A look at Canada shows our northern neighbor selling boats at a much higher valuation than 2009
After a few months of losing ground compared to 2009 sales, by some measures U.S. yacht brokerages in October reported improving sales.
As entered in their proprietary database, SoldBoats.com, member brokerages of YachtWorld.com indicated that unit sales were down only 1.5 percent against October 2009, after being 7 percent lower in a month-over-month comparison in September. Looking at the five-year average of October sales (2,263 boats), sales were down slightly at 2,126.
The total valuation of sales in October dropped substantially, however, from $219 million to $198 million, an even bigger slide than recorded in September, which was off 6 percent against September 2009 sales. A slowdown in big-boat sales made the difference in values, as boats over 55 feet sold for about $15 million less in October than a year ago, and those 46 to 55 feet sold for almost $8 million less.
Year to date, with 25,970 boats sold, U.S. brokerage market sales are up 10 percent over the first 10 months of 2009. Both powerboats and sailboats have contributed, with sailboats up 464 boats to 4,891 (8 percent) and powerboats up a little more than 2,000 boats (more than 10 percent). Despite the drop in valuation in October, for the year, sales have totaled close to $2.6 billion, a gain of about $320 million, almost 15 percent.
Compared to their colleagues in the U.S. market, yacht brokers in Canada have had a different kind of year. The market is much smaller than the United States as a whole, and reporting rates to SoldBoats.com may not be quite as high. Nonetheless, year-over-year comparisons of the data reveal significant differences. Brokers in Canada report that unit sales have been almost exactly on par with the previous year at about 1,500 boats, yet dramatically higher in terms of total valuation, increasing from $115 million in 2009 to $201 million in 2010.
A review of the year-to-date sales among different length boats reveals a couple of the reasons for the higher valuation. While the same number of boats have sold each year in Canada, fewer boats under 35 feet have been sold in 2010 and the middle size ranges showed relatively small increases. However, among boats over 55 feet, unit sales increased from 13 boats in 2009 to 34 in 2010 - an increase of 162 percent. Apparently some of the big boats sold were very large, because valuation increased from $12 million to $89 million.
Another possible contributing factor relates to the high percentage of sailboats sold in Canada - on the order of 30 to 40 percent compared to about 20 percent in the U.S. Compared to powerboats, there are relatively fewer sailboats in the larger size ranges tracked within SoldBoats.com (boats 45 to 55 feet and boats greater than 55 feet), and so far this year, sailboat sales overall have dropped from 620 boats to 525. At the same time, sales of powerboats have increased from 884 to 984.
This article originally appeared in the December 2010 issue.