Sales Price vs Actual Purchase Price

[NCRider]

I’m not sure you’re getting the best advice for buyers. The advice you are getting in this thread is more like a wish list by sellers. Of course they’d prefer buyers who are going to show up and pay asking price for the horse.
You want the best horse you can buy for your dollars. I would say it’s OK to look at horses out of your price range if they should be in your price range based on comparable horses you’ve seen in terms of age, ability, experience, etc.

At the price range it sounds like you’re talking about, failing to negotiate on asking price could cost you tens of thousands of dollars in that you didn’t need to pay.

[fordtraktor]

There’s a little room at the top of the asking price on most horses. I have four and I didn’t pay asking price for any of them. I always ask for something off the top, it’s basic Horse Buying 101.

It’s not that I would never pay full price as a matter of principle…but as a matter of principle, I also wouldn’t throw money away by not even bothering to negotiate either. It’s not insulting – I negotiate when I buy a house, a car, at yard sales…why not when I buy a horse? In the same vein, seller can say no and not offend me if the horse’s price is firm. It’s not personal.

[scubed]

In addition, I’ve sometimes paid “full price” for the horse, but gotten shipping or 2 weeks board or … thrown in with that purchase price. That is money I don’t have to spend, but it is all part of my budget for the horse purchase so works the same as getting $$ off the price of the horse. I pretty much always ask what room there is for negotiation and have never had a seller seem offended or upset by that.

[JP60]

This has been a fascinating thread. Like almost any economy based on subjective costs, a little eye opening and disconcerting as well. I am an open book when it comes to subjective sales. Sellers can see me coming a mile away and say “here comes a ripe apple for the picking” and they are right. Negotiation is not my strong suite and since I don’t like drama, I certainly don’t feed of the “art of the sale” like some. In the two times I’ve bought a horse, and a current situation where I am trying to save a horse, in those three times I’ve meet met the scum of the horse world twice and has put quite the sore taste in my mouth.

Y’all sellers talk about the troubling buyer, could we turn the mirror for a moment?

Lady tells me this is a full blood trakehner, oh but don’t have papers
Lady tells me she’s 13 (she’s more like 18)
Lady tells me she’s in good shape (+3-2.5 on the weight scale)
Lady tells me she’s worth $5000 and sound as the day is long, don’t need no PPE (has lower ringbone, +2, loose stifle +1)

Lady responds to my offer, which came from investigating papered trakehner who jumped X high and was around x age and had leg issues to manage by saying, “I could get more from slaughter”…And she was a horse seller.

Another lady let’s her horse starve to +1.5, destroyed the tendons in the right rear, let the hooves grow to dinner plates, and at one point says “maybe I should put her down”; turned around when I offer just to take her off her hands says, “how much”.

Sellers are not always wearing white hats.

But on to the fascinating part for I have wondered how horse sellers decide the price of a horse. In manufacturing it is pretty straight forward to set a price on an object; labor, material, infrastructure and volume get factored into a final price and other than odd markets (like cars for example) the price is fixed.

When pricing a horse for sale, how is the price determined, for having gone through buying my current eventing horse, the prices seem subjective and random which means that from a buyer end, of course I want to negotiate since I see a similar horse over there for a similar price I can afford. If I offer you $6000 it may be because I did some comparative shopping and found that your $15000 is perhaps just a little to optimistic.

Is there a difference between breeder and sellers, for I can see a breeder pricing based on cost and labor. Feed, medical, care, basic training all going into a base price times some profit. Yet, we know you don’t tell us that price for the moment you say “this horse came from so and so” than the price goes up even though so and so is dead and there is no guarantee young so and so will do as well. Nature vs nurture and I ponder that nature has been setting the price for a long time without any proof it means a damn thing to the value of a horse. It’s like a car salesman selling me a porsche 911 “This baby will do 0-60 in 3 secs, top out at 200 mph and turn on a dime” so I buy it never even coming close to that performance.

