After looking up the blue book value of this boat it had been, up until a few minutes ago, one of the happiest days of your life. You had been looking for that perfect cruiser and you'd found it at a local dealership. It was a used boat, but it was in great shape and the price was right, too. In fact, the dealer had pulled out that used boat blue book to show you what a great deal you were getting.
Your 2-year-old Spitfire 28 Express had an average retail price, according to the "bible" of used boat dealers, of just over $32,000 but you had hammered the dealer down to $29,000. He'd offered financing but you were certain that your own bank could do a little better, so you'd signed the contract and promised to return later after arranging the financing. So now you are sitting in front of your banker, and he's pulled out his copy of the used boat blue book, "just to see what sort of money we're talking about," he'd said with a smile. As his finger traced the lines of tiny print, a frown crossed his brow and a sinking feeling suddenly appeared in the pit of your stomach. "Let's see — you said you paid how much ... $29,000?" he asks. Knowing that something is dreadfully wrong, you nod weakly. "Well, I have some bad news for you," he continues. "According to the blue book, your boat has an average retail value of $21,000 and we can't finance anything over 80 percent of that figure". Grabbing the book from his hand, you stare at the tiny column marked "AvRet." Sure enough, it says $21,000. How can this be? You saw a blue book at the dealership that showed $32,000 and now the bank blue book says just $21,000. Welcome to the world of the used boat price guide, better known as the blue book, where a degree in statistical analysis can be a useful tool. There are, as you just discovered, not only three different blue books but each has a different way of reaching a value for your boat. And, in fact, only two of them are blue. Just as in the automobile world, used boat dealers and bankers rely on these books to set their retail prices, to figure trade-in allowances, and to determine the amount of a boat that can be financed. Insurance agents use price guides to set the premiums and values for their clients, and marine surveyors rely on them for guidelines in their evaluations. You should also be aware that the Internal Revenue Service uses these price guides to see if you're spending more money than you appear to be earning. It doesn't take much to feel like you've been eaten by sharks when negotiating to buy or sell a boat, so let's take a look at the boating price guides. First of all, there are three generally accepted price guides in the U.S., each bearing a distinctive style and name.
The Three Blue Books
From BUC Research comes the BUC Used Price Guide, a tall, thin book in three editions: 1989-1996 models ($77), 1980-1988 models ($66), and 1905-1979 models ($55). You can buy the latest two volumes for $129, or all three for $169. From National Automobile Dealers Association (NADA), which also produces an array of used car price guides, is the Marine Appraisal Guide available by subscription for $100 a year, which includes three annual updates. It covers the years 1976 to 1998 for boats from 7 to 100 feet. Intertec Publishing (home of the Clymer engine repair books) offers several different ABOS Marine Blue Books including the Financial Edition ($85) that we reviewed which covers boats from 1984 to 1997. They also offer a Marine Blue Book with two updates ($149.95), but all of their books are strictly trade-only and not available to the boating public.
What They Provide
Each of the books has a distinctly different set of information, based on how they perceive the needs of their customers. The ABOS book, which covers boats between $3,000 and $200,000, lists both Wholesale Low and Wholesale High prices but only an Average Retail price, reflecting the needs of dealers who use the book heavily for trade-in negotiations. The BUC books, on the other hand, list both Retail Low and Retail High prices but no wholesale values , assuming that dealers are capable of figuring their own trade-in prices from the retail values that are of use to private parties, banks, and insurance companies. For 1998, the NADA guide expands the retail value range with Low, Average, and High prices while dropping the Average Trade-In (wholesale) value which had been included in previous books. ABOS is the only directory that lists the original manufacturer's suggested retail price, while the introduction to the BUC book comments on the absence by noting that the original MSRP bears no relationship to the value of a used boat.
