When opportunity knocks, do you answer the door? The knocking sound you’ll hear this summer will be the chance to buy large, late-model used farm equipment via auction, private sale or dealer for a bargain.
I’m not in the business of making predictions. I prefer to analyze the hard cash sale data as it rolls in from our network of 1,000 auction firms in North America. That said, there will be good buys this summer—and these opportunities could help you get a leg up on efficiency.
Here are the reasons behind why I think we’ll see softer values on large, late-model used equipment:
- For the past two decades, our auction data has consistently shown values on big ticket used items tend to soften during summer months.
- There was a 15% to 25% drop in values on large, late-model used items in August and September 2014.
- Dealers still have excess inventory of large, late-model used units.
- My auction sources indicate there will be more farm retirement auctions.
- We can’t neglect the influence of lower commodity prices, either.
Queue the knocking; herein lies your opportunity. It’s not easy to spend money when margins are tight. But when no one feels like buying, it’s often the perfect time to buy.
Don’t think you can afford a 24-row planter? Check out the data table below and see how Case IH 1250 24-row planters have fallen 24% in value in 2015. The same trend holds with John Deere 1770 24-row planters, which are down 18.6% in value versus 2014 and 33.5% versus two years ago.
You might be tempted to wait until year-end to buy, but remember everyone else likely feels the same way. For the past 12 years, auction prices have risen in the fourth quarter.
If you want to put yourself in the driver’s seat as a buyer, pay cash off the dealer lot. Economics are in your favor, and the dealer will appreciate one less headache.
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