But re-sellers? You guys really got it tough for everything you do is based on market forces, not actual valuation. If the market does not want to pay $15000 for a mid-level Eventer then the whole model changes so you convince us that without this horse, my goodness you’ll never make it to Rolex (or the buyers version of it). I know a rider who had this tendency of getting refusals at xc fences. To fix the problem the family goes out and buys a mid 5 figure horse with tons of experience. First show, you know what’s coming, the horse refuses a jump. After that it happened again and eventually the rider got out of eventing. These are thinking creatures,you may train them, you may put $15000 into them and charge $25000 but that does not mean they are worth that in some hard sense. It is a judgement call so to say “I won’t negotiate” is to say that anyone riding this horse will get the same value and we know that is not truth.

You job is to maximize the subjective value of a horse to a huge crowd of amateur riders who never make a dime riding the horse, but somehow feel they need that vunder horse to do their best. Y’all do it well for we open our wallets and hand over the green.

I realize I sound jaded, and I am, but after reading through the litany of responses from sellers telling me how I need to behave, I’d like to point out that

A picture of someone standing on a horse is not a good selling point next to a 5 figure price.
Showing up to see a horse and having that horse look worse than the photo, than in the same moment told “you want to try this one as well?” does not bread trust
Showing up to ride a horse, like the horse, come back a couple days with cash only to find the horse, that was not lame on showing, now was off and later had “issues”.
Showing up to try a horse that is stated is beginner friendly and watching as the horse paces in a stall and never stands still in cross ties.
Showing up to try a horse only to be told that the horse had just been hard ridden for two hours, you still want to try? (We had only traveled over an hour to do so).
Showing up to look at a horse and no one is home.

These are all personal experiences as I looked for my horse and a horse for my SO.

The list goes on. Maybe there are good sellers out there. Maybe some of them are on this list, but for me, I would not choose a seller or breeder as my first choice in buying a horse. For them, it is a business, it is about making a profit, but making a profit in a subjective industry that is closely tied to emotions may not turn out well for the buyer.

My advice, buy from a local private owner first for you have the ability to find common ground
Next buy from a local trainer who has a good reputation for not only can you see the horse at work, but if they make a bad transaction it will quickly impact their business and they may look for training work as well from you.
As a private party I would almost never buy out of state or long distance. There are too many horses around, close by one’s home to warrant taking a chance.

I bought my awesome International Horse of Mystery from a private sale, inside two hours, and we were able to negotiate a fair price based on her description of his experience, his age, and what I could afford. I bought him because he was gray and he looked at me and said “You, make it happen, I’ll teach you more than you’ll ever know about horses and riding”. So far he has.

[bornfreenowexpensive]

[QUOTE=NCRider;7737532]
I’m not sure you’re getting the best advice for buyers. The advice you are getting in this thread is more like a wish list by sellers. Of course they’d prefer buyers who are going to show up and pay asking price for the horse.
You want the best horse you can buy for your dollars. I would say it’s OK to look at horses out of your price range if they should be in your price range based on comparable horses you’ve seen in terms of age, ability, experience, etc.

At the price range it sounds like you’re talking about, failing to negotiate on asking price could cost you tens of thousands of dollars in that you didn’t need to pay.[/QUOTE]

I absolutely disagree. The OP asked what to expect. I’ve recently been both a buyer AND seller of horses in the range I think they are talking about. Fancier nice horses with training and competition experience–NOT project horses or ones fresh OTT. Those ABSOLUTELY often go for the advertised price. I have one for sale now at 25K…she is young, very well bred, fancy, easy to ride and has some good competition miles. Her price is NOT going to come down. We have 2-3 people looking at her a week (shortly after she was first advertised). Two are already coming back for 2nd tries. I have a BNR who wants to test drive her after the WEG as well if she hasn’t already sold. I expect her to sell within a month of her having been advertised—for her asking price. If not, I’m not droping the price as we will continue to train/compete her and her price will likely increase. Her asking price is what we think is fair for her given her current training and her potential…and is price at what we are willing to part with her at this time.

