Coach Appraisals

[travelite]

Anyone here in the need of a coach appraisal? I'm not. When I bought my coach I insured it at Agreed Value (AV) which is set at my purchase price. I've done this with all my motorhomes and have had these types of policies for as long as ten years. In the event that I would ever need the services of a professional appraiser, the good news is that there are many to choose from. Google "RV Motorhome Appraise" and you'll find lots of choices. The benefit of not singling one out and declaring it to be a Prevost appraisal expert is that if we don't like the answer we can simply move on to the next service. Keep going until you find the answer you like. We all know valuing these things based on comparable year, converter, feature set, along with a survey of current market asking prices is fraught with error. This approach can only deliver a wide range of possible values for a given coach. Certifying an official Prevost appraisal service seems to imply more credibility is given to this service over the existing ones in the market place. This is dangerous because they know no more than anyone else. If you're following the thread on another forum, you'll see that folks are very uncomfortable with the suggestions being made. Thoughts?

[dale farley]

While it is a fact that some appraisers are probably more knowledgeable about a particular brand than others, I feel pretty sure if you took the same RV of any kind to 10 different appraisers, you would probably get 10 different prices. There are so many variables involved, it would seem impossible to just go by year and overall condition to establish an accurate value for a used Prevost.

[travelite]

You're right on the mark Dale. Accurate appraisals is a difficult problem, even for folks who've spent a lifetime in the industry. What we own simply isn't a commodity. It comes as no surprise to anyone that we're not trading grain futures. Again, this is why having an assortment of valuation resources is important. I can go to an appraiser but I can temper that with a quote from DMRV, or Parliament Coach, or name your favorite industry stalwart. At least Liberty owners will know that they'll be well represented. BTW, if you have access to the forum there's a post or two on the topic which are especially keepers. At last, someone can say it like it is.

[Joe Camper]

Imho if u r financing any of it the appraisal is lopsided to protect the lender most times.

I think u may get a more accurate guess if it is a cash transaction.

[travelite]

True Joe, I always buy with cash and get an agreed value policy from the get-go and I keep it. Luckily it appears the idea has been shelved, underwhelming support. I'm still trying to figure out how much diesel fuel each appraisal is worth to make this worth their while.

[Gil_J]

There is little point in an appraisal for our coaches, especially older ones. As pointed out, they are not commodity products. There is also no effective way of gathering comparable sales data. Thete are few coach sales that occur each year and the actual sale price may be hard to find. Even with actual sale prices, the real condition and marketability of the sold coaches is unknown.

I will hang out on a limb here and suggest that for our coaches the factors that influence a real appraisal vary from appraiser to appraiser and even the weighting of these factors are inconsistent, if they exist at all.

Does the appraisal factor the service life of major subsystems and should it? Does the appraisal factor the serviceability of major subsystems? Is their a premium placed on one converter's product over another? Does the mauve colored interior with fabric covered couches take a hit over the neutral leather of another coach? What value, if any, do you place on service records? These aren't aircraft, so the value of service records isd another subjective factor. Ask the buyer that spent $65K after the sale how valuable service records were? Clearly, the number of meaningful appraisal factors are many, their individual impact on the appraisal purely subjective, and the time taken for a highly accurate appraisal cost prohibitive.

So, why would anyone get an appraisal? It would seem there are really only two reasons for an appraisal and neither driven by an owner or prospective owner. Many insurance companies require a periodic appraisals to establish the ongoing agreed value. Loan companies would be the other that sometimes require an appraisal to determine the maximum risk they are willing to take.

The idea that there could be a certified appraiser for our coaches would be a marketing certification more so than one that results in a meaningful appraisal. The test would be to have 3 or more certified appraisers arrive at an appraisal on a selection of coaches. If the variance in their appraisals on a given coach varies by more than some low percentage then there is a good chance the certification criteria or process has failed.

The only good appraisal is the one arrived at when a buyer and seller agree to a purchase price. That appraisal is unique to that transaction and may have no comparable value to a very similar coach.

[travelite]

Thanks for the voice of reason Gil.

For those who need an appraisal today, Steve Bennett of California Coach Company, LLC promptly offered his services which were summarily ignored.

'Automotive Appraisal Services' is certified with the National Association of Vehicle Appraisers and accepted by the IRS. They will produce appraisals for finance or agreed value insurance policies. They can work remotely using information supplied by you including photographs, Mark's number is (800) 495-2525 and he is located in Yorba Linda, CA. The cost is around $300.00. You'll get a very detailed 10 to 15 page report with comparisons.

I'd be willing to bet that all of the major Prevost dealer, brokers, and converters have appaisers they work with local to them and they'd be willing to recommend services to you. This is far from a needle in a haystack search. There's no need to make an unintended contribution to anyone's diesel fuel relief program.

[Gil_J]

I'd love to see their sample appraisal report. 10+ pages of information is a lot of information, unless it's full of pictures. I love that (not really) about home inspections where you often are provided a binder of information. Take the pictures out and you end up with a great 5 page document. Anyway, it looks like Automotive Appraisal Services is well established and has an impressive list of customers. Here's their web page, http://www.automotiveappraisals.com/appraisal-rv-motorhome.html

I wonder how many have had a professional appraisal done versus one done by a dealer? For those that have, did you find the appraisal on par with the asking price of similar coaches?

