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Brokerage sales drop 5 percent in August; average sales prices up

 Click to enlarge.

Click to enlarge.

U.S. brokerage boat sales were lower in August, compared with the same month last year, as 2,862 boats were sold for an aggregate price of $301.9 million.

Unit sales were off 5 percent and the total value of all sales was 1 percent lower, according to YachtWorld member brokerages reporting in their proprietary database, Power and sailboat sales showed volume declines of 5 and 6 percent, respectively.

The smaller decline in the total price paid was evidence that average sales prices rose during the month, especially for boats shorter than 46 feet. The increase was especially pronounced among boats 26 to 35 feet, which sold for an average price of $55,306, up from $51,072 a year earlier. For the market as a whole, the average sale price increased to $105,499 from $100,486.

The only sector of the market that reported increased sales was superyachts (boats over 80 feet long), where 22 boats changed hands, compared with 15 in August last year. In contrast to other size ranges, superyachts sold at substantially lower average prices, down from $4 million to $2.5 million. The sector is notoriously volatile because of the disparate ages and sizes of yachts in it and the average price fluctuates.

The other notable category was boats 46 to 55 feet, which had virtually flat sales and for the first time recently a slight increase in the average price, from $287,664 to $291,606. Looking more closely, we note that sales of higher-priced sailboats provided the bump-up and powerboat pricing was unchanged.

For the year through August, overall market volume was down 5 percent and the total value was down 7 percent, percentages that gradually have come together in recent months. Although slower mass-market sales have driven the lower volume, declines in pricing for superyachts have masked gains that the rest of the market has made in pricing.

In fact, after removing superyachts from the equation, the total value for the market would be up $28 million, or 1.5 percent, for the year, compared with 2013.

We typically benchmark the brokerage market’s performance against the previous year, but we thought it would be useful to take a longer view this month. We reviewed monthly unit sales over six years and saw that the first four months of this year exhibited relatively average sales performance.

However, from May to August, 2014 had the second-best sales record since the Great Recession, trailing only 2013. The bar chart above shows this in another way, with the red bars since April showing 2014 sales volume clearly above the 5-year average.

So is the U.S. brokerage market up or down? In the short term, it’s clearly lower, but as the year progresses it looks as if 2014 will come close to matching 2012, when 29,731 boats were sold for a total value of $3,3 billion. Volume may be slightly lower, but the average sales prices should be higher.

John Burnham is the editorial director of Dominion Marine Media.

This article originally appeared in the October 2014 issue.


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