How is value REALLY appreciating for horses?
I see so many people take on a project ish horse and all of a sudden it has doubled in value.
Is it shows and safety that build them up?? How much? Heck, my close friends upcharge SO much money if their horse has good, recent rated trips. I just don’t understand the markets to be honest.
I don’t think most people understand the horse market most of the time.
But in the end, people in the show horse market want to buy what is going to win the class so if someone buys a prospect, puts miles on it with a proven show record then it makes sense that the sale price would be an increase from the purchase price.
You have to add to buying a prospect the knowledge to pick right, to train right and market right.
Plus the inherent risk horses are, a step away from something going wrong.
That adds to the cost of the ones you make money with, to carry all others that don’t or even cost you way more than you could ever get back.
Those gems then are valuable and knowledgeable buyers looking for those happily buy them for more, as a known quantity, not a prospect any more.
Agree with what everyone else says, and I’d also add, it’s easy to buy a project horse that looks good, vets sound, and seems sane…and then when the flipper starts to put training and miles on him, it’s clear the horse doesn’t have the scope or brain to be what he/she was hoping to turn him into (like a kid’s pony with a wicked spook or a scopey hunter that has a meltdown at shows and requires considerable massaging and coaxing to calm down, beyond what is normal or expected). When a horse that is more “made” is bought, buyers are paying for some slightly greater assurance they know what they are getting.
Plus, showing itself is expensive, and the seller wants to recoup the costs in the sales price.
Having had 2 resale projects in the past 5 years, one of which I sold for 3x what I paid and the other 2x what I paid, it was giving the horse some training they didn’t have before and proving that they could be solid citizens. Both were sold between $10-15K, so not super high end, but both came to me basically knowing how to steer and stop. I taught them how to behave, trailer, horse show, and most importantly, ride like actual First/Second Level dressage horses. This process took over a year with both of them.
I don’t understand the market either and I’m a terrible seller because I will just about give a horse away to a good home before I try to make a profit. I’m a sucker.
But I will say, I don’t see the market sustaining increasingly high prices very long. I’m involved with animal rescue and I can tell you that the number of unwanted animals is increasing. I am also seeing more horse sales due to financial constraints. The cost of maintaining horses keeps increasing. I just don’t see high prices lasting long.
The target market is the determinant. And there is not one generic horse market. You have to understand what your target market desires and is willing to pay. Then you develop your project for that market.
This is true. Horse sales are very subjective. The horse is worth what somebody will and can pay - not what money was spent on the horse. If you can buy it cheap, train it up and it is a diamond in the rough and you can sell it for multiples of purchase price then you made a profit. Kudos to you. This doesn’t happen all the time. Sometimes that horse has limited talent, trainability and poor vetting results and you have to eat your costs. Marketing and knowing your target market’s preferences determine what you can sell it for. And luck. Don’t discount luck!
You have to know your buyer/market, be able to recognize raw potential that will appeal to that market, be comfortable with the risk of the horse being unsuitable/unsound, have the skillset and help to develop the horse correctly for their intended job, and then market them well.
I’ve sold two this year for a lot more than I bought them for, one project and one fancy prospect. I broke even on one, made money on one. From the outside I’m sure both looked like a pretty easy flip, especially since one was only in the barn for 3 months. But it’s a calculated risk to buy them, and then a lot of hours, sweat and tears goes into the process of bringing them along.
Talking about doubling, tripling, (or more) in value is absolutely nonsensical in the horse world.
What you pay for the horse has almost no relation to what you sell a horse for.
What you can sell a horse for is directly tied to how much risk you took in buying a horse and in direct proportion to that, how much you’re able to prove what the horse can handle. In other words, someone who goes to the big shows and puts the miles on the horse will always be able to sell a horse for more than someone who only schools at home. And someone who demonstrates what the horse can do (i.e. horse can jump big jumps followed by video of the horse jumping big jumps at home) can sell a horse for more than someone who says a horse “can” do it with no proof. And so on.
But the ability to buy a horse for $5k and sell it for $500k, has no relation to that initial investment price. Which is why someone with a good eye can buy a horse for $500 and then put it on the market for $25k a few weeks later. No, the horse didn’t “increase in value,” but the person with experience and a good eye found it and put it where it could have been all along.
Realistically, every zero that gets added on is just one more degree of guarantee that the horse will do it’s job. Breeding is one degree. Training is another. Conformation and looks are another. A winning show record is yet another. Add up enough of those points and any horse moves into the higher range. Again, often totally independent of the purchase price.
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