Onboard with BOATSHED

When Covid-restrictions lifted in 2022, brokers reported a high demand for boats. Potential buyers were keen to enjoy their leisure time again, putting pressure on demand and pricing across the industry as a whole, meaning sellers were more likely to achieve their asking price.

Fast forward a year and financial pressures coupled with general market uncertainty have ended the boom, widening negotiating margins (the di erence between the original asking and final sale price).

Negotiating margins

Data from the past 15 - 20 years shows the negotiating margin was around 27 per cent; a result of price reductions and survey adjustments etc... Post-Covid, the negotiating margin shrunk to around 12 per cent, reflecting the high level of demand as people were prepared to pay higher prices for boats. At Boatshed, Q2 2022 sales were 30 per cent higher than the same period this year.

This growing negotiating margin creates a number of problems; some people are sure, when selling their boats, that prices are still strong (despite a drop o in demand), making them less willing to o er price reductions, leading to a disparity between sellers and buyers.

Accruing expenses

With owners less keen to lower prices, boats are on sale for longer, incurring expenses that could easily be avoided. The average time it takes to sell a boat, according to Yacht World and industry data, is around 320 days.

Boatshed has a shorter selling period - on average 110 days - confirming that despite pricing pressures, there is still demand for boats at the right price. When demand peaked last year, our selling timescale for many boats was three months.

To clarify what expenses are being accrued, Boatshed has a cost calculator, telling owners how much their unsold boat is costing them (daily, weekly or monthly), while moored or on a dry stack.

Take a client who has had a boat for sale for three months, priced at just over £60,000 and already reduced in price by 22 per cent. After inputting the cost variables, such as the boat’s initial value, size, age, location (whether in a marina, dry stack or swinging mooring), insurance and maintenance regime (DIY or via a third-party), into the calculator, it estimates the cost of three months of ownership. In this case it is just over £4,300, so around £1,200 a month or £41.76 for every day the boat remains unsold.

Tools like this are important because they highlight the expenses that accrue when an owner rejects the idea of a price reduction or lower o er, even though it could potentially save money.

An investment

Our advice to owners nervous about selling their boat: View the boat as an asset. It is an investment, so why not advertise it speculatively, all the time? We remove the name and identity of boats when advertising them, and if we find a customer o ering a price the owner’s interested in, then a decision can be made to sell or not. And with a data set of people viewing particular models of boats, similar to what is advertised, there is a ready-made potential customer base to connect to. Do not be afraid to take that leap, take ongoing expenses into account and be realistic about pricing.

For an initial discussion call us on 020 7654 7034 or email learning@ms-sc.org