I found a 2016 backhoe for sale with only 70hrs on the clock. It is basically a brand new machine that is 3 years old with no Warranty. Is there any kind or rule of thumb on how much a machine would depreciate based on age alone? The owner still owes money on it if that changes anything.
I bought basically the same backhoe in the fall in 2017. It’s a 2018 and cost around 135,000 Canadian.
You can figure a minimum of fifteen percent depreciation the first model year and ten percent each year after that till its five years old. That's general rule used in the retail sales industry. Keep in mind that is the most it can be sold for in any of those years. Actual depreciation will be more depending on condition, sale prep, profit margins, etc. Using that rule and your starting point would put the best sale price in the retail market at around $93,000. What are they asking for it?
He’s asking $120,000. Said he paid $148,000. He’s going to get me the build sheet so I can compare apples to apples. Mine is pretty much fully loaded so I’m not sure why his cost more. Or I’m just a better negotiator.
Should you consider the price of new as well. I’m pretty sure the price has gone up quite a bit in the last couple years.
What make and model is it, just for curiosity?
If you keep and are able to maintain the equipment it will go up in value over the years . About like an old Ford tractor . Set a 30,000 gallon nitrogen tank today with a couple of middle age Grove cranes . They aint for sale ! LOL
I would say hours are somewhat relative to price but I would offer 85 and go from there you can find machines with 500 hours people want 25 percent under retail and machines with 1500 and they want price of new What's the machine worth to you is the real question
I agree it's worth less than 100K and make and model matters somewhat too.
The no warranty factor could be a real bummer if you need it for any reason after the purchase. That needs to be considered in the overall value of the machine. I'm sure you know that. I just pointed it out for anyone reading this and hadn't taken that it into consideration on their own dealings.
I ended up buying the backhoe. It’s a John Deere 310SL. I feel like I paid a fair price. Best thing about it though it’s a tier 3. Don’t mind paying a bit more for that.