The Boat Market Bubble is bursting...

[biffdotorg]

Ahh, folks buying over inflated used toys. They will all be upside down in the near future, and the banks don't want to be caught in the middle of it.

 

[HangOutdoors]

@djetok Great information. Over the last couple few weeks, I have prepared for what will be coming. I have moved my credit accounts around from banks like Chase, Wells Fargo, Bank of America to my credit unions with equal or great lines of credit or equal or greater credit card limits. Big banks are the first to start the crack down. Credit unions for the most part value the relationship and don't go down this path.

Better to be proactive and move while you can. When a bank typically closes your credit line or credit card, they will set the limit at what you owe which makes your utilization go up and your credit scores to fall. It then makes it harder to obtain new credit, for a lot of people.

 

[Toby]

My boat ended up going for $3k above the 2018 msrp two weeks ago. It ended up selling to a guy i used to work with. He called me from the place it was consigned when he found out it was mine. He felt better about paying the premium since he knows i take care of my stuff. He still was very aware of what he was paying, and what the msrp was. They want to be on the water now and we have options. Very long season here in Florida. February til November to be in the water, year round if you fish.

 

[tkeru408]

Wells Fargo is shutting down all personal line of credit accounts (cnbc.com)

KEY POINTS

• The bank is shutting down all existing personal lines of credit in coming weeks and no longer offers the product, according to customer letters reviewed by CNBC.
• The product, which typically gave users $3,000 to $100,000 in revolving credit lines, was pitched as a way to consolidate higher-interest credit card debt, pay for home renovations or avoid overdraft fees on linked checking accounts.
• With its latest move, Wells Fargo warned customers that the account closures “may have an impact on your credit score,” according to a frequently asked questions segment of the letter.

the credit crunch coming. The bubble may burst sooner rather than later.

Maybe, but I wouldn't use Wells Fargo as the bellwether for what big banks will be doing in the near future. They've been severely hampered since their fake account scandal and on multiple occasions have had to take conservative measures which have limited their gains relative to the other big banks. This could be a sign of things to come, or this could be just another case of Wells Fargo getting their proverbial lunch eaten by the other big boys.

 

[HangOutdoors]

Credit has been used to freely during the last year and a half. With Free money starting to be discontinued and other stop gap measures that where put in place to help people start to expire, it is going to get a bit nasty. Monetary compensation is at a high, while a lot choose not to work. Once realism sets in and people run back to jobs, it will drive the wages down a bit. The credit markets will constrict everywhere to protect themselves, which for those whom are fully extended credit wise or rely on lines, it will be detrimental. Just a matter of time.

 

[toddaltpeter]

Just saw an add on Facebook for $37,999 + Title, Tax and Destination and Rigging for a new 2021 SX190 from a dealer in WA. That's only $7,350 over MSRP. Just Insane.

Also, Chase stopped giving out Home Equity lines of credit as well. per there website:

Due to the current market conditions, we have suspended new HELOC applications and reallocated resources to support purchase and refinance transactions. This change protects both you and the bank, and allows us to better serve our customers.

The crash is coming..... And the way we are printing money, Inflation is coming with it. We just need an Oil Embargo and we can all break out our bell bottoms and re-live 1979.

 

[suke]

We want to move, but holding out a year to see what the market does. We don't want to try and buy in this market. Offering 50k+ on market value is just lighting money on fire, unless the value catches up. Even if we sell our house for a little less, hopefully we won't have to overpay for something different.

 

[ripler]

If someone offered me MSRP on my MasterCraft I'd really think about it. I paid 35K under MSRP for it and I just looked at the NADA price just for the hell of it and low retail is 5K more than the dealer sold it to me for. Crazy.

 

[mwalker4]

!q

Just saw an add on Facebook for $37,999 + Title, Tax and Destination and Rigging for a new 2021 SX190 from a dealer in WA. That's only $7,350 over MSRP. Just Insane.

Also, Chase stopped giving out Home Equity lines of credit as well. per there website:

Due to the current market conditions, we have suspended new HELOC applications and reallocated resources to support purchase and refinance transactions. This change protects both you and the bank, and allows us to better serve our customers.

The crash is coming..... And the way we are printing money, Inflation is coming with it. We just need an Oil Embargo and we can all break out our bell bottoms and re-live 1979.

Bell Bottoms would be the 73 oil embargo. Straight leg jeans or painters pants for the 79 crises. ? Loved those 70s.

 

[anmut]

!q
Bell Bottoms would be the 73 oil embargo. Straight leg jeans or painters pants for the 79 crises. ? Loved those 70s.

I'm only reliving the 70's if we can bring back / dig up the rock bands from that era. I'm done with "drooling mouth, stoner slow, auto tuned" music of today.

 

[2kwik4u]

We want to move, but holding out a year to see what the market does. We don't want to try and buy in this market. Offering 50k+ on market value is just lighting money on fire, unless the value catches up. Even if we sell our house for a little less, hopefully we won't have to overpay for something different.

Exactly the same here.

We want to move NOW, and have over $100k of equity in the house. However we have some debt remaining, and are worried if we buy into another house that is double the sell price of ours, by rolling our $100k equity over to it, we'll be at or near upside down if the market falls. Then we're "stuck" in a house that is expensive to own and maintain, with no equity and a big payment. If we stick it out where we are, we know what the house condition is in, we have a TINY payment, and it's not BAD, it's just not what we want anymore.

