Hi Harry,

Honored I'm sure that you grace this thread with your renouned wisdom.
I've enjoyed reading your postings with relish time and time again!

I guess that I've figured that there is no "official pricing" on boats,
as it is a largely unregulated market, and because many folks don't buy
them based on rationality but after getting hooked at a Marina.

I can well understand that used prices are not an exact rocket science.
Among the zillions of points of view one can envisage, I see two
present in this thread which tend to cancel one another out:

A. Past prices make up the market, and thus an average of all prices
of boats sold is the real used boat price. The premise here is that
nobody in their right mind will sell you a comparable boat for
substantially less than another one might have sold for in the recent
past. This approach is however fundamentally flawed, because it fails
to take into account the people involved. Some folks might find it of
great value to unload their used boat fast at a very low price. Other
folks might never be able to live down the perceived loss of their
initial investment and prefer to wait for an imaginary buyer, leaving
the task of selling the boat to their heirs upon their demise. So the
real market price would be what two rational people, a buyer and a
seller, come to agree upon as a fair and "rational" price based upon
costs incurred by the initial owner, costs which will be transfered
with the purchase to the next owner, with some allowance for emotional
attachment of either party distorting the mix.

B. Extrapolations of technical and financial parameters establish the
value of the boat. Similarly to a cost accounting process, the
materials used, their ageing characteristics, their condition, a survey
of the boat, its features and options would constitute a rational basis
for estimating the value and price of a used boat. This approach also
fails to take into account the human factor. We're dealing with
emotional and sometimes irrational people who invest their ego and not
just their money into boats. We're talking dreams, aspirations,
expectations, and even neuroses getting projected into a boat's
purchase or sale. This means that in some cases both the buyer and the
seller make a deal and each feels that they've been burned. It can also
mean, though surely less often, that each party feels that they've made
out like bandits with a sweet sweet deal. Selling a used car I once
experienced that. It had given me so much trouble I advertised it well
under market price. The buyer was so excited he mailed me a check
without even seeing the car. He was a happy sailor. I was happy too, I
would have paid to get rid of it!

So please forgive me if I don't align my checkbook with actual sale
prices. Other people paid those prices for their own reasons which may
be sensibly different than mine. Prices tend to be "all over the place"
especially when, as you justly state, there is no organized used boat
market. So I'll keep my own grey cells as my best basis of pricing,
whether books, brokers or sellers think otherwise. I guess the real
market price I will end up paying (this will then become a "real" past
market price) is going to be what I'll be willing to pay = a lot of
boat for a lot of money.

Best,

Rich

Hi Harry,

Honored I'm sure that you grace this thread with your renouned wisdom.
I've enjoyed reading your postings with relish time and time again!

I guess that I've figured that there is no "official pricing" on boats,
as it is a largely unregulated market, and because many folks don't buy
them based on rationality but after getting hooked at a Marina.

I can well understand that used prices are not an exact rocket science.
Among the zillions of points of view one can envisage, I see two
present in this thread which tend to cancel one another out:

A. Past prices make up the market, and thus an average of all prices
of boats sold is the real used boat price. The premise here is that
nobody in their right mind will sell you a comparable boat for
substantially less than another one might have sold for in the recent
past. This approach is however fundamentally flawed, because it fails
to take into account the people involved. Some folks might find it of
great value to unload their used boat fast at a very low price. Other
folks might never be able to live down the perceived loss of their
initial investment and prefer to wait for an imaginary buyer, leaving
the task of selling the boat to their heirs upon their demise. So the
real market price would be what two rational people, a buyer and a
seller, come to agree upon as a fair and "rational" price based upon
costs incurred by the initial owner, costs which will be transfered
with the purchase to the next owner, with some allowance for emotional
attachment of either party distorting the mix.

B. Extrapolations of technical and financial parameters establish the
value of the boat. Similarly to a cost accounting process, the
materials used, their ageing characteristics, their condition, a survey
of the boat, its features and options would constitute a rational basis
for estimating the value and price of a used boat. This approach also
fails to take into account the human factor. We're dealing with
emotional and sometimes irrational people who invest their ego and not
just their money into boats. We're talking dreams, aspirations,
expectations, and even neuroses getting projected into a boat's
purchase or sale. This means that in some cases both the buyer and the
seller make a deal and each feels that they've been burned. It can also
mean, though surely less often, that each party feels that they've made
out like bandits with a sweet sweet deal. Selling a used car I once
experienced that. It had given me so much trouble I advertised it well
under market price. The buyer was so excited he mailed me a check
without even seeing the car. He was a happy sailor. I was happy too, I
would have paid to get rid of it!

