Burgess Quarterly Sales Market Report (Q1 2013)

Market movement
Q1 of 2013 has seen 30 yachts new to market in the 40m+ sector, 77 price reductions and 21 yachts sold. The start of the year has been busy, with the majority of transactions occurring in the 40-50m sector.

The number of new yachts brought to market this quarter has increased notably on the last quarter of 2012, 30 versus 18. A notable new yacht to market is the 88.8m ILLUSION currently under construction in China. Although there is still a large disparity between new build and brokerage prices, as the inventory in the larger sizes starts to thin out, the more attractive these new builds will become.

There has been no real let up in the number of price reductions however the market is moving and yachts are selling, although at reduced prices. The busiest sector by far is the 40-50m with 15 sales out of the total of 21 for the quarter. Encouragingly, 5 yachts were sold in the 50-65m sector as opposed to just 8 coming on to the market. Again though, the number of yachts new to the market is still outpacing those being sold.

Motor yacht price reductions
Price reductions are still a major feature of the current market with 77 reductions being made this quarter, an increase of 25 over Q1 2012.

Although the 40-50m sector saw the most by number, this only equated to 17% of the sales fleet in this size range being discounted. The 50-65m sector also had 17% of the sales fleet reduced in price, the 65-85m sector of the market by comparison, saw 30% of the current sales fleet receiving a price reduction. Unusually, 2 yachts in the 85m+ sector were also reduced in price this quarter.

2013 looks like it will follow the pattern of 2012, with price reductions and the sellers willingness to negotiate on price being the key factors influencing the brokerage market. That said, as the number of quality yachts available starts to thin out in the 65m plus sector of the market, the prices here may start to harden slightly. Still, at present, yachts are selling at a considerable reduction from the asking price across the size ranges, with buyers firmly in control.

Sailing yachts
There continues to be an appetite for very large sailing yachts with four 80m+ under construction. Two notable 60m yachts have been added to the Burgess sales fleet and there appears to be a renewed interest in this sector of the market. The mid-range 40-50m sector still remains challenging although there are some fantastic deals to be had. Burgess sees the launch of the 43m Royal Huisman sloop BLUE PAPILLON from the sheds at the end of this month.

Q2 so far
In an update to Burgess' first quarter Market Report (download via the link below), April and May have seen a reasonable level of activity. For the first time this year the number of yachts sold (11) has out-paced the number coming to market (5).

In a relatively unusual event, the largest yacht sold this year, LONE RANGER, was sold at auction to a Burgess client. Other notable recent sales were the 68m Nobiskrug TRIPLE SEVEN, the 55m Heesen QUINTA ESSENTIA and the 47m Delta ROCHADE.

The start of 2013 has seen an uptick in the level of interest in new build enquiries and it has been encouraging to see clients looking to the shipyards for their future yachts.

Whilst there is still plenty of inventory on the market, there are definite signs of activity across the size ranges and Burgess continues to experience a busy second quarter.

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