It absolutely depends on the horse being sold—and to a certain extent location and who is the seller. If the horse is what many buyers want…Their asking price and actual purchase price will absolutlely be the same most of the time. I’ve even known of a few who sold for more as buyers got into a bidding war.

BUT if the horse is difficult, quirky, or has issues on their PPE…then there may be room to negotiate. Or if the Seller has outside issues that motivates them to sell. No it never hurts to ask…but you will get people who say…like we do…that the price is firm.

It really depends on the situation. IME…nice and easy to ride horses (with training) sell relatively quick, easy and for full price because they are what every buyer wants. If you are looking for the younger, nice type with some training, uncomplicated to ride…and what 90% of the buyers are looking for…you are going to often end up paying full price.

IF you are looking for a project or willing to take something small, quirky or green or older with issues on PPE…you will likely be able to negotiate the price a bit. But don’t expect to be able to negotiate the price on the horses that everyone is trying to buy.

Some sellers DO inflate prices a bit just so they can negotiate the price. But others do not. And as a buyer, you will not know unless you ask but the OP ask do horses sell at their advertised price…and my point is there are a LOT who DO.

[Xctrygirl]

For me, and I am currently helping to sell ones at the track as an “agent” type deal, and I have 2 of my own for sale. I see and talk to a fair numbre of folks buying horses. Universally I think the buyers want to not feel like they paid too much and the sellers want to feel like they didn’t give the horse away for too little.

Each situation is different and the areas I have seen to make a difference are giving a horse a permanent home, giving regular updates, offering a type of guarantee and adding conditions that allow the seller to know the buyer will care for the horse extremely well.

I think many are correct that if you can’t afford full asking you may be wasting time and effort on a “Hail Mary.” That said, if you’re within $1-3k difference it’s worth a shot, but I would walk in saying something like “Look I know I can’t afford your horse, but I have $15k to spend (on a $17k horse) and I can offer regular vet care with the best clinic in the area. And it will be insured and be trained by (respected trainer) would you possibly allow me to look at it?” It can help sometimes. Just be prepared if they say no, be polite and thank them for the consideration.

~Emily

[Backstage]

@judybigredpony;7737369

Backstage I beg to differ…I sell 99.9% of my horses 25-30 a year for full price anywhere from $5000. To $15k and would only negotiate a price if something came up,in PPE.[/QUOTE]

That’s great. But that is you, as one seller. You are also, if I understand correctly, a professional seller. That means (or should mean) you have developed a business model that works. I would expect you to have determined the price point necessary to move a horse in a reasonable time frame, and to price that horse appropriately for the market. Don’t forget that many, many people are out there trying to sell horses and many of them are not professional horse sellers, even those that are horse professionals. There is a distinction.

[QUOTE=bornfreenowexpensive;7737434]I also really don’t agree…that at least has not been my experience (from buying and selling and knowing what others are selling for).

I’d love to hear more about that. Think of the last 20 horse sales you have knowledge of. How many of those were from sales barns? I’m genuinely curious. Because when I think of the last 20 horse sales that I have knowledge of, I can think of 3 sales that were at asking price. Two of those involved horse sale operations. The 20 sales run the gamut from lower end to higher end.

[bornfreenowexpensive]

[QUOTE=Backstage;7737787]
That’s great. But that is you, as one seller. You are also, if I understand correctly, a professional seller. That means (or should mean) you have developed a business model that works. I would expect you to have determined the price point necessary to move a horse in a reasonable time frame, and to price that horse appropriately for the market. Don’t forget that many, many people are out there trying to sell horses and many of them are not professional horse sellers, even those that are horse professionals. There is a distinction.

