Where's the depreciation?

[john john]

Prices seem to be up on late model boats. How much depreciation taken on 2 and 3 year old boats these days?

 

[JB]

Re: Where's the depreciation?

Depends on make and model, john john.

 

[Slip Away]

Re: Where's the depreciation?

Depends on make and model, john john.

As well as the geographic location you are in and condition of the boat.

 

[tpenfield]

Re: Where's the depreciation?

Prices seem to be up on late model boats. How much depreciation taken on 2 and 3 year old boats these days?

Those are probably asking prices . . . often having little to do with the actual price that a boat will sell for. Particularly on late model boats as there can be loan/value issues.

However, the used boat market has shown some price improvement in 2013 based on some of the reference guides that I have browsed.

 

[gm280]

Re: Where's the depreciation?

Odd it isn't only with the boating market either. Used cars are demanding huge prices these days because so many are holding onto their older ones. And I see many using that same premises with boats as well. People are realizing they just don't need NEW as much as they used too. That NEW smell isn't worth thousands of dollar anymore...

 

[JimS123]

Re: Where's the depreciation?

I know many will disagree with me, but MY view is that depreciation means nothing to me. I won't buy a used boat unless its an antique or classic that I intend to restore. All my "daily use family boats" have been brand new and unmolested so I could equip and customize just the way I wanted them.

My first was a plywood runabout that I built myself. After 3 years I sold it for 4 times what I paid (OK, that doesn't count). My second was a FG runabout that we kept for 14 years. When I sold her she was in showroom condition (literally) and I got only $300 less than what I paid for the package deal brand new. My current boat just completed her 30th season and is also near showroom condition. If I sold her for what I was offered last year my total annual investment would have only amounted to $200. I don't consider that depreciatiin - I would have spent more than that each year just to rent a boat for a few days.....LOL.

The secret is buy what you want / need, and then keep it up and keep it long!

 

[dingbat]

Re: Where's the depreciation?

The secret is buy what you want / need, and then keep it up and keep it long!

What I want, need and can afford are three different things. I "upgrade" as income allows so keeping them a long time is not in the cards.

I too buy desirable, classic or undervalued boats. The "depreciation" on my last Grady was $1,000 over 6 years. The "depreciation" on my current Grady is going the other way. I have two standing offers on the boat. Both offers are 15-18% over what I have into the boat. Unfortunately for them, I like the boat and I've have just about every bell and whistle one would one want. Not withstanding a huge promotion in the future, I'll keep her a few more years.

 

[robopath]

Re: Where's the depreciation?

I think that the catalytic converter mandate may be a factor as well, at least for i/o's. Although you can still find new boats without them, they are getting harder to find.

Odd it isn't only with the boating market either. Used cars are demanding huge prices these days because so many are holding onto their older ones. And I see many using that same premises with boats as well. People are realizing they just don't need NEW as much as they used too. That NEW smell isn't worth thousands of dollar anymore...

 

[john john]

Re: Where's the depreciation?

Talking about 25' to 27' bow riders in the sea ray, cobalt lines. Freshwater if possible in the south. Someone said about upgrading. That's what I'm aiming for. If current trade is worth about 35 to 40% of new, would it be better to buy new or take one step at a time every couple years. Know it depends on money availability. Although not probably better, it seems easier on the mind to take smaller steps.

 

[dingbat]

Re: Where's the depreciation?

Talking about 25' to 27' bow riders in the sea ray, cobalt lines. Freshwater if possible in the south. Someone said about upgrading. That's what I'm aiming for. If current trade is worth about 35 to 40% of new, would it be better to buy new or take one step at a time every couple years. Know it depends on money availability. Although not probably better, it seems easier on the mind to take smaller steps.

figure out where you want to get to and why.

A lot if guys including myself "upgraded" the last time gas hit $4 a gallon. Three years later I'm rethinking the idea not for monetary reasons, but for ease of use. I went from comfortably boating alone to making things a lot harder on myself which reduced my usage considerably. Several of my friends have already downsized. I'm not ready to take that path but it see it coming for me sooner than later.

 

[MH Hawker]

Re: Where's the depreciation?

20 to 70 %

 

[tazrig]

Re: Where's the depreciation?

Basic economics really. As the economy is in such rough shape right now, fewer people are buying new boats which drives up the price on the used inventory thats out there.

 

[bruceb58]

Re: Where's the depreciation?

When I bought the Wellcraft in my signature in 2002, I bought it for around $22k and it was 3 years old with 70 hours on it. Original owner paid $42K.

The Pontoon boat I just bought for $13K was $26K in 2006 and it has 80 hours on it.

 

[tpenfield]

Re: Where's the depreciation?

An interesting thing with the depreciation aspect of new & 'newer' boats is that boats are mostly sold below MSRP. So, the starting point for value is below the common reference point of MSRP. However, that 'starting point' for value is subjective, based on how good a 'deal' is made on the initial purchase.

So, let's say a new boat is sold (therefore worth) at about 75% of MSRP . . . then perhaps a 1 year old boat would only be worth 65% of MSRP . . . a 2 year old boat 50-60% of MSRP and so-on.

 

[onewhippedpuppy]

Re: Where's the depreciation?

I agree, I've been shopping for a 22'-25' upgrade over the winter and have been surprised at the high prices. Even at 10 degrees with snow on the ground there really aren't any great deals. Genuinely nice boats seem to still be going at summer prices.

 

[Campylobacter]

Re: Where's the depreciation?

When I was shopping back in 2005-2006 I saw the same thing. I was looking at boats in the 2-4 year old range and only see a couple thousand off what I could get at the dealer new (and the majority of these boats were pretty beat). I kept looking until November when the dealer took another few thousand off and pretty much made up my mind for me.

I STILL see 4-8 year old similar models for for sale on craigslist for about what I paid then.

 

[oldjeep]

Re: Where's the depreciation?

Prices seem to be up on late model boats. How much depreciation taken on 2 and 3 year old boats these days?

2 Year old boat I just bought was:
$86,855 MSRP in 2012
$73,030 Actual sale price in 2012
$57,700 Actual sale price a couple weeks ago in 2014 (about 3K under NADA)

So there is still a ton of depreciation those first few years. I will say that for the same model boat I am seeing 2009-2012 in the same range as what I paid, so I think that the big depreciation hit has been taken. It also depends on when you buy. If you are willing to buy one in the middle of winter, you pay less.

Also, the 2014 version of the boat starts out over 90K - so that'll keep the used prices propped up some