Drastic reduction in secondhand boat prices ?

[JumbleDuck]

The best advice I was given & i tell you about it too : friends of my parents advicedd me "Calculate the cost per day if you want, but never, ever, ever calculate the cost per mile." Amazing!!

What a curious coincidence, new boy. I quoted that comment from friends of my parents. Odd coincidence.

 

[Twister_Ken]

What a curious coincidence, new boy. I quoted that comment from friends of my parents. Odd coincidence.

Heavens, it's your long-lost twin.

 

[Otter]

Now that the property market is on an upward trajectory and the economy is clearly improving it would be interesting to hear how boat prices are moving? Clearly we're first into a recession, last out maybe?

 

[sailorman]

Now that the property market is on an upward trajectory and the economy is clearly improving it would be interesting to hear how boat prices are moving? Clearly we're first into a recession, last out maybe?

first in a slump are Architects then builders & normally the last out too

 

[bedouin]

Now that the property market is on an upward trajectory and the economy is clearly improving it would be interesting to hear how boat prices are moving? Clearly we're first into a recession, last out maybe?

I have a suspicion that the second hand boat market may be in the doldrums for a long time.

The costs of owning a boat are so high that the capital cost don't dominate the equation, if you can afford say £6k a year to run the boat you can probably afford £75-£100k to buy it, so there is always likely to be weak demand for boats below a certain price point. That is coupled with the fact that very few boats seem to be scrapped or otherwise removed, so we have increasing supply and decreasing demand.

I think there may be a bounce at the bottom end of the market - say in the 25-35 foot sailing boats where people are attracted by lower running costs and where there is a comparative shortage of supply (as not so many new boats have been built recently).

I also have a suspicion that the boom in the UK was partly caused by "baby boomers" who have become rich on the back of rising house prices and the next generation will not be as well off. As the baby boomers move out of boating it is not clear who will be buying their boats.

 

[Grumpybear]

I have a suspicion that the second hand boat market may be in the doldrums for a long time.

The costs of owning a boat are so high that the capital cost don't dominate the equation, if you can afford say £6k a year to run the boat you can probably afford £75-£100k to buy it, so there is always likely to be weak demand for boats below a certain price point. That is coupled with the fact that very few boats seem to be scrapped or otherwise removed, so we have increasing supply and decreasing demand.

I think there may be a bounce at the bottom end of the market - say in the 25-35 foot sailing boats where people are attracted by lower running costs and where there is a comparative shortage of supply (as not so many new boats have been built recently).

I also have a suspicion that the boom in the UK was partly caused by "baby boomers" who have become rich on the back of rising house prices and the next generation will not be as well off. As the baby boomers move out of boating it is not clear who will be buying their boats.

And many baby boomers used the equity in their houses to fund their boats.

 

[Tranona]

And many baby boomers used the equity in their houses to fund their boats.

But now they will be able to raid their pension funds!

 

[bedouin]

But now they will be able to raid their pension funds!

The baby boomers with their gold-plated final salary pensions, could afford to take equity from their house in their 50s say an buy a boat. Our generation who have to survive on defined contribution schemes have to be much more careful with capital. Coupled with people having to work longer before they can afford to retire I really don't see much of the pension capital being spent on new boats.

 

[doris]

The baby boomers with their gold-plated final salary pensions, could afford to take equity from their house in their 50s say an buy a boat. Our generation who have to survive on defined contribution schemes have to be much more careful with capital. Coupled with people having to work longer before they can afford to retire I really don't see much of the pension capital being spent on new boats.

What a tragic indictment on the current 30/40 years old generations. Do so few of them really have the ability to generate wealth. If that is the case then the New World is deffo in the driving seat. Personally I have greater faith in the generations following me, it's the idiot politicos that are cocking it up.

 

[bedouin]

What a tragic indictment on the current 30/40 years old generations. Do so few of them really have the ability to generate wealth. If that is the case then the New World is deffo in the driving seat. Personally I have greater faith in the generations following me, it's the idiot politicos that are cocking it up.

