Future values of today's Sea Rays?

D

Dave S

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TECHNICAL Contributor
Oct 3, 2006
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Upstate South Carolina
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I think we all agree that today's list prices are quite high compared to a few years ago. Just the same many dealers discount those prices heavily and along with factory incentives, the prices become more "acceptable" on many Sea Ray models. But the fact is that many models are not selling very well meaning that the numbers produced are a lot fewer than in the past. I wonder if some of todays models may tend to hold their values better in the future because of that. For instance, Sea Ray sold a lot of 260DAs but I doubt they have sold that many 270DAs (the replacement for the 260DA) in the past two model years. That means you won't find many for sale at any given point in time in the future. Because of that I tend to think that will mean these boats may have a better reseale value on the used market.

What do you think?

Dave
 
I believe that as the overall market improves, from my lips to God's ears, that all used boats will increase in value, or atleast hold their value. There will be demand but no supply. We need the market to recover, however. I went through this with real estate in the late 80's, prices dropped when the tax law changed but they then came back when demand began to out pace supply.
 
Dave S said:
I think we all agree that today's list prices are quite high compared to a few years ago. Just the same many dealers discount those prices heavily and along with factory incentives, the prices become more "acceptable" on many Sea Ray models. But the fact is that many models are not selling very well meaning that the numbers produced are a lot fewer than in the past. I wonder if some of todays models may tend to hold their values better in the future because of that. For instance, Sea Ray sold a lot of 260DAs but I doubt they have sold that many 270DAs (the replacement for the 260DA) in the past two model years. That means you won't find many for sale at any given point in time in the future. Because of that I tend to think that will mean these boats may have a better reseale value on the used market.

What do you think?

Dave
Click to expand...

I think people will read your post then get scared off of the 260 and 270 argument then conclude the only logical boat to buy is a 280. This will make the value of the 280’s go thru the roof!
That’s my story and I’m sticking to it…….well…..as long as I own a 280 at least.
 
And because the '06-'08 290DA's were fairly limited in production and clearly the best looking mid size cruiser out there I'm convinced my boat is an appreciating asset and I will have to plan on paying capital gains tax on it when I sell it. That's my story and I'm sticking to it! :grin:
 
OK, my first answer was really a joke.

Honestly, I “fear” hyper inflation is ahead of us. Not today or tomorrow but within the next 5 years.

The increasing national debit will cause a reduction in US currency value and this will result in inflation that will greatly exceed the inflation we saw in the late 70’s.

My prediction is we will see a inflation number of 25%............per……quarter.

Before long we will all be living in Million dollar houses…um, Gary will be living in a multi-million dollar house.
 
Presentation said:
I think people will read your post then get scared off of the 260 and 270 argument then conclude the only logical boat to buy is a 280. This will make the value of the 280’s go thru the roof!
That’s my story and I’m sticking to it…….well…..as long as I own a 280 at least.
Click to expand...

Cincy Aquaholic said:
And because the '06-'08 290DA's were fairly limited in production and clearly the best looking mid size cruiser out there I'm convinced my boat is an appreciating asset and I will have to plan on paying capital gains tax on it when I sell it. That's my story and I'm sticking to it! :grin:
Click to expand...


No vanity here? How does that term go about .."head in the clouds?' :smt043

I hope you two are correct..I mean I hope this market will apply for us all.
 
Mr Salt said:
I believe that as the overall market improves, from my lips to God's ears, that all used boats will increase in value, or atleast hold their value. There will be demand but no supply. We need the market to recover, however. I went through this with real estate in the late 80's, prices dropped when the tax law changed but they then came back when demand began to out pace supply.
Click to expand...

I agree -- I think used boats will increase or hold their value.

Is this logic flawed?

Let's say there is a new Sea Ray today with a list price of $50K and you buy it for $35k. Let's say that in 3 years that same model is listing brand new for $60K and demand has increased and the boat market is rebounding. You may be able to get that boat for $45k. Now, your 3 year old boat that you paid $35k is looking like a bargain. Yes?

Of course this is all on paper but I am optimistic :grin:.

.
 
I would like to think the original post has merit but I'm not buying it. Not for luxury items like boats. There are still plenty to go around and in fact it will take time for the downturn in the economy to stop its spiral downhill. Thus, there will be many more people who won't be in the market and thus I believe the market of used boats will always be saturated, thus supply will out pace demand. No one purchases a boat as an investment so the comps will always be going down to compete with the market unlike houses which, in a normal ecomony, should be going up with competition in the market.

Just my thoughts having had Econ 101 19 years ago. And of course, kidding about the 290's . . . kinda ;)
 
I don't think any one models availability is going to drive much value in the used market as the sample in the OP implies/questions. If your shopping for a used boat and you can get a 260 or a 270, I don't believe buyers will pay a premium on the 270. The fact that they can get the same boat in a 260 or 280 will drive the pricing on the 270. This should hold true for any model in the line up.

This downturn has hit the boating manufacturers and market so hard that I believe it will be many more years after the market rebounds for the number of boat owners in operation to get back to pre-crash numbers that the used market will be soft for up to 10 years. JMHO
 
Oh, and continuing on that thought, when dealers and manufactures have to deep discount for such a long period of time, the market is actually resetting the value of the item. eg: The discounted price IS the new price. So if this continues for much longer, new boats will need realign to the market. Of course vendors are always slow to accept this and remain overly optimistic that the market will drive back to their current value point, but in reality it won't, not for a long long time. Seen this in plenty of other markets.
 
Cincy Aquaholic said:
And because the '06-'08 290DA's were fairly limited in production and clearly the best looking mid size cruiser out there I'm convinced my boat is an appreciating asset and I will have to plan on paying capital gains tax on it when I sell it. That's my story and I'm sticking to it! :grin:
Click to expand...

Unless the Admiral gets it after she ties on your cement tennis shoes and bumps you overboard to see if you are wearing your PFD.........................:lol:
 
At least three factors come into play here....

1. Supply & Demand - We all know what's going on now, but what will it be like in 3 years?

2. Inflation - I think we all expect it to rise dramatically soon, with the Government borrowing more, and the value of the dollar dropping.

3. Depreciation - You take a bath on a new boat, but if you buy a good used boat smart, this could be negligible over the next 3 years.

The trick is to figure how these will play out.
 
Ok. . .let's test the appreciation theory a bit. How much would you pay for a 1985 30' cabin cruiser?

Let's test the hyperinflation theory a bit: How much would you pay for a 1972 30' cabin cruiser? How does that compare to the purchase price in 1972?

Boats may have value. . .but they are not financial investments. :)
 
comsnark said:
Boats may have value. . .but they are not financial investments. :)
Click to expand...

Ain't that the truth. In my opinion, the true value of a boat is the experience in owning one. Based on that, a 175 Sport could have more value than a 280 DA depending on the person/family.

.
 
Just a few of the other factors to consider in the future pricing of boats is any additional taxes put specifically on boats by various government entities, stringent regulation of boat emissions & discharges by the EPA, etc. If done in a heavy handed manner, they would be huge dis-incentives to own a boat.
 
ChuckW said:
Oh, and continuing on that thought, when dealers and manufactures have to deep discount for such a long period of time, the market is actually resetting the value of the item. eg: The discounted price IS the new price. So if this continues for much longer, new boats will need realign to the market. Of course vendors are always slow to accept this and remain overly optimistic that the market will drive back to their current value point, but in reality it won't, not for a long long time. Seen this in plenty of other markets.
Click to expand...

Agree 100%.

Doug
 
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