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  #1  
Old 11-21-2007
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Thoughts for those buying or selling...

Hi All.

I hope everyone has been doing well. Hopefully everyone has been playing nice??? At any rate...

It seems I have spent yet another worthless weekend (and part of the week) fruitlessly shopping for boats.

I won't say the type of boat, etc that we are looking at, but it seemed we had finally found the right boat. Beautifully cared for by an anal owner. There were a few glitches, but no massive hurdles. THEN... the survey. We did what I always urge everyone else to do - get a good survey and an engine survey. They really are not expensve. It probably saved our butts this time.

It seems the boat selling market has diminished quite a bit as of late (I am sure Cam can verify this one). Now while you would think that makes for a good time to buy, it also creates a big problem: Comps. Many boats have taken such a hit that when you do find a very well kept and cared for boat, comping it out will be near impossible.

If you are going to pay cash, then you will feel you can keep looking and save 10's of thousands out of pocket. If you are going to take out a loan, the bank will traditionally only lend 80% of SURVEYED value, not agreed to value. Big difference. That means you better really like that boat or get ready to write a very larve check up front in addition to your down.

Either way, it is a lose-lose scenario. Between that, insurance, cost of fuel to ship and the cost of slipping the tub - it may be tough to find a boat. Many of you that want to finance the boat may have some real problems as all of these issues add up. For those of you that do not and wish to pay cash, you better check ALL of your costs before signing on the dotted line.

No matter what, check Sold Boats.com through a broker or your surveyor. BUC seems WAY out of whack. Look at the highest sold boat in the last two year and compare equipment/comps from there. I realize (tongue in cheeck) that the boat you are buying is a much finer vessel than ANY that has ever been sold before, but the banks and surveyors will not see it that way so it may be fruitless to proceed if you are way above the highest comp.

SO what we have found in the market are lots of boats that are total junk bringing down apparent values. Then you have nice boats that people have dumped (probably to save their house, etc) that have deflated the market - but those are gone quickly. Then you have the truely nice tub that has been well cared for... but ain't no way that owner is going to sell it for what it is worth a few years ago so you will reach an empass. Because of the beforementioned factors, its value has decreased considerably. Likely that owner will own that boat for a long time until the market turns around.

Thus, a buyers market is not always a good thing. And in the end, you may be out many thousands of dollars only for a big suprise after you write all the checks.

Buyers be informed and sellers beware: It is a frustrating market right now, no matter which side you sit on.

- CD

PS I will not list the boat type other than to say it is a heavy displacement, blue water cruiser that is well made and respected. I am concerned the owner or others will know the boat... as they very well may. SO we will speak in generalities... ok?
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  #2  
Old 11-21-2007
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So what big items turned up in the survey?

(Sorry T- I somehow got into yours thread instead of mine... sorry about that) - CD
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Old 11-21-2007
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Thanks CD... I'm glad to be trying to sell a boat right now... NOT!

Here's one other gotcha with regards to loans... With all of the problems in the industry right now due to sub prime lending failures, banks are being very cautious in lending money. 3-4 months ago, I could have walked into any number of banks to get my loan for the boat we're buying. Today, it took me about 12 banks before I could find one willing to write the loan.
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Old 11-21-2007
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Quote:
Originally Posted by TSteele65 View Post
So what big items turned up in the survey?

(Sorry T- I somehow got into yours thread instead of mine... sorry about that) - CD
I do not know all the items yet, but the value will be well less than what we agreed upon... and that is with the surveyor being extremely liberal. The closest comp was about 20-30% off. Yes, I wrote that right: 20-30% off!!!

- CD
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Old 11-21-2007
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Apart from financing issues, what are the insurance implications? Do they prefer to insure for surveyed value or agreed value? Is there a cost difference in insuring it one way or another? Or do insurers do it either one way or the other, without option?

Very good topic, BTW. There are many implications in any market shift; and some of them are not obvious by any stretch.


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Old 11-21-2007
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CD,
Thanks for the analysis. One question, though... what's a comp?
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Old 11-21-2007
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CD
Sorry to seem dumb, but what is COMP.


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Old 11-21-2007
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CD -- a good (and for me, timely) topic.

Quote:
Originally Posted by Cruisingdad View Post
Now while you would think that makes for a good time to buy, it also creates a big problem: Comps. Many boats have taken such a hit that when you do find a very well kept and cared for boat, comping it out will be near impossible.
Please forgive my neophyte question, but what's a comp in this context?

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Old 11-21-2007
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A comp is a price comparison - against other similar boats that have sold in the past few years. There are databases that list all of the reported boats sold and the prices they reportedly sold for so you can figure out 1) How to price your boat, or 2) What to offer on a boat.
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Old 11-21-2007
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I believe he means a "comparable sale"; as in "boats of similar age and make sold for"
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Last edited by AjariBonten; 11-21-2007 at 10:43 AM. Reason: Edited to say ... GMTA, LOL
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