We have been considering doing a refi to access that current equity, and improve the house. Fight off the loss in equity with improvements. I doubt we'll lose $100k worth of value on a $300k home, but we might lose $50k in equity. Might as well access what we can now, and have a nicer house to "weather the storm" in, so to speak.

Final thought......being an adult is difficult. Making this level of decision that so closely affects your personal life is.....well.....damn hard.

 

[djetok]

Maybe, but I wouldn't use Wells Fargo as the bellwether for what big banks will be doing in the near future. They've been severely hampered since their fake account scandal and on multiple occasions have had to take conservative measures which have limited their gains relative to the other big banks. This could be a sign of things to come, or this could be just another case of Wells Fargo getting their proverbial lunch eaten by the other big boys.

Oh I hear you, I have other news that give me more insight as well. They are not the only ones, Citi is as well but not as drastic at this point.

 

[Chillypilot]

I can’t wait for the market to crash… time for me to get a new boat.

 

[Bluewater272]

I don't see the bubble bursting anytime soon for newer boats. Supply will increase at some point, but I don't think there's a long line of people willing to take a $20-30K haircut to get out from under a boat. The boat price trajectory has been bonkers for the better part of a decade in the offshore market, its just now catching up the recreational dayboat market.

I could probably have my boat sold by the weekend for five figures more than I paid for it. It's tempting, but I know that I couldn't go a year or two boatless, so I'd just end up overpaying on the next one.

 

[HangOutdoors]

Exactly the same here.

We want to move NOW, and have over $100k of equity in the house. However we have some debt remaining, and are worried if we buy into another house that is double the sell price of ours, by rolling our $100k equity over to it, we'll be at or near upside down if the market falls. Then we're "stuck" in a house that is expensive to own and maintain, with no equity and a big payment. If we stick it out where we are, we know what the house condition is in, we have a TINY payment, and it's not BAD, it's just not what we want anymore.

We have been considering doing a refi to access that current equity, and improve the house. Fight off the loss in equity with improvements. I doubt we'll lose $100k worth of value on a $300k home, but we might lose $50k in equity. Might as well access what we can now, and have a nicer house to "weather the storm" in, so to speak.

Final thought......being an adult is difficult. Making this level of decision that so closely affects your personal life is.....well.....damn hard.

It is hard to make the decisions, but it looks like you are deeply thinking it through rather than just quickly chasing your desires which could harm your family financially. The housing market will correct itself and it is going to be a decent size correction. That is inevitable.

We did the same thing, and I opened up a HELOC to do some remodeling but for also a possible future emergency, etc. At the current rates it is a smart move. BUT when you take out a HELOC you need to watch the fine print from which lending institution you use. Since the wrek in 2008 ish, lenders have gotten smarter about protecting themselves. Some will have a clause that "If lender determines market conditions have changed and the value of the house has decreased.... blah blah blah", they can decrease your HELOC credit limit to minimize their risk. Nice little catch. The credit union I went with doesn't do this, which is nice. Some of the banks do it and I have reviewed closing documents that have those clauses written in. Just something to be cognizant of. Remember a Bank appraisal or desk review of value could be totally different than what the value of your home actually is and/or what you can sell it for on the market. Internal reviews of value is for them to protect themselves and is usually very conservative in approach.

 

[bthessel]

Multiple people I know at the lake are trying to sell their boats right now thinking they are going to make big money, most of them are looking for 10-15k over what you would say they are worth. (2004 23ft SeaRay open bow for 35k???) Dealers here in Ohio seem to be starting to get inventory in from some of the brands. Prices are definitely going to start dropping. With kids sports back in full swing a lot of people aren’t getting the use out of their boats anymore.

 

[yam240sx]

hold on to your boats .. my bet is full lockdowns again and supply parts crunch .. no 2021s or 2022s .. of course needs before wants but ... try no new boats available !

 

[Mesa50]

hold on to your boats .. my bet is full lockdowns again and supply parts crunch .. no 2021s or 2022s .. of course needs before wants but ... try no new boats available !

Nobody in the south is going to comply with a lockdown again, or listen to Dr. Fallacy “Wearing a mask is more likely to harm you than help you. You need to wear a mask to protect others. You need to wear two masks. There’s no evidence that wearing a mask does any good. Closing the borders is a bad idea. Closing the borders is a good idea. 3 million will die. 60,000 will die. 300,000 have died. It wasn’t man made. It was man made. Children can’t spread it. Children can spread it. A vaccine won’t be ready in less than 24 months, and if it is it won’t be safe. Everyone needs to take the vaccine.” ……etc, etc, etc. How many of you would still have your jobs if you sounded like this? The only thing more inaccurate than Fauci, was Yamaha dealer delivery promises. But about half the population still believes the old “I’m from the government, and I’m here to help”.

 

[NewBoater]

I see people still paying top dollar for used boats until Yamaha catches back up on new production. And I don’t see that happening anytime soon. I also think lots of people know the newer boats are having lots of issues so that helps the older boats get an even higher premium as they want something reliable not something that’s gonna be sitting in the dealer waiting to get fixed after spending all that money on a new one.

 

[mwalker4]

Like the famous economist John Maynard Keynes said, “the markets can remain irrational longer than you can remain solvent.” So be cautious and flexible as market conditions evolve.