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Osho Offline OP
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Hi,

I have searched in this forum on how to use Piano Buyer's depreciation schedule. This is a great resource and very well done - so thanks and kudos to Larry Fine and Steve Cohen on creating this! I am summarizing my understanding below to make sure it is correct and I am not misunderstanding anything.

To estimate a value of a used grand piano from a dealer(in my case a 7' or larger is what I am interested in):
  • Start with the SMP of the same model, Say SMP is $100000.
  • Typically, new pianos sale for 10 to 30% off SMP - let's say we take 20%. So, new piano current market price will be $80000.
  • Suppose piano is 35 years old and in "Better" condition. From the depreciation schedule, this will be 25% of $80000 (extrapolating after 30 years). So, it will be $20000. This is the current market price for private sales.
  • For dealer sales, we add 20-30% margin. Let's pick 25%. So, it will be $25000.
  • Suppose the dealer has done extensive work on the piano (new action, strings, pin block whatever) and it roughly costs $5000. So, the final price of the piano will be $30000 when purchasing from the dealer with the typically a few years of warranty on used pianos


Is this calculation correct? Am I missing something?

Thanks,
Osho

Last edited by Osho; 06/23/21 08:17 PM.

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I would go with market comparables. Their depreciation scale looks wonky. We bought a late model Steinway D for wayyyy less than they have shown there.

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Thanks for the response.

Originally Posted by oldMH
I would go with market comparables. Their depreciation scale looks wonky. We bought a late model Steinway D for wayyyy less than they have shown there.

It's really hard to find market comparables. I am curious what sources did you use for market comparables?

Thanks,
Osho


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Hi Osho,

Yes you are correct. That's the way to get the fair price according to PB. That does not mean that you can't find a dealer which will ask much more (especially if they are located in an area where their expenses are still high, whereas their sale volume is low), or much less (for the opposite reasons, or just because they need to get rid of the instrument to get back the floor space for something else).

And obviously you have also to weight in several other aspects which are not included in the discussion: if the local craigslist is flooded with similar instrument, price needs to be lower regardless. If the piano is quite unique AND very desirable, it could be the other way around (if it's quite unique but there is no market for it, that pulls the price down).

In your case, since large instruments are both rare/expensive and not very desirable (because most people don't have the necessary room), you can go both ways: if you are in a hurry and really love this piano, price could be high; if you are patience and can wait for a deal, you may get a great one. Examples in my local market (which I monitored to find my perfect piano, see my other post about it). A few weeks ago a great 9' Lester was sold at a bargain $5,000 (just five grands, I have not forgotten a digit) whereas it's months that an equally great 9' Baldwin does not sell at its fair asking price of $25,000

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Originally Posted by Del Vento
Examples in my local market (which I monitored to find my perfect piano, see my other post about it). A few weeks ago a great 9' Lester was sold at a bargain $5,000 (just five grand, I have not forgotten a digit) whereas it's months that an equally great 9' Baldwin does not sell at its fair asking price of $25,000
How do you know the Lester was great? What was the condition of each? Were the ages of the pianos similar? Is