BUC Values/Asking Prices/Ratings

[PalmettoSailor]

In a couple of recent threads folks have mentioned lots of nice boats on the market at below market prices. I have not seen that here on the bay. I've made special trips to see several disappointing boats (a CS, a Tartan and a couple of Sabres) and some Catalina's I considered average. All of these boats had asking prices well above the BUC value.

As an example, this 1993 Catalina 36 listed on yactworld for $82K.

http://www.yachtworld.com/core/listi...=quick&rid=101

BUC value on this boat is about $58-62K, I haven't seen this boat and it has some nice stuff but isn't really "loaded" and based on the specs it seems the sails and rigging are all original, however the asking price isn't even close to BUC.

I've looked up the book numbers on several of the boats we've looked at, and none of them have been within or even close to) the BUC range and none were what I would have considered in outstanding condtion (some could only be described as a POS).

Apparently A) the market isn't that bad, or B)The BUC people are are smoking crack or C) Sellers are smoking crack.

[sailingdog]

Just remember that asking price is often inflated far above what the selling price eventually ends up being.

Also, BUC values only really work for fairly common boats, rather than less common boats, since it is dependent on regular sales for a basis for price setting.

Most sellers are on crack. The BUC people might be on crack, but it depends on which boat you're talking about. The market for good boats at a good price is never that bad.

[xort]

The seller is on crack or more likely they are hoping for a sucker buyer on crack.
If you could sell for 30% over market, wouldn't you?

I sold my boat for 20% over BUC value, am I a bad person?

Sellers will most likely try to get top dollar for some period of time, then cut the price and it sells fast.
Put in an offer you are comfortable with. When you get turned down, the broker will keep your number.
Patience!

[PorFin]

If the owner of the '93 in MD is smoking crack, the crazy Cannuck on Lake Champlain -- who has his '93 C36 listed for $113,367 -- is smoking Ultra-crack!

Sheesh -- as somene who's also shopping for a C36, I really REALLY hope that they don't go for anywhere close to list price.

[sailingdog]

MLS-

Just remember that you should only offer what the boat is worth to you... minus any repairs and required modifications/upgrades are going to cost you... If the seller can't accept that...then you're not going to get the boat...

If you really want the boat... then you're going to have to pay a slight premium for it generally. Not necessarily a 30% over BUC premium, since the boat market isn't as bad as the real estate market was eight years ago... but a bit over what your bottom line price would have been.

[PalmettoSailor]

Originally Posted by xort

The seller is on crack or more likely they are hoping for a sucker buyer on crack.
If you could sell for 30% over market, wouldn't you?

I sold my boat for 20% over BUC value, am I a bad person?

Sellers will most likely try to get top dollar for some period of time, then cut the price and it sells fast.
Put in an offer you are comfortable with. When you get turned down, the broker will keep your number.
Patience!

No, but it probably means you had a nice boat.

I'm just amazed that in an environment where our stock portfolio's feel like a roller coaster, credit is tight and many many folks are worried about loosing their homes that prices on "average" boats are so far above "average".

Don't lending institutions look at these values? Wouldn't they balk at loaning money to the crack smoking sucker that was willing to pay the buyers 30% premium? What about getting it insured? Can you insure your $60k boat for $80k just because thats what you paid for it? I'm sure in practice they rely on the surveyors valuation, but it seems the book values would carry some weight if they are in any way based on past sales.

[sailingdog]

MLS-

Just cause someone is willing to buy a boat at an overinflated price, doesn't mean that a bank is willing to finance said boat at that price. I think most of the banks are far more conservative about how much they'll lend, especially on a depreciating asset...which most boats are.

I think the tight credit, stock market fluctuations and the possibility of losing their homes is why they're pricing the boats so high... if they can find a sucker to buy it overpriced as it is... then they're that much more ahead.

[Faster]

The boat you're looking at, the C36, seems particularly subject to regional influences based on popularity. In the PNW these boats routinely list at the prices you mention; well above BUC values.

Even the pre MKII models up here will list well into the 50 and 60Ks with the newer MKIIs going into the 6 figures. One would assume they are selling not too far off that or the market would pressure these prices down somewhat. Either that or these boats have been listed forever and none of them are moving.

It's not as if it's a rare or uncommon model - if anything Catalinas should be the more accurate in the BUC book due to the large numbers and large numbers of deals made on them.

In the end you'll decide what you're willing to pay and you have to take the surveyor's estimation into account esp if you want reasonable insurance coverage. Our carrier has never objected to coverage based on the surveyed market value - but in Canada there's no real "book" in play.

