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Sale price guess too low

GREG PETERSON 03/21/2012 @ 2:27pm Greg Peterson writes "Machinery Pete" column for Successful Farming magazine and appears on the Machinery Show on RFD-TV, talking about trends in the used equipment market

$115,000 was my sale price guess.

Up for sale yesterday on a large absolute consignment auction in west-central Illinois was a 2008 JD 7830 MFWD tractor with 1,438 hours. In my $115,000 price guess I tried to factor in the current “premium” level of spending I’ve been seeing since last August for really, really nice condition used farm equipment, particularly tractors. I’ve written and spoken a ton here the last six-plus months about this “premium” and how its driven by the super high cost of new equipment, strong farm income and the scarcity of machinery auctions.

So how close did I come on my $115,000 sale price guess? Too low, big surprise I know. The JD 7830 tractor sold for $119,000. Here’s a Youtube video of it selling I posted last night:


This auction yesterday was by Sullivan Auctioneers on their sale yard lot in Hamilton, IL. You may have noticed at the start of the 7830 selling auctioneer Dan Sullivan is talking to the owner of the tractor, a local widow whose husband recently passed away. She nicely and in matter of fact style simply told their experience with the tractor. Towards the end of the bidding Dan Sullivan stopped for a moment and reiterated….”folks, this is hard to find 1-owner tractor.”

Couple more late bids came in and it sold for $119,000.

Now you might ask how did I arrive at my pre-sale price guess of $115,000. Just going off the latest hard cash actual sale price data, see for yourself by clicking on the link below:

Note the 2008 model 7830 with 1,085 hours sold for $117,000 on the February 22, 2012 farm auction in west-central New York, so 350 fewer hours than the 7830 sold yesterday on the west-central Illinois consignment auction. Note also the 2007 model 7830 with only 783 hours sold for $121,000 on the November 21, 2011 farm auction in northeast Kansas. It was going off these recent examples I based my $115,000 price guess on.

Too low.

Just like I missed too low on my sale price guess on the 2004 CaseIH 2366 combine with 1,213 engine hours on a farm retirement auction last Saturday in southeast Minnesota. My price guess was $120,000. It went for $140,000 (no heads), a new record auction price.

There’s that “premium” factor I was talking about.

So now this coming Saturday, March 24, 2012, I’m off to cover a farm retirement auction in Jordan, MN, just west and south of the twin cities. On this sale is a 1989 JD 4455 2WD tractor with 2,567 “1 owner” hours.

Hmm.

What’s your sale price guess? I’ll shoot video of this tractor selling and also the 1998 JD 7210 2WD tractor with only 619 hours, also “1 owner”, and post a Youtube video Saturday evening after the auction.


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