It is not meant to be a comment on the 30/40s - I think as a rule they work harder than the previous generation for less reward. But the world has moved on.

Over the years property has dominated personal finances more and more - the baby boomers gained massively from the increase in property values and that can't happen twice. They also have gained from very generous pension policies - many of which are largely unfunded. So this generation is both having to pay for their parents' pensions and their own.

Then the balance of the world economy has made the lower end of the employment market much more competitive.

The baby boomers certainly had it much harder in the working years, standards of living were much lower then, a sort of enforced austerity that resulted in a frugal culture in that generation that seems largely lost on the following generations.

But how many people now in say their early thirties will retire on 2/3rds final salary (index linked) in a house worth £500K+?

 

[Tranona]

The baby boomers with their gold-plated final salary pensions, could afford to take equity from their house in their 50s say an buy a boat. Our generation who have to survive on defined contribution schemes have to be much more careful with capital. Coupled with people having to work longer before they can afford to retire I really don't see much of the pension capital being spent on new boats.

Was slightly tongue in cheek, reflecting the stories in the press that people will use their new found freedom over their pension funds to splurge it all on a new Lamborghini. Must be true as it is the subject of the Matt cartoon in the Torygraph this morning.

Seriously, though, the new rules will give people much more freedom and you can be sure that some will use it to buy expensive assets such as boats. Whether it will be enough to have any significant impact on prices is another matter. Much bigger fear is pressure on property prices as suspect many people will seek to convert their pension funds into property assets such as buy to let. could be a good thing if it resulted in sub standard or under utilised property being upgraded or brought back into use.

 

[bedouin]

Was slightly tongue in cheek, reflecting the stories in the press that people will use their new found freedom over their pension funds to splurge it all on a new Lamborghini. Must be true as it is the subject of the Matt cartoon in the Torygraph this morning.

Seriously, though, the new rules will give people much more freedom and you can be sure that some will use it to buy expensive assets such as boats. Whether it will be enough to have any significant impact on prices is another matter. Much bigger fear is pressure on property prices as suspect many people will seek to convert their pension funds into property assets such as buy to let. could be a good thing if it resulted in sub standard or under utilised property being upgraded or brought back into use.

I think the idea of people buying expensive assets are over-hyped. Firstly it you are the sort of prudent person who as saved all your life to get a pension pot big enough to buy a Lambo, then you are not the sort of person who is going to splash out on one.

More importantly the tax rules are such that people should not be taking large lump sums - why put money into a pension at all if you are going to be paying 40% tax on it when you take it out.

There may be some impact on the property market - but perhaps not that much. Many people are already investing in property as an alternative to putting the money in a pension so it is also possible that people may choose to put less into property before retirement on the grounds that pensions make more sense now. TBH I am not sure what proportion of the population has the sort of pension pot that is large enough to buy a property to rent - I imagine it is a very small percentage.

 

[Tranona]

Nobody really knows what is going to happen. There will undoubtedly be a rash of investment schemes to replace the annuity as insurance companies try to recover some of the potential loss of business.

One of the attractions of pensions is that (for many) the tax relief on contributions is at 40%, but the benefits are only taxed at basic rate when income falls on retirement. Nothing now to stop people re-arranging their pension income stream into property based investments and some will see this as beneficial, even if they have to pay tax on withdrawal of their funds.

As to buying property to rent, you can still buy properties in some parts of the country for relatively low prices and achieve rental yields of 6-8% and some might see this as more attractive than annuities or structured financial investments.

Time will tell.

 

[PhillM]

Nobody really knows what is going to happen. There will undoubtedly be a rash of investment schemes to replace the annuity as insurance companies try to recover some of the potential loss of business..

I wonder just how badly the insurance companies actually feel about the change?

They can now market products that look better than annuity product but have the advantage (to the insurance company) of not having to pay out for life of the buyer. Watch this space for a crop of hyped "freedom" products that actually cost more in fees and deliver less to the buyer. I have never known an insurance / pension company lose out on new regulation.

Perhaps I'm just cynical.