Observation of the Caravan Market

Markets can be pretty subtle Jim.

I note the lower end of housing hasn't dropped much.
Seems to me that when times get tough, but not a total disaster, that people move to a cheaper option rather than get out.

I.E. Expensive Cruise, plane trips and RV's take the big hit and people move into travelling more locally in lower cost options.

So I would expect the smaller van market to stay stable.

Hi Jim

We went to a Caravan / Camping Show on the Gold Coast recently, and found quality vans are still holding their value, in fact some are increasing in price, there are bargains around if you are prepared to haggle.

Cheers
Daza

One thing I've noticed, is that in the private ads, people are looking to get what they think the van is worth, which is often over the top, particularly in the current climate.

We got a used (once) 4 month old 19 ft Jayco Discovery Outback with shower and toilet for $28000 from a dealer because they said "who is going to buy this at $2000 less than a new one when they've got all the options to choose from in a new one". Ours doesn't have air con, which is standard in these models although the fittings are all there if we want to add it. What's more, it was kitted out with two batteries and inverter. As you said Jim, the dealers keep getting the stock rolling in and they've got to let some go. We even sold our own on the trading post for a very reasonable price just to get this one - and it went quickly.

Markets are driven to a large degree by sentiment. I remember our Economics teacher saying once “that if enough people believe a certain economic event or activity will take place then eventually it will” . When all the media and Government officials keep telling us there are hard times ahead and maybe a recession – well it is self fulling. When there is economic uncertainty a first reaction is to postpone non essential purchases or choose to purchase the same good in a lower price category. It doesn’t mean that buyers do not necessarily have the money but they choose to withhold a purchase at this time. Thus there will not be a turnaround in sales of non essential capital goods until there is a change to a positive economic sentiment. In the meantime businesses must make sales as best they can.
For example in Saturdays Courier mail there was a full page advertisement for Brisbane Winnebago with all 2008 plated vehicles discounted by a minimum of 10% The range topping 40 footer was reduced a massive $150,000 ( to only $465,990).
On the TV news last night was a story about vehicle repossessions – one auction house used to get about 15 repos a week – now there getting 15 a day. And that’s just one Auction in one city.
But eventually there will be a turnaround and in the meantime there will be bargains available for the astute buyer.
Cheers
GPM

Jim, I recall reading that the asking price for used cars was lower at dealers than private sellers in January. On the basis that dealers were realistic and private sellers had yet to come to terms with the reduced market. I think you are seeing the same effect. You are right, when the vans are still sitting there in 6 months and 30 has gone to 50 which has gone to 80 then prices must drop.

Dealers will be under more pressure than private sellers so new might even become cheaper than used. It's coming like a Tsunami IMHO.

Don't buy any non essential product for 6 months would be my advice. You might over pay by 30 - 50 %

We have just ordered a Jayco Swan Outback CT, the wait for delivery of these is June 09. Appears that this particular model is extremely popular. By the time you add things in and pay for the Outback options there is not alot of change out of 28k, this includes full annex.