How They Do It
If you thought that each used price guide simply kept track of all the sales of different types of boats, and then averaged the prices to get their listed values, you're sadly mistaken. In fact, none of the three books does it that way. In each case, they "massage" the numbers to some extent, based on either their own experience, a set of formulas that they have developed over the years, or the source of the values. Let's take a look at how each reaches the magic number for your boat. In business since 1961, BUC starts with hard market data, relying on a network of more than 4,000 boat dealers and yacht brokers nationwide. Twice a year, these dealers file two-page written reports (for which they are paid $18 per boat) on their boat sales, covering not just the description and condition of the boat, but a long list of accessory items as well. Taking those reports, BUC uses high speed computers to apply a series of formulas that modify the raw numbers, resulting in the listed values that appear in the BUC books. For example, the boats of one manufacturer may be known to have an initial drop in value after the first year and then a steady depreciation, while the boats of another manufacturer may hold their price the first year. The formulas for each manufacturer, combined with historical data, are then used to adjust the retail prices published in the previous price guide. Other variables that are factored into each listing include the engine type and size, fuel, and the current economic climate in general as well as the market for luxury items. Unlike the other price guides, BUC separates the sales reports into seven geographical areas of the U.S. and Canada to more accurately reflect the variances in prices in different locations. The result of the reports and formulas are Retail Low and Retail High price listings. Each retail value reflects a boat in "BUC Condition" (requiring no additional work and with average equipment) located in the northeastern part of the U.S. Using the BUC Area Adjustment Scale for a powerboat in the 19 to 29-foot range, you would add 15 percent for boats in the Pacific Northwest and 10 percent for boats in the California area. BUC includes boat specifications, which they gather directly from the manufacturer because, as BUC president Walter J. Sullivan III notes, "a surprising number of brochures from manufacturers contain incorrect data." BUC prices outboard boats without engines or trailer, and provides two separate price guides for that equipment that must be added to the retail low or high prices listed for the boat alone. Since 1985, BUC has operated the BUCNET, a worldwide computer database similar to a multiple listing service in the real estate world, and this information has also been used to continually refine the valuations listed in the BUC guides. Founded in 1949 to provide prices on outboard boats and remaining strictly a trade-only publication, the starting point for ABOS book price listings are reports from dealers and brokers which editor Tom Fournier estimates are "in the hundreds, mostly in Florida, the East and the Great Lakes." The ABOS staff also reviews newspaper classified advertising, the boats-for-sale section of Soundings, various marine multiple listing services, and the Internet. While these ads list only asking prices, ABOS factors down the prices by 10 to 15 percent to determine an estimated actual selling price. Another formula is used to reduce the asking prices to the estimated wholesale low and high prices that a dealer would use for trade-ins. Prices are set for mechanically sound, clean and saleable boats with no repairs necessary. Other variables used by ABOS to determine prices are the trends relating to the popularity of certain types or sizes of boat, taxes, inflation, interest rates, and the condition of the economy. In the ABOS books, most outboard boat prices do not include either the engine or trailer which are listed separately, although a few "package boats" are listed including the engine. The NADA Marine Appraisal Guide was first published in 1978 and, according to editor Steve Ferguson, relies on a sales reporting network of "300 to 400 dealers, marine surveyors and brokers." Those hard number reports are combined with research of various used boat advertising sources which, factored down from asking price, come up with the retail values. It is interesting to see how each book handles stern drive boat prices. ABOS and NADA, for example, list only a single model of each boat and then provide a chart that lists additional values depending on the horsepower increase of upgraded engines. BUC, on the other hand, goes to great lengths to list nearly all of the possible boat and motor combinations for each manufacturer along with the specific values of each boat. Each book also handles condition differently, with ABOS adjusting the boat values based on a percentage from a descriptive five-stage chart (Excellent to Rough). BUC combines condition and equipment into a single scale, adding 15 to 25 percent for a heavily loaded and perfectly maintained boat, and deducting up to 50 percent for a boat in poor condition or with no extras. NADA, with three value ranges, makes no mention of condition other than advising that overall condition must be taken into account.
The books also differ on their handling of optional equipment. NADA follows the automobile blue book style by listing nearly every possible item of optional equipment, broken down by year, and then provides a dollar figure to be added to the retail boat value. ABOS, on the other hand, notes that optional accessories originally costing less than $500 don't increase the value of a boat on the used market substantially. They do, however, provide a table to add up the original value of the options and then offer a schedule of values that should be added to the boat price. BUC, as mentioned before, combines condition and equipment together, leaving the question of how to price a perfectly maintained but poorly equipped boat, or a heavily equipped but cosmetically flawed boat. And that, in essence, sums up the world of marine price guides. Each book, at some point, makes it perfectly clear that the values listed are simply guidelines and that anyone — dealer, broker, insurance agent, buyer or seller — must use their own knowledge of the boating market to judge the value of each boat. As one broker commented when discussing the use of price guides, "Every seller thinks a boat is worth more than it really is, and every buyer thinks a boat is worth less than asked. That's the nature of the business." For anyone using these guides to buy or sell, the best advice is to do some market research in your own area for comparable boats, understand that the price guides don't necessarily agree in values, and be prepared to negotiate a satisfactory price on your own. Visit the boats.com Boat Buyer's Guide, to learn more about the ins and outs of buying a boat.
ABOS Marine Blue Book Intertec Publishing P.O. Box 12901 Overland Park, KS 66282-2901 BUC Used Boat Price Guide BUC Research 1314 N.E. 17th Ct. Ft. Lauderdale, FL 33305 (800) 327-6929 NADA Marine Appraisal Guide P.O. Box 7800 Costa Mesa, CA 92628 s(800) 966-6232 Editor's note: This article was updated in July of 2017.