I’d love to hear more about that. Think of the last 20 horse sales you have knowledge of. How many of those were from sales barns? I’m genuinely curious. Because when I think of the last 20 horse sales that I have knowledge of, I can think of 3 sales that were at asking price. Two of those involved horse sale operations. The 20 sales run the gamut from lower end to higher end.[/QUOTE]

All the ones I know of other than 2 (out of the last 15 that I can think of without effort— NOT Fresh OTTBs or projects) were sold by professionals. Not random horse owners but most are not “sale” barns. They were by professionals who make their living training and selling horses. I was thinking of horses going at least Novice already and most were going at higher levels. On the buy side, of buyers that were buying that I know what they paid-- most of the buyers that I know are also professionals (buying a higher level of horse–going Prelim, looking like potential UL horses). Most of the non professionals that I know buying horses are more like myself who tend to buy project horses-- green unbroken or fresh off the track. And that wasn’t what the OP was asking about.

and from what I hear from both buyers and sellers is that there are NOT a lot of nice horses for sale. The market is tight for the going fancy younger horses. There are a lot of green or older but finding the fancy young n/t/p horse ready to move up levels without issues (uncomplicated to ride) is hard to find.

[Beam_Me_Up]

There is such a range it’s hard to generalize. Plenty go for full price, but we’ve all heard the tales of people (or been the people) who bought for pennies on the dollar (emergency sale, hard to place horse, etc.), which gives buyers hope.

IME as both buyer and seller, most non-professional sellers are expecting to negotiate ~10%, maybe 15%, but that includes the ones who are way overpriced too (IOW, most sellers feel they are priced fairly and might build in a little negotiation room–nobody thinks they’re smoking the crack themselves).

If I like an overpriced horse I will still make an offer. It can insult the seller, but if it isn’t worth more, it can’t hurt to ask (politely).

With horses slightly out of the price range, I never know the best approach. As a seller, I pretty much ignore the ahead-of-time inquiries asking in if I will drop the price significantly or how low I will go. Those aren’t serious offers, or really offers at all. Who knows if they will even get along? At the same time, after someone flew in from out of state, tried my horse for 3 days, and offered me 10% of asking, well, we both wasted a lot of time needlessly.

I don’t personally look at horses out of my budget because I don’t like to waste my time

[judybigredpony]

Well said Beam Me Up…

Yes BackStage I do have a business model which over time has had to evolve with the Economey and shifting demands. As BFNE said there is a shortage of the Fancier horses…while most of what I sell is Not made competing I have found a niche in the Fancy FEH and YEH market where Professionals and the next level,of are seller are looking.
But not to hijack the OP s question. When I go shopping I go prepared to pay full price and Only after I have actually seen the horse or PPE do I negotiate. I also try to build in a $$ if it’s “that nice” and offer more when several buyers are involved.
I will be honest and say I have X to spend and if Seller has horse in my price range I will look at that horse. But if it’s out of my pocket book By more than $500. I don t bother a Seller. My shopping price range to buy is $2500-$10,000. and that doesn’t include PPE or Shipping.

[whbar158]

There are a lot of factors as to why a seller may take a lower price. Someone who is a horse seller, purposely buys horses to resale them, knows the prices well, and is going to be well networked with a great system. They probably are only going to lower the price if the horse has sat for too long and it is likely for many to have the price go up the longer it is there because the horses are becoming more educated with time. Now the 13 year old solid citizen horse owned by an ammy owner may or may not come down in price easily, does the owner want another horses? Do they have to sell this one to get another? Do they already have another horse? Can they afford to keep two? If they can afford two and already have their new horse they may be willing to sit on it and get the price they want. If the horse can still do the job they want but they are just looking to get something that can go farther they are probably happy to continue to ride their sale horse until they get the price they want. Generally people I know who have gotten pretty good deals the horse has been for sale for awhile price may be a little above market value but generally the owner just decides horse must go and is willing to take a hit. Some sellers may put their horse on the market before they are really ready to sell so they price it a little higher so if that person wants the horse that bad they will pay extra. I think its ridiculous to expect to drop 50% of price off and offer that without discussing if the price is even negotiable so it depends on who the seller is and why they are selling to me.

