Valuations
Methodology of Valuations
The true value of something is basically what someone is willing to pay for it. Therefore outside of selling the vessel, a logical process needs to be derived. Valuations are based on a willing buyer / willing seller which is self explanatory. Variance to this can be put down to 'special interests' which can be something such as the owner desperately needs to sell the vessel.
The valuation is a logical process combining the current and previous market for that make and model or similar vessels. The current market is attained through internet searches. The previous market is assessed using the soldboats database which is run by Yachtworld who the majority of broker subscribe to.
Why use a Marine Surveyor's Valuation?
A marine surveyor is well placed to assess the current market and importantly the condition of the vessel. On paper a vessel may have high value, but in reality, if in a poor condition it could be worth half this.
When required, numerous brokers, including the main dealer will be contacted to give an opinion and the surveyor will then take everything into account before providing the valuation.
It should always be remembered that valuations are subjective and the credibility of them is based on tangible data.
Who needs a Valuation
There are many reasons why a person or company may require a valuation. Insurance companies may require a value so it can be assessed whether the vessel is a constructive total loss (CTL). Finance companies needing a loan to value ratio.
Individuals may need a valuation in the case of divorce or if they are putting their boat up for sale.
Whoever requires the valuation, it should be done properly and based on a sound methodology and data for it to be viable.