So please forgive me if I don't align my checkbook with actual sale
prices. Other people paid those prices for their own reasons which may
be sensibly different than mine. Prices tend to be "all over the place"
especially when, as you justly state, there is no organized used boat
market. So I'll keep my own grey cells as my best basis of pricing,
whether books, brokers or sellers think otherwise. I guess the real
market price I will end up paying (this will then become a "real" past
market price) is going to be what I'll be willing to pay = a lot of
boat for a lot of money.

Best,

Rich

Your comparison iwth the dot.com stocks is interesting.

There are two factors to consider whenever we buy anything. Market, and
value.

When the dot.com craze was in full swing, many people wondered whether
fledgling companies with no history of profitability could really be
worth 10 times their assets right out of the gate and whether those
prices should be doubling every few weeks (or faster). That was
certainly a legitimate question about the "value" of those stocks.

However, if the same people wondering about the value of dot.com stocks
actually wanted to own any, they would ultimately be forced to do so at
the market price, whether that price was in line with the subjective
values they assigned to the stocks, or not.

Fortunately the market for used boats isn't as rigid and uniform as the
market for securities.
The principle remains much the same, however. Market values are
established by what the boats actually bring in the marketplace, even
when a good case can be made that the boat *shouldn't* be worth that
much.

If it's any comfort to you, realize that the broker will usually be
grinding on the seller to come down to a number closer to your price at
least as hard as he or she will be grinding on you to come up to a
number closer to the seller's asking price.

As far as sending earnest money to out of state brokers you have never
met and for boats you have never seen.......don't do it, please. See if
you can find one local broker you like and trust, even if that party
doesn't have a listing right now that matches your want list. (In most
areas of the country, 10-year-old 30-foot cruisers are likely to be
somewhat scarce at the $30,000 level). Use the local broker you like
and trust to represent your offers. If you make a deposit on an out of
state boat through your local broker your money goes into the trust
account of the
local guy you like and know- not some guy 1000 miles away who may be
doing business out of the phone booth at the back of a waterfront bar.
Your broker will share the sales commission with the listing broker, so
it won't cost the seller any more and shoudn't cost you an extra dime.

Hi Gould,

Thanks for your futher analysis.

QUOTE:

"There is a simple answer to your question concerning boat
depereciation. The boat that sold for $100,000 ten years ago and still
brings $100,000 today does so not because the boat hasn't aged or worn
out, but because the same boat today now sells for $200,000 new. Used
boat prices are justified by comparing to the cost of purchasing the
same thing new, more like houses than cars. (Likely due to the fact
that unlike cars, boats aren't shot after 5-6 years of average use).
Unlike real estate, most boats won't actually appreciate but if the new

price goes up high enough, fast enough, an older boat often sells for
the same amount of pre-inflated dollars ten years or 20 years after the

fact than it did when new."

END QUOTE

I'm sure you've nailed it he the new boat market is still in a
bubble. I've seen the exact same model 12.5 meter boat made by Aquanaut
which was offered to me NEW at a boatshow ten years ago for $100k
selling now for over $300k. If this holds true for used boats, some of
us may well wait to buy until the economy gets hit with hard enough a
sidebelt that some boatbuilders either close up shop or crunch their
pricing numbers significantly lower.

However, I don't necessarily think that you can establish a positive
mathematical relation between new and used boat prices, as they are
possibly not the same market population. For example, I for one would
never buy a new boat at today's prices although I regretfully didn't do
so ten years ago as per the example above. This may hold true for the
pricing of very recent used boats, when due to highly justified sticker
shock induced by market gouging pricing, new boat buyers try to soften
the blow by passing on the initial depreciation to a previous owner.
But those buying 10 to 20 year old boats are usually not, to my mind,
debating spending $200k on new versus $60k on used. Just my humble
opinion.

Respectfully,

Rich

Hi Gould,

Thanks for your futher analysis.

