While boating is a year-round activity for enthusiasts and in many areas of Australia, the boating season is primarily considered as October through to say March. So the major interest in buying a boat can tend to be in the months leading up to the start of the season. So as we approach autumn, those considering buying a now may be wondering is it worth proceeding or should they wait? Timing can have an impact on achieving the best outcome both for the boat buying process and in securing the cheapest boat loan. Recent supply shortages and ongoing global issues may affect the availability of some boats for immediate delivery while fluctuations in interest rates can affect the cost of the boat loan.
We offer some food for thought around why it could be advantageous to secure your boat and your boat loan now or in the near future rather than waiting until later in the year or into next year.
Boat Stock Availability
Demand for boats shot up significantly due to the pandemic and this caused shortages for some makes and models. Buyers may look to prioritise availability rather than searching for the ideal vessel. Take a broader approach to boat selection with an open mind rather than focusing only on a particular make or model. If you’re wondering what a more expensive boat may cost in repayments, use our calculator to get rough estimates to compare.
Availability may also continue to be an issue due to the global computer chip shortage. The microprocessor shortage is still affecting production in many industries and has been tipped to continue for some time. While the hull and many other components that go into boat building would not be affected, the electronics could be. Grabbing what is available on the market right now could save buyers having to wait for delivery and possibly a higher price.
It was with great excitement that the announcement that boat shows were back on the agenda was recently made. But due no doubt to Omicron, that could change. The Discover Boating Melbourne event has been pushed back to April.
Exhibitors who had hoped to move stock at the show’s earlier date could be keen to get sell and open to dealing on price. Buyers that get in now could score a great deal on a new boat.
The second hand market may be stronger as ‘summer boaters’ seek to upgrade or sell now rather than store the boat during winter. There may be deals to be found from sellers eager to off-load their craft. But the demand for all boats has been exceptionally strong and that can drive up prices. As the supply situation eases and better meets demand, prices for second hand boats may ease.
For buyers that are planning to upgrade their current boat to a newer model, now might be good timing. A stronger price for the current boat may be achieved due to increased demand across the sector.
Boat Loan Interest Rates
Some of the most compelling reasons around timing your boat purchase are around the boat loan. With many boat buyers requiring finance to make the purchase, the boat loan forms an equally important part of the buying process.
Interest rates are key to achieving a cheaper boat loan and currently, lending rates across all markets are at historic lows as a result of the low cash rate. Many Australians may have been lulled into a false sense of complacency as this low interest rate situation has been steady now for over a year.
The RBA has long been saying it did not expect the conditions to be suitable for a rate rise until around 2024, and that could still be the case. But the recent rise in inflation figures and movement on other economic indicators has many analysts tipping a rate rise earlier. Some predicting as soon as August this year.
When the cash rate as set by the RBA increases, in general terms, so do lending rates. Lenders will have their own individual reactions to a rate rise based on their own requirements and exposure to different lending markets.
Banks and lenders that source their funding from overseas markets will be impacted by what is happening in global financial markets. Conditions which can vary from what is happening in Australia.
While a small percentage difference in boat loan interest rates may appear inconsequential on the surface, drilling deeper and calculating that seemingly small differential over the full term of the loan and the effect is more marked. For those intent on achieving the cheapest interest rate boat loan, acting quickly while rates are at these low rates could be an astute decision.
Jade Boat Loans will always adhere to our policy of offering better interest rates and our consultants will always strive to achieve the cheapest boat loans for our customers. But if the lending market responds to any RBA rate rise, our current rates will of course also change.
So there are just a few reasons and examples of why timing can be critical to getting a new boat at a great price and securing the cheapest boat loan. If these reasons resonate with you and you would like to get moving, speak with us about a pre-approved boat loan so you’re ready to seal a deal when you find the right boat.
Contact Jade Boat Loans on 1300 000 003 for a quote on a boat loan.
DISCLAIMER: THE INFORMATION AND SPECIFIC DETAILS CONTAINED IN THE CONTENT OF THIS ARTICLE HAVE BEEN PREPARED AND ARE PRESENTED PURELY AS GENERAL INFORMATION AND NOT INTENDED AS THE ONLY SOURCE OF FINANCIAL ADVICE FOR BOAT BUYERS AND LOAN BORROWERS. FOR THOSE THAT CONSIDER THEY REQUIRE SPECIFIC ADVICE, THEY SHOULD CONSULT WITH A FINANCIAL ADVISOR. LIABILITY IS NOT ACCEPTED IN REGARD TO ERRORS AND MIS-PRESENTED DATA AND DETAILS HEREIN.