Unit sales in the U.S. brokerage market in July dropped 8 percent from the same month a year earlier, to 3,287 boats, continuing a modest downward trend that has been in place all year.
Sales have remained above their monthly five-year averages since March, but they have consistently lagged the sales volume of the previous year, according to YachtWorld member brokers reporting in their proprietary database, Soldboats.com.
For the first seven months of the year, the number of boats sold fell 5 percent, to 19,122; that’s about 900 fewer than were sold in the same period in 2013.
At the same time, two pricing trends we reported in previous months have continued. First, among brokerage boats below 45 feet, values rose during the first seven months even as sales stayed flat or declined.
Among boats shorter than 26 feet, even as the number sold decreased by 7 percent, the average price has climbed 5 percent, from $21,730 to $22,830. Among boats 26 to 35 feet, sales were down 8 percent, but the average price paid rose from $55,032 to $58,218, or 6 percent. And for boats 36 to 45 feet, sales were off by 1 percent, but the average sale price increased by 3 percent, from $130,260 to $134,241.
The second trend is that although the volume of sales has increased among larger boats, the average price paid has decreased. Sales rose by 6 percent among boats 46 to 55 feet and by 7 percent among boats 56 to 79 feet, but values have not kept pace. The average price paid in those two size segments declined by 3 percent and 1 percent, respectively.
On July 31 we took a snapshot of the 127,690 boats listed by yacht brokerages for sale on YachtWorld. As the bar chart indicates, the age of these boats covers a span of more than 40 years and the majority are less than 15 years old. What is most distinctive, however, is the significant dips in inventory during the recent recession, as well as that of the early ’90s. The bulk of the boats on the market are 6 to 15 years old.
There’s also considerable variation among boats of different sizes on YachtWorld. Among recent-model boats, those under 26 feet stand out, particularly very recent models. Yet in the 6- to 15-year range, boats 26 to 35 feet and 36 to 45 feet are much more common and the smaller boats are less significant. Among larger yachts the large number of boats for sale that were built between 1998 and 2007 is as remarkable as the small number built in the last five years.
Our main observation about these data is that although recent-model small boats are relatively plentiful on YachtWorld, larger models are not. One might think this would drive small-boat prices lower and larger-boat prices higher, but the reverse appears to be happening.
Perhaps this is because as the new-boat market has gained strength in the last few years, the additional recent-model boats built are fetching increased average prices. By contrast, the lack of recent large-model inventory — and the aging of most of the larger yachts now for sale — is driving average prices lower.
John Burnham is the editorial director of Dominion Marine Media.
This article originally appeared in the September 2014 issue.