QUOTE:

"There is a simple answer to your question concerning boat
depereciation. The boat that sold for $100,000 ten years ago and still
brings $100,000 today does so not because the boat hasn't aged or worn
out, but because the same boat today now sells for $200,000 new. Used
boat prices are justified by comparing to the cost of purchasing the
same thing new, more like houses than cars. (Likely due to the fact
that unlike cars, boats aren't shot after 5-6 years of average use).
Unlike real estate, most boats won't actually appreciate but if the new

price goes up high enough, fast enough, an older boat often sells for
the same amount of pre-inflated dollars ten years or 20 years after the

fact than it did when new."

END QUOTE

I'm sure you've nailed it he the new boat market is still in a
bubble. I've seen the exact same model 12.5 meter boat made by Aquanaut
which was offered to me NEW at a boatshow ten years ago for $100k
selling now for over $300k. If this holds true for used boats, some of
us may well wait to buy until the economy gets hit with hard enough a
sidebelt that some boatbuilders either close up shop or crunch their
pricing numbers significantly lower.

However, I don't necessarily think that you can establish a positive
mathematical relation between new and used boat prices, as they are
possibly not the same market population. For example, I for one would
never buy a new boat at today's prices although I regretfully didn't do
so ten years ago as per the example above. This may hold true for the
pricing of very recent used boats, when due to highly justified sticker
shock induced by market gouging pricing, new boat buyers try to soften
the blow by passing on the initial depreciation to a previous owner.
But those buying 10 to 20 year old boats are usually not, to my mind,
debating spending $200k on new versus $60k on used. Just my humble
opinion.

Respectfully,

Rich

Hi Don,

Glad to see you made good, especially if you're looking to sell your
Sandpiper 565. So it looks like there aren't quite enough boats out
there to satisfy demand sufficiently - unless there are too many of
some types of boats that can't find buyers, and categories of actively
marketed overpriced new boats creating a strong demand for too few used
models which meet the same demand?!?

Wow is this stuff getting confusing.

Rich

Gould,
You are incorrect. The buyer can negotiate everything, even the brokers
commission fees. The seller is only interested in walking away with "X"
dollars. If the broker reducing his commission allows the seller to meet
his objectives and complete the sale, it is up for negotiation. The broker
may decide not to reduce his fee, but the buyer can still negotiate it.

Ever home I have purchased was the result of the broker taking 60% of his
normal commission rate. Since I was dealing directly with the listing
agent, the listing agent and broker both made more money than if they shared
the sale with another broker. When I presented my proposal, every brokers
initial response was NO. When they realized I was willing to walk away,
they were willing to reduce their commission and still come out ahead.

It was a win - win for everyone.




wrote in message
oups.com...
It was written:

Everything is negotiable. Everything. The boat's price, the brokers
commision, fees.

*******

By the way: if the broker decides to negotiate the commission it will
be with the seller (who has to pay the commission) rather than the
buyer.

Gould is very knowledgeable, but he looks at all aspects of buying and
selling boats from a "used car or used boat salesman" prospective. If you
find a boat you like, you can use the NADA book price as your negotiating
tool. If it really is a seller's market, they may not accept it, but that
is part of negotiating.


wrote in message
oups.com...
Hi Gould,

I much appreciate your advice, I realize from the groups that you're a
pro and have even worn the white shoes. grin

But I'm no angry husband shooting out of the bedroom window, just a
bloke looking to sink his loose change into a floating mistress, less
trouble than a walking one - even if it sinks!

I guess all the guidebooks and NADA and BUC etc. are way off in pricing
the boat I want (used to want?) because I've only seen one that did
actually sell at the guidebook price. (Got ready to arrange survey to
find another guy snatch it up faster than me.) Banks which think that
"every boat on the market is pretty well overpriced right now" may not
have it all figured wrong. Consumers have been known to get carried
away in buying stuff for far more than it is worth rationally. Modern
Marketing is chock full of concepts and techniques to get people to
attribute rational value to things for irrational reasons. You can
argue that things are worth what you can get some people to pay -
because the market sets the prices. This is why an egg is worth a
million dollars to a banker in a famine. This is why a glass of water
is worth a billion dollars to Bill Gates in the middle of the Sahara.
But is that a reason why an egg or a glass of water are really worth
that much?