[Feliz]

Here is my limited buying/selling ammy opinion:

There aren’t that many nice horses out there. If they are priced realistically they are generally sold very quickly, therefore the price isn’t (very) negotiable. (I’m looking for youngish, going over fences but not necessarily been out competing).

So I’m happy to pay full price and I only shop within my price range. The last three horses I’ve bought have been from honest, knowledgeable horse people. I thought each horse was fairly priced – not bargains – but a good price for that horse. All worked out extremely well and I paid a lot less for them than I could have by travelling out of my area. All three sellers were fantastic to deal with.

Each seller has been someone who brings along young horses – two as a bit of a hobby, the last is a full time breaker/trainer. All 3 horses were young-ish (4, 6 and 8) and had genuine potential, but had little things that made them affordable for me (size, quirks etc). I haven’t tried to shop for a big, easy going, super star potential gelding on my budget. (Current horse is a small, quirky, oodles of potential gelding instead – he was under my top range price but needed lots of work).

I now won’t call up about a horse that I think is significantly overpriced. IME the sellers are usually somewhat delusional and even if they are willing to drop the price- well, there always seems to be something odd going on. I guess I just don’t have much patience for that kind of thing anymore, on the off chance that I will get a bargain.

I think it’s just so much easier to deal with someone who knows what they have, prices it fairly and is good to deal with.

[Linny]

Seems that there are 3 general categories:
First, sellers who are firm. They may be resellers (like JBRP) who have a model, know what to buy and have an established client base of trainers. They typically negotiate only if an issue comes up or if they are in a “cash flow” shortage at the moment and want to refresh their stock but need to move a horse or two to do so. They are typically own or lease the property on which they work so “another month’s board” isn’t an issue.
Second are the “firm but…” sellers. They feel they have priced the horse right and don’t want to negotiate but they may make exceptions for certain ideal circumstances. Some sellers start firm but then adjust when either no offers come in or bills start piling up on horse. If horse is boarded, turning down an offer $1k below asking is might be crazy. This is the toughest category, as many times the ad says “FIRM” but they are really not firm in that circumstances exist under which they will deal. They are sometimes just people who hate the who process of negotiating.

Third is the very flexible seller. They need to sell for whatever reason.

The issue that the buyer has is that unless they ask, UPFRONT, they have no means of knowing which category, you as a seller, are in. I know JBRP, for example. I’ve been to her farm, read her posts and spoken with her. If I were looking at one of her horses, I’d know that she is in fact firm, unless there are some other issues. OTOH, if I call on a horse and have no prior knowledge of the seller, if I don’t ask I may overpay. If I’ve seen the horse listed on your site or a national sales site for 5 months and the price is the same, no updates to say he’s won something or done something new, I’d be crazy not to ask if you might negotiate. Now, maybe you won’t, and that’s fine, but if you have done everything to sell this horse and he’s sitting around 6 months later, maybe the price is the issue? Not many people are out horse shopping in upstate NY in January. The horse that was $10k in August because the kid is heading to college better sell fast or the bills start adding up. I imagine that the reverse is true in Ocala or So. Fla when wealthier folks start drifting south, it might be easier to be firm on prices there. Some sellers go from firm to negotiable if the horse will be in what they see as an ideal place or with a BNT barn or a trainer who they respect.

[kcmel]

Good points Linny. The only recent horse I paid (almost) full asking price for came on the market the morning I was vetting another horse, that horse failed, I contacted the seller immediately, rode him the next day, trail rode him the day after and made an offer. Since he had only been advertised a couple of days, and I thought from all the horse shopping I had been doing that he was priced fairly, I didn’t do much negotiating. I knew he was the type that would go fast.