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This is the worst I have ever witnessed the used guitar market. I had some hopes things would have picked up by May this year, which tends to be the case after difficult economic winters. I have varied interests, so keep a keen eye on the used market for goods associated with those past-times. However, only the guitar market is still stagnated.
The economists among us could theorise on general principles of capitalism to explain the situation. Equally, those with an interest in manufacturing could cite over production and a saturated market. Whatever the reason, how long do you think buying a quality branded instrument will have similar residues on par with the car market?
I often see it mentioned that the used value of a Gibson ten years after purchase would match the price new. Obviously you'll still make a loss if you take into account inflation etc., but I'm making a general argument that any debate can be compared against.
All the above makes the assumption you're not buying to keep, or you'll change your mind during ownership - which I suppose many of us do. For me, it's a moot point as I have what I want and have no intention of selling (for now). But what about those who are trying, or thinking of selling, but need the cash - not another trade. Also, how is it effecting peoples buying decisions ?
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Comments
Downside however, is that I can't sell another guitar for love nor money...and I'd set my heart on the money option!
In 2008, economists were predicting 30% price drops. Buyers stayed away, waiting for the fall - sellers were generally not so desperate to sell that were prepared to drop their prices significantly, ergo the predicted falls didn't materialise.
A market can only ever truly be described as "buyers' market" when a greater number of people HAVE to sell, than are prepared to buy.
I would suggest that most things advertised on here are being sold by serial flippers - not by people who have an urgent need for cash.
In good, bad or indifferent markets, there is always the opportunity for the aggressive buyer to exploit a distressed seller but such people generally represent a fraction of those advertising.
I see this panning out in on of two ways; buyers eventually learn that we are out of recession and it is not their inalienable right to bag a bargain, or transaction levels stay low.
Modern production techniques mean that today's entry level guitars are pretty good. The latest incarnation of the Pacifica 112 is vastly superior to the original model - who'd buy an old one? I've seen them go for £40 on evilbay. And unless you gig or have a large stash of cash why would you want a Custom Shop Strat or Les Paul?
But I think the biggest problem is supply outweighs demand. Fender, Gibson and PRS have flooded the market with guitars at every price point that ultimately find their way into the second hand market. There are more sellers than buyers.
Remember, it's easier to criticise than create!
And I think there is an information mismatch which is a bit worrying. The dire warnings from Shelter (half of households in the North are 1 month away from financial disaster). Huh? A quarter of teachers are bringing food into school to feed kids who are hungry. Huh? Most payday loans are used to buy food. Huh?
The mismatch is that this does not sound like an economy with 2m unemployed. This sounds more like an economy with 5m unemployed. In which guitars are hard to sell.
Maybe we do have 5m unemployed - by any reasonable measure of "work".
Shift in the economy which means people's disposable incomes are not what they were pre 2008. I really feel that you step out of the SouthEast & London times are very hard for people.
Our purchasing power has declined greatly in the last few years,which equates to there being little
money spare for hobbies/interests.
The fact that manufacturers have pushed up new prices of instruments is irrelevant to 2nd hand values,which will
always reflect the true worth of stuff !
Many people are just expecting too high a price for the market today,especially for damaged and messed with
instruments .
The survival rate on *all* guitars and valve amps is very high. Therefore you can realistically count on around 60% (my guesstimate) of all guitars made still exist. Therefore, electric guitars are far from being rare - no matter what the brand.
Having visited a Korean factory and watched literally 100s of PRS guitars trundle through the line over the course of a normal week for them, it's an amazing thought that all these will find homes. Especially when you see them all packed up ready to ship... Factor this in, and their high quality vs price, its no wonder that mid price 80s guitars (for example) just can't compete - but guys on eBay still put them up for daft prices.
I will also say that the impulse buy in a guitar shop has gone away. People now search eBay or online shops for specific guitars - often that they are told are 'cool'. The days of just browsing a shop and spotting an unloved gem have passed for most of us - and that was when you may try something outside of the norm.
I think the s/h market is barely ticking over - and it's because the whole guitar market is flooded. Totally swamped.
It's a shame but its a fact