A given boat might be worth more to somebody else in some other
situation. But its "real value" is what it is worth to you. The same
holds true for Dot Com Stocks. Were they really worth as much as what
some people paid for them? Ask those who lost their entire estates in
the Stock Market bubble, and just maybe, ask a few who bought boats
without being properly informed and prudent. I may not understand the
subtleties of the used boat market, but to me, a ten year old boat is
worth LESS than it cost ten years ago when new. Banks need to have
foresight to avoid defaulting loans. Thus they also need hindsight and
cannot allow irrational pricing to guide what they will underwrite.

If these boats are really worth close to what their advertised prices
are, I'm glad to hear that the used boat market isn't as rough as folks
have claimed. I didn't realize that 10 year old 30 foot cruisers sold
between $50k and $100k like hotcakes. The price guidebooks all put
average retail at around $30k, so I guess I should either throw away
the guidebooks or forget about buying a boat. 10,000 lbs of 10 year old
plastic at $10 per pound, maybe I should have invested in plastic
futures? Maybe it appreciates with age like old wines, getting ooohs
and aaahs at every gelcoat crack like antiques with wormholes.

Please don't find my irony disrespectful. When you say "Throw the price
guidebook away." you must be sensitive to the fact that we know you
used to be a broker. It risks smacking of selfserving logic, even if
that is the furthest thing from your intentions and you no longer are
active at that job.

Broker has POWER. They know the market like nobody else. They have
access to all the databases. They have informal networks. They've heard
all the stories from colleagues on how all these pigeons come along for
an expensive plucking. There's a sucker born every day, and most of
them eventually want to buy a boat. They may be honest and altruistic,
wishing a happy life to buyers and sellers alike. But then again they
may not. And with the power advantage they have over buyers, we're in
deep trouble unless prepared for the worst, even if hoping for the
best.

Regardless of the worth of Price Guidebooks - throw away or not -
someone here isn't doing their job right, either the pricing
authorities, or the brokers. Why do banks and insurance companies use
them? Because they are worthless and should be thrown away? Because
they only know loans and not boats? Or because they obey principles of
logic in price determination, and not the going rate for a sucker? A
twofold difference is a 100% error. Somebody is 100% wrong, unless each
is 50% blind.

How can the Owners of the boats be the ones who set the asking price?
This may be true legally, but in practice, who would have the gumption
to try to sell their boat for more than double book value? Obviously
they are ill advised by overly greedy brokers who, by polluting the
market by overpriced units, are maybe a big part of the used boat
market's sales difficulties. Who else tells them what price is the
right price? Nobody on commission will be happy to sell for a lower
profit a boat that they can hope to hussle some innocent buyer with
using the emotional appeal of a boat as bait. The sellers are thus
hostage to an unethical brokerage situation. Clearly, the system is
broken.

I don't mean to give you a hard time, especially as you are a valued
contributor to these groups and have been candid on many occasions
proving your good faith. But a newbie buyer is bound to see things from
a different standpoint than a seasoned seller. Maybe, just maybe,
there's some sense in the counterpoint too.

If having the market "controlled" by brokers isn't an ideal world, the
problem remaining is that in a market dominated by brokers, those
sellers who would be willing to sell at "normal" rational used boat
prices take the easy road and often choose sell through professionals.
Brokers then talk up their boat and flatter their egos and appeal to
human greed, some say it is just to get the listing, but maybe brokers
also dream of manipulating buyers into paying more? Those who are
willing to take the hard path of selling their boat themselves without
a broker are either very rarely doing so because they have become wise
and wary of brokers. It is likely that they are folks who are even more
greedy than brokers, and think the broker's overestimation of their
boat is low (after all it has been enobled by their ownership, hasn't
it?). They will believe that they can sucker you better than a pro, and
will want more $ plus the broker's fee to boot. Not exactly ideal
sellers to deal with.

To resume I'm not about to make an offer on a boat at close to its
ancient new price, especially when its best years are gone and NOW is
when the problems are pushing their owners to unload them. They have
roughly 400 hours on gas engines, and enough wear that the cosmetics
will soon show that their better days are over. When I buy something
new, I expect to sell it for something less down the road a decade
later of wear and tear.

