the vessel worth. What any individual is willing to offer, does not establish worth. If a purchaser makes an offer and an owner accepts it, that is not necessarily the fair market value, that is the selling price. If I search the seven seas for
someone willing to sell me their fine example of a 2007 Benahuntalina 46' for $3000 what am I doing? Answer, clearly trying to find someone I can take advantage of. It may upset someone to acknowledge, and they may deny, deny, deny, but that is exactly what is happening, when they are seeking to purchase a vessel for considerably less that what it is worth.

[valhalla360]

Originally Posted by ramblinrod

Who said to dig into anyone's financial situation? Not me.


It isn't charity to offer a seller what an item is worth, and more than what they may be forced to accept, if they have no other offers pending, and are in trouble.

I don't donate to charity unless I see how the money is being spent and I make sure it isn't encouraging poor behavior (seen to many wasteful charities and people in a bad position because of choices they made), so if it's not worth digging into their financial situation, I'm not donating to charity. If they aren't willing to share their situation, they must not be that bad off. I've helped a number of people out over the years but after seeing a friend blow the money and back in the same situation a month later, I took up the approach that before money is handed out, we sit down and go over their financial plan. It's amazing how many people aren't in nearly as bad of a financial situation as they make out but when you show them how they can fix it themselves, they typically just get mad at you for not handing out cash. I'm certainly not handing out cash to a stranger without knowing what the situation is.

It's definitely charity to offer more than what they would willingly accept. An item is worth what a willing buyer and willing seller agree to by definition. If there are no other willing buyers offering more and the owner is willing to accept it, the low offer is what it is worth by definition. Unless I have knowledge that they are in a tight bind and decide to offer charity, the offer that is accepted is what the boat is worth.

As stated in previous responses, the "real value" is nebulous and highly variable in the cruising boat market. Anyone claiming they know the "real value" of a boat is blowing smoke up your....

[Paul L]

Originally Posted by ramblinrod

If one says something like this to themselves enough times, they may actually
Begin to believe it.

Fair market value is established by reviewing the average selling price of that year make, model of boat ( or nearest comparators) and making adjustments for condition, inventory, recent upgrades, deficiencies, and localle. This is the vessel worth. What any individual is willing to offer, does not establish worth. If a purchaser makes an offer and an owner accepts it, that is not necessarily the fair market value, that is the selling price. If I search the seven seas for
someone willing to sell me their fine example of a 2007 Benahuntalina 46' for $3000 what am I doing? Answer, clearly trying to find someone I can take advantage of. It may upset someone to acknowledge, and they may deny, deny, deny, but that is exactly what is happening, when they are seeking to purchase a vessel for considerably less that what it is worth.

You have twisted the definition of fair market value to be almost unrecognizable to make your argument . In this context a fair market is where the seller and buyer agree to a price in an arms-length transaction and the market itself is reasonably transparent .

Your example of searching the seven seas for a low price and thern trying to turn that into some moral failing is nonsense. The value of boat to a buyer and a seller includes in part where it is located. A boat up a river in a remote central American jungle 4 hours from the closest airport is generally not going to sell for what the equivalent boat located in Annapolis would


It's a business transaction not a dating relationship.