List and corresponding sale transaction information

[twarthen]

Have recently begun the process of looking for a used boat. Between the reading I've been doing (Vigor, Calder, Roth, and others) identified a boat in Europe I decided to get more information on. Contacted broker, asked for, and he sent, information on transactions of used boats involving that model over the past ten years: production year; list date and price; sale date and price. With that I estimated the average ratio between the list and sale prices (0.92, sale over list). Please note these caveats: I have no way of verifying that the data provided to me are accurate; these boats for which the data were provided are expensive (average list price of 268,000 USD; average sale price of 246,000 USD) so that the results may not apply to boats in other price categories; the ratio between the list and sale price (sale over list) on the 48 boat sample was from 0.67 to 1.10 (one boat sold for more than listed. Not sure how to interpret that, but list to sale date time lag on that boat was two years. For every other boat in the sample, the sale price was below the listed price); the data cover the ten year period from 2001 to 2010, and market conditions, currency exchange effects, and ?, will certainly have affected the data over that time frame.

What do I conclude? The data imply an average differential, on boats of this type, between list and sale price of approximately 10 percent. The more important conclusion is that there are data, available from brokers, which can help a prospective buyer get a sense of the current market differential between list and sale price. That is, do not consider my result, on this sample for a particular boat type, a reliable rule for use in determining an offer, but rather an exercise in trying to extract market information from historical market pricing, which other prospective buyers can also do.

[sailingdog]

There are far too many variables in boat asking/selling prices to really get a valid data set for making any kind of generalizations.

Rarer or more desirable models will often command higher prices than more common models. Boats in pristine shape can go for listing price or higher. Boats in lousy shape may go for much lower than the asking price.

[kd3pc]

way too much analysis...you will need to sail the boat, look at similar models and make your decision...

the boat is worth exactly what you or another buyer will pay...the ratios of the data are flawed from the get go, and to depend on flawed data to make an analysis is...well just silly..

depending on what any one else says will get you in to a bad situation

[twarthen]

First, "depending upon what anyone else says will get you into a bad situation" is amply demonstrated.

Second, the ratios are not "flawed". They are what they are, computed from the data available. The average may well not apply to any particular transaction, as virtually all means of most data sets are not replicated by any individual data element, and of course there are other significant variables affecting any given transaction which were not available to me to take into account. The range of values indicates that. The appropriate caveats to the analysis were noted.

Third, data, or, equivalently, information, including actual experiences in a given situation, and their analysis, about boat purchase transactions, or use of navigation charts, or GPS or compass readings, or engineering data on the strength of materials, or, well, you name it, is the only way I know of, other than trusting to luck and prayer, to understand and make better decisions when choices are available.

[tommays]

You seem to have formed your answer

But no two boats are the same as it would be rare that a boat in that range would even have the same brand of sail which in itself is a HUGE price variation

In my local market we have two Saber 402s at the same dealer one a 1996 and one a 2002 both being offered at the same 249000 USD and both show perfect

But in the fine print i can see the 2002 boat has much better sails

[QuickMick]

everything is a negotiation... i think another big factor in ask/bid/sale has to do with the state of the economy at the time, and im not quite sure you can quantify that. a couple of sales from a 'motivated seller' could really skew your data...

[twarthen]

Interesting. From the same data set I had, I could fit the list price against the production year of the boats. That produced a positive slope in the list price by production year of approximately $14,000. That, and the inference that list prices are, on average, greater than the corresponding sale prices, is an unremarkable result (most sellers hope for a naive buyer who will pay more rather than less, relative to the seller's perceived value of the item; as most things age, they lose value). The actual level of the trend in list prices, by production year, is, of course, uncertain, but it is reasonable to me that the older a boat is, the lower its value, on average, in general.

Before I provoke more comments about the uselessness of analyzing such data, here are some more caveats:
1. Of course the right price for any transaction, whether for sailboats or tomatoes, is what a particular seller and buyer agree upon for an exchange of a particular boat or tomato for a particular amount of money, but in my opinion, a prudent buyer would attempt to find out what other buyers paid for their boats or tomatoes, and how the price paid related to the buyers' expectations as evidenced in their list prices. But that's just me;
2. The data I used are a sample of the transactions over the past ten years on a particular make/model of sailboat. The results in themselves indicate a range, rather than a highly reliable fixed point. If the same analysis is applied to other boats, or to a different sample of the same make/model boats I am interested in, the results will most probably be different. I have not suggested that there is a fixed and reliable rule across boat purchase transactions for the relationship between list and sale prices which should determine what a potential buyer should offer relative to the list price for a particular boat. That decision requires more data and information on the specifics of the boat, and the circumstances of the potential sale.

[twarthen]

Agreed. Most/all of these transactions took place in Europe, but all were converted to dollars in the data which were supplied to me. Given the recent currency fluctuations, there is a distortion in the values provided in the data over the ten year span.

I expect that list and sale prices for boats in Europe now are lower than they would have been in the recent past, because of the recent global recession, and now the Eurozone debt concerns, but I don't know how to factor that in, and have lot's of other homework to do on understanding survey processes and evaluating boat systems.

[jrd22]

Interesting that you were able to get that type of info. from a broker. I would think that the more information you had the better while looking/negotiating for a boat.

[twarthen]

I was also surprised that the information was provided in response to my request, but I believe boat brokers do have access to global information on boat sales (analogous to a the real estate multiple listing services in the US?). It is possible, however, that the information could be specific to that particular broker, from their own records. Given the number of transactions, and the number of brokers in the same competitive space, I doubt that though.

In any case, I did not have direct access to the source of the data, and cannot vouch for its accuracy or authenticity. As far as list prices go though, they are not out of line with current listings, and the differential between list and sale price does not seem to me to be illogical or remarkable.