Just possibly there is a MicroMarket for 30 foot pocket cruisers due to
recent gas price hikes - are folks downsizing their boats trying to cut
fuel costs? Most brokers seem to say that those bailing out of their
financial shipwrecks are selling to move up to a bigger boat. Even a
lame newbie like me should know better!

For those of us nonetheless willing to endure a "beating" in terms of
purchase costs, maintenance costs, marina costs, upgrade costs, repair
costs, and unexpected costs, as well as those I've forgotten, we must
enter the (m)arena like Gladiators - sizing up the odds of surviving
the encounter. And fom what I've seen so far, unless some of you folks
in the know give me some failproof pointers, I'm dead meat looking for
a barbecue grill.

Telling me that dealer list prices are correct, and that one can make
offers between 5 and 10% under - and calling such offers LOW - makes me
wonder if somebody has been eating strange brownies? Broker used boat
prices are obviously over inflated, well beyond what anyone might
believe is ordinary pricing with a small margin of built-in negotiating
elbow room. Either brokers have a tougher job than I thought with
sellers needing delirious cajoling over months of weening until they
realize they can't actually make a profit on owning their boat for
years, or they're out to empty my wallet with a vengeance. I'll let you
decide which is more likely.

My market search is nationwide, and thanks to your fine advice, I will
start making my offers in writing, clearly the only way to go. However,
I'm a bit worried about mailing brokers which I do not trust
intrinsically my personal check for 10% of the amount, before even
scheduling a survey and making sure the boat is sound. However, I guess
that there is no other way to get a broker to communicate a "low offer"
(read real market price for this buyer). Heck, if I was selling a boat
and not getting any nibbles for a year, I'd consider an honest offer
which matches Price Guidebook numbers. Why wouldn't other people?

I much appreciate your friendly advice about seller psychology, and
what not to do when making an offer. I will follow it strictly, and
keep the bickering to monetary issues, ie what I'll pay and what
they'll take, without trying to explain or argue. It will save everyone
strife, and keep the situation sane. Especially if, as you suggest, it
will only cause aggravation and give opposite results to those hoped
for.

So I thank you for your advice, which I will respect dutifully, even if
I don't quite see eye to eye with your philosophy concerning pricing of
used boats: definitely not the price that a lonely fool, or even an
army of suckers, would be willing to pay given the chance to lose their
shirt.

Cheers,

Rich (not that rich, you will notice from my posting)

I have had my 2002 SeaRay 176BR on the market since January. I figured
I would put it on the market early in the season and just see what
happens so I gave it to a local broker. The broker (Brystar marine)
sells for whatever they can get above the sellers price. Now I just
want to get rid of the boat payment and I am not interested in making a
profit. I tell him that I only want 11,000 for the boat which is what
is still owed and I figured he would still be able to make plenty of
profit from the sell since the blue book value is around 13,000. His
greed is very remarkable though. He has the boat listed at 14,500. This
is over 30%! I didn't mind for at the time being because I didn't
think it would sell before spring anyway and I am just biding my time
until the weather improves and the market starts getting hot. I
recently asked how things are going with the sell and he had the nerve
to try to get me to lower my price! I know it's all part of the game
but the greed is just amazing. I have given him his thirty-day notice
and if he can't sell it in that period I will put it on the market
for 11,000 just in time for the weather to be beautiful.

Chris

There is an old saying about Brokers.

"You can tell if a broker is lying if his lips are moving."


"Mule" wrote in message
oups.com...
I have had my 2002 SeaRay 176BR on the market since January. I figured
I would put it on the market early in the season and just see what
happens so I gave it to a local broker. The broker (Brystar marine)
sells for whatever they can get above the sellers price. Now I just
want to get rid of the boat payment and I am not interested in making a
profit. I tell him that I only want 11,000 for the boat which is what
is still owed and I figured he would still be able to make plenty of
profit from the sell since the blue book value is around 13,000. His
greed is very remarkable though. He has the boat listed at 14,500. This
is over 30%! I didn't mind for at the time being because I didn't
think it would sell before spring anyway and I am just biding my time
until the weather improves and the market starts getting hot. I
recently asked how things are going with the sell and he had the nerve
to try to get me to lower my price! I know it's all part of the game
but the greed is just amazing. I have given him his thirty-day notice
and if he can't sell it in that period I will put it on the market
for 11,000 just in time for the weather to be beautiful.

Chris