[Cruisingdad]

This subject has been brought up many times... in fact, not too long ago by yours truly (me). http://www.sailnet.com/forums/showth...ghlight=market

I will give you my opinions and see if I can point you on to another thread I started and discussed the market. I will also say as I just purchased a boat today after MANY months of looking, I can give you a pretty good read on the market.

BUC seems to be a poor judge of value anymore, IMO and that of other surveyors I have spoken to. Soldboats.com has the better represetation. And even there, remember a Catalina is NOT a Catalina.

For example, let's say you have 2 Cat 36's. One of them (Catalina36A) was a stripped boat but fairly well taken care of. It has no water damage and no real "issues". We will value that 36 at 100,000 (just to use round numbers). Now, let's compare that to Cat36-B. This boat has also been well taken care of and has a chartplotter, radar, a/c, leather, bimini and dodger, they even had a generator on it.

That package, though not always apparent, will add a lot more value to the boat. Generally how it is done is that they find a boat that LOOKS (with look being the VERY operative word) to be in the same condition. Then they add.... well, 3k for ac, 2k for leather, 8k for generator, 5k for electronics. You now have a boat that will value close to 20% more than the other boat.

That is a VERY straight forward comp. It is also VERY hard to get straight forward comps. Since it is close to impossible to know exactly what shape the other C36's that sold were in, it is very difficult to put an exact value on them. In fact, it is VERY hypothetical.

How does all this relate to your problem? Well, I will say that in finding the value of a boat, the buyer basically set's it. That means you need to be a very educated buyer. I will use our Tayana 42 that we just bought as an example. Go to Yachtworld and type in Tayana 42 with the ranges from 1985-1990. That is a good range, and not far off of the reality that would be used in determining the value for a boat and guessing where to start shopping. Now, look at the range between these boats. Your initial reaction is that some people are realistic and some are (using your phrase) smoking crack. I have found after many thousands of dollars in travelling the country, that the boats that are the most expensive are probably about the only ones you would consider buying. The low balls are that low for a reason, and it is not because the seller is a philanthropist. You may have hull damage or water damage or poor sails or any millions of other things that are not apparent in pictures. HOWEVER, and this is the BIG HOWEVER, those low balls really play havoc on the market because they now throw off the real selling price of a boat you would actually buy. So when you go on one of these boats with the thought of, "let's just see why this idiot wants 100k more for this boat than one that is the same year," you realize it is the only one worth purchasing and you realize that is what you will have to pay.

NOW THE REAL KICKER: Your survey comes in and may very likely be less than the value you agreed upon for the boat. This happened to us. You can either walk or you will have to pay the difference out of pocket (assuming you do not negotiate the difference). Why? Your bank will only loan 80-90% of the SURVEYED amount... not the agreed selling value. Thus, you have to make a hard choice.

So what is the market? I think it is a tough market for selling a boat. But at the same time, I will say that a very good boat that is attractively priced will sell. The issue is that there is a LOT of junk (especially in Florida and parts of Texas) that is dragging down the market with number of units and selling price. Let's face it - there will always be the sailors who look for "bargains" no matter what kind of capital will be required to bring them up to sea worthiness. And because of that, the solid boats are taking a hit. But I think if you look long enough, you will find a fair to good deal on a very well kept boat. I do not think you will find an awesome deal on a very well kept boat... only a fair to good deal. But if you are not willing to potentially pay above and beyond for a very well kept boat, you need to do the best you can about finding real costs on the boat in question and see how much wiggle room the owner will give. If not much wiggle room, you can save the airfare, travel costs and frustrations.

- CD

PS For your information, we were dropping about 2,000 for ever long weekend.shopping boats (that was just me and dad). THis included airfare and hotels and cars, etc... but still a pretty hefty number that gets expensive quickly. Regarding SOLDBOATS, you can get that info from the broker or from the surveyor you will use. If they will not print it out for you ahead of time, don't bother getting on a plane.

[cardiacpaul]

"Why? Your bank will only loan 80-90% of the SURVEYED amount... not the agreed selling value. Thus, you have to make a hard choice."

EXACTLY!

in my experience, Dad has nailed it.
You also have to remember sellers true motivation for selling may have NOTHING to do with actually selling the boat.

The owner may have it listed because the spouse wants out
"Honey, I have it for sale, its a bad market out there (because I've priced it 50k over what its worth)"

maybe financial problems,
"My McMansions ARM is being reset, the payment is going up 500.00"

maybe problems with the boat itself.
sails blown-cost to replace, 15k, motor neglect, 8-10k,
hurricane settlement... oh man, not pretty.

in a nutshell, throw away the slide rule, close msexcel, forget the brokers and the sales guides. Do your own research, walk a lot of decks, and pay....
WHAT THE BOAT IS WORTH... TO YOU