[travelite]

Thanks for the link Gil. Yes, Mike's got some very good information on his website. In the link you posted, http://www.automotiveappraisals.com/appraisal-rv-motorhome.html, he offers two appraisal types Phase_II for $175 and Phase_III for $225 (If one were to pay any more than this then one would know how much is being kicked back to the kitty). Phase_II is for a standard unmodified motorhome and Phase_III is for a substantially modified and customized motorhome. I urge everyone to read the FAQ, again tons of great info: http://www.automotiveappraisals.com/faq.html.

[travelite]

Well, after great fanfare, chest thumping, and self righteousness, the gods have proclaimed who the official Prevost Appraiser will be, and guess what? It's Mike from Automotive Appraisal Services. Ta da! :)

[Dick in Wisconsin]

What's wrong with identifying an appraiser whose knowledge of Prevost coaches has been vetted and established? I bought our coach from a private party for cash and it was insured based on the purchase price at a stated value. After spending a sizable amount of money to "zero everything out" and fix a few things that were not working on the coach I asked the insurance company to raise the value in our agreement (I also think the market had improved since we bought the coach). The insurance company balked and asked for "an appraisal". While the insurance company was knowledgeable about Prevost coaches, I was concerned about finding an appraiser whose first question would not be "is that a fifth wheel or bumper pull"?

Having been in the mortgage business since 1980 I clearly understand the challenges that face an appraiser when assigned to perform an appraisal on something as unique as Prevost coach. I think the efforts to find an appraiser knowledgeable about Prevost coaches and who is apparently accepted by the major insurance companies was well worth the time spent.

[travelite]

Nothing, it's a valid revenue stream and I guess it needed to be exploited. I would just caution that folks be careful not to pay more than they should or need to. It wasn't hard to flush out a couple of qualified appraisers, and I'm certain there are many others who haven't been mentioned. The other group likes to cultivate their revenue streams and my experience shows that these streams are what matters most, above all else. You know where to find me to discuss it further.

[rickdesilva]

Let me add a side of this that I think we're missing. Appraisals are used for insurance, personal and sometimes lending purposes. The one part that is omitted is that not everyone has the luxury of paying cash for their coach. Regular banks are reluctant to lend any money on Prevost conversions because of the cost and unknown exposure. Fortunately we have lending sources that will accommodate us when the need arises. However a guide like the NADA guide which can accumulate national transaction prices sets the values on what has actually transpired in the market. I'll use the NADA guide because I know a little about how it operates. Now the problem is, and that is why a guide like the NADA RV guide does a lousy job is because they do not have enough info accumulated from the various sales outlets to create an average transaction price. In addition the difference in the quality and cost of the conversion is hard to pin down. NADA for example creates a data base by polling the national retailers. In addition, they have a process where the retailers can voluntarily submit their sales data on a regular basis. I would suspect that the info submitted could be make, model (XL ll or H3), year, converter. From that point you can have add on's like Slides, Over the road air etc. And like any other guide, its an estimate! and the buyer has to figure in all the variables but it does report the actual average transaction price. If a nationally known price guide can gather actual transaction prices and make those available to banking sources it may open up the door for more banks to have the appetite to lend money for Prevost Conversions.

[travelite]

Thanks Rick,

It is an issue with other brands too. Wanderlodge and Airstream have a terrible time with NADA values. We have half the wanderlodge population happy with NADA's overestimate and half unhappy with NADA's dramatic underestimates of motorhome market values. (Newer coaches tend to be overestimated while older coaches underestimated, which is understandable). The folks who suffer thru NADA's underestimate would like to have NADA completely remove wanderlodge from their RV Guide, but NADA will have nothing of it, and there's no consensus in the wanderlodge community to have it removed. Our only hope is to have dealers and brokers funnel real world transaction prices to NADA but they refuse, probably because knowing market values and keeping them private gives them a competitive edge. On top of this is NADA's issue with estimating motorhomes which have been thoroughly updated or customized. They completely fail here and won't accept data for motorhomes sales when the motorhome has significantly diverged from its stock oem form. So half our folks rely on independent appraisers to help with loans. So, it's definitely important to have a set of appraisers handy who can competently appraise our motorhomes, it's just that I don't think it requires a corporate effort and a press release and all of what that entails.

[Gil_J]

Rick,

Given the limited number of annual sales and the likelihood NADA hasn't (can't) capture available options, I'm surprised they would put their integrity on the line to publish data with limited value, although is seems some Wanderlodge owners believe they have done just that. I just looked at NADA's Online RV guide. No Marathons, no Parliaments, no Country Coaches, and only 89 and 90 40-foot Liberties.

With the market for coaches subject to wide fluctuations I can't imagine data that's even a year old being meaningful. I would expect the XL-II delamination issue to kill the resale market and likely result in too much risk for a lender. On the flip side, the X-3 is simply not a viable replacement in many cases. Therefore, the XL-II values could increase. With the current prices of Series 60 powered XL coaches where they are the bottom has fallen out of the 8V92 market. It's these big swings in value that put lenders at the most risk. Just look what happened with the much more stable housing market.

I think the yachting (large boat) world has figured this out. They have certified surveyors that perform an in depth inspection of the boat and its major systems. With the results of their survey, sales data, and current listings they establish fair market value. This isn't cheap and is typically only performed when there is sales contract, much like a home survey (but much more thorough). I think the survey on my 50-footer was nearly a grand. Of course, that is paid by the buyer.

The older the coach the more likelihood the book value is of little value. Some older coaches look like they are much newer coaches in condition. I know of a 99 Country Coach (not mine) that looks newer in condition than many 2005+ coaches. If they settled for the going "book" value it would sell before all others. But, how much money did the seller leave on the table? How about upgrades and routine maintenance items? It would be easy to determine the added value of new tires or batteries, but what value would be tied to an interior upgrade? The range of changes in an interior upgrade can be broad, making for a difficult formula in determining added value. The best option for a lender is to force the buyer to put more skin in the game on an older coach to reduce their risk.

In the Prevost conversion industry, it's hard for me to believe a group of 3 appraisals on the same 5+ year old coach would result in a fair market value that was any closer than 15% from highest to lowest appraisals. I believe that range would expand well beyond 15% with older coaches.

[travelite]

Gil,

It's even more mind-boggling when you consider that these appraisers will do the appraisal remotely with information given to them by you including:

"6 to 8 photos of the exterior, covering all sides
10 or more photos of the interior
2 or more of the engine and engine bay
At least one of the odometer
One of the VIN"

Of course the most important piece of information you can give to the appraiser is also listed:

"Never fail to tell the appraiser what you think the coach is worth."

Gleaned from the public corporate press release. So, I think a picture is emerging on how this works.

[rickdesilva]

A little more info and clarification. I used NADA as an example because I have on a few occasions in the past worked with them because a lack of credible information to create accurate pricing on specific brands. Since they are a "price guide" I think their information is more "averaged" than vehicle specific whereas the appraiser is more vehicle specific. NADA price guide has recently changed ownership as my understanding is the National Auto Dealers Association recently sold off the price guide so I don't know if the new owners have changed the protocol. But if things are the same, there is a reporting form that every licensed retailer can submit for their transactions, for example if Marathon, Liberty, Millennium as well as other licensed brokers dealers etc submitted the transaction prices of their pre-owned on a monthly basis, a data base could be created of ACTUAL transaction prices. No doubt that the various accessories, options create a unique problem for coaches. But it takes a concerted effort to make it work. As far as Bluebird, I am very well aware of the pricing situation as I only had 2 of them until I ventured into the Prevost category. Just my 2 cents, I just thought I would throw the info out there for digestion.

[travelite]

And, probably half or more of the Prevost's sold are private sales which is another block of sales NADA will not accept. The big converters like to serve as clearinghouses for their lightly used older coaches. They want to be the goto folks when people have questions about what their coach is worth, or what asking price they should list. This is an opportunity for the converter to establish a relationship, influence the next buying decision, and possibly consign the coach. It makes financial sense for them to keep their database of real world transactions private and not share it with NADA. If these brokers/dealers aren't willing to submit a reporting form I think NADA reverts to a simple formula based depreciation scheme to gauge value, and we all know where that leads.

(What's missing from the Corporate Press Release is a statement of NFI).

[rickdesilva]

David,
Last post by me. First off, I only used NADA as an example because I'm not shooting from the hip, I know how it works. I don't think you understand the process, there is no financial reason for ANY entity within the purchase stream to withhold any information from a price guide like NADA. What you are describing is exactly why there is no accurate database regarding transaction prices. Any vehicle retailer/manufacturer understands the importance of this and if he wants to solidify good info for lending sources and end user customers, he will participate, that's how they build franchise value and help move their inventory. Lack of credible information only opens the door for incorrect speculation. Big converters know that if they serve as clearinghouses for their older coaches and report the accurate, higher transaction prices they basically "control" the marketplace for pre-owned pricing.........just like the certified preowned programs in the automobile world. Maybe we're talking about the same thing, I'm a little confused about the Corporate reference. Anyway, I appreciate the discourse, always great to see what other folks are thinking. Travel safe!

[travelite]

I appreciate the discourse too Rick and I learned something today. Thanks. With many thousands of dealers and many thousands of cars there's an efficient marketplace where prices settle down; no one wants to be left out of a deal and they cooperate. In a market that's not so efficient arbitrage situations occur and I guess that's what I'm alluding to. Brokers and dealers in the wanderlodge community, for example, prefer to keep their data to themselves and they don't cooperate; it's anyone's guess as to why but I have my theories. It's a bit of a prisoner's dilemma, because they don't cooperate the overall market suffers. This is likely not my last post on the topic. :) Safe travels.

(BTW, the 'corporate' reference refers to the other site and the 'press release' to their published articles but I'll drop that shortly).