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Sales are stronger, but they’re taking longer - Trade Only Today

Sales are stronger, but they’re taking longer

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Brokerage sales in September improved by 10 percent from the same month in 2008, with 2,428 boats changing hands in the United States, according to data reported by YachtWorld.com member brokers in the Web site's SoldBoats.com database. However, the total value of those boats was 11 percent less than the value of the 2,205 boats sold the previous September. Additionally, as has been the case since last spring, the average time it's taken to sell a brokerage boat is getting longer, not shorter, with boats sold in September having been on the market for an average of 293 days, up from 260 a year ago.

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Inventory is moving, however, and for the fourth month in a row, unit sales outpaced the same month in 2008. For the first time, sales equaled the five-year average number of boats sold in September.

Another positive shift in the market in September was the rally in sailboat sales, which compared to 2008 have been consistently lagging behind powerboat sales. Nearly 5 percent more sailboats were sold in September than September 2008, although year-to-date only 4,047 sailboats have changed hands compared to 5,263 in 2008. By comparison, based on September's improvement, powerboat sales for the year drew nearly even with the first nine months of 2008, with 17,422 boats sold.

Except among boats more than 55 feet in length, all sizes of boats showed better September sales compared to the same month in 2008. Where the smallest boats have sold best so far this year, in September, sales picked up 22.8 percent in 36- to 45-footers and 17.5 percent in 46- to 55-footers. The total valuation of boats sold was higher in all size categories except the two largest - boats 46 to 55 feet were down 12.7 percent in value, and boats above 55 feet were down 40 percent.

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This month, we looked at how long boats have been on the market before selling, compared to previous years. In simple terms, smaller boats sell faster than larger boats, but in all size ranges the time has increased. The exception is that boats larger than 55 feet have remained about the same at a little more than 410 days.

In broad market terms, time-to-sale has averaged 250 days in recent years. In 2007, the average came in slightly lower and, in 2008, it was often above 250, but never for long. This year, since April, the average has moved into the 270-day range and in September shot up to 293, the longest average time-to-sale in the last three years. Whether that's a one-month aberration or new territory for the market remains to be seen.

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This article originally appeared in the November 2009 issue.

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