THE PRICING PROBLEM

Superyacht News talks to a Will Christie from Christie Yachts regarding issues around pricing brokerage yachts for sale.

In recent years the second-hand brokerage market has, unfortunately, been partially characterised by large assumed price reductions, long sales periods and fairy tale valuations designed to prey on the vanity of superyacht owners. However, with the balance of power shifting from the buyer to the seller, might the currently strong performing brokerage market have the opportunity to right some of the wrongs that were created in the post-2008 sales environment?

“We are seeing brokerage prices firming up and, probably for the first time since 2008, I would say that we are in a sellers’ market, and that is not something that I have said for 13 years,” starts Will Christie, founder of Christie Yachts. “In the decade pre-2008, buyers perceived the value of a brokerage yacht to be determined by three key considerations. What did the owner originally pay for the boat? What would it cost to build the same boat new today? And what have comparable boats sold for on the market recently? There was a balance between these three considerations that enabled the vested parties to reach a balanced conclusion on fair market value. The post-2008 environment, however, was completely different.”

“It became commonplace for buyers to come in with bids that were 20-25 per cent less than the market value, so it was necessary to build in a pricing buffer. This was largely a hangover from ‘the beauty parade’, where brokers would seduce new owners with fairy tale prices because they wanted to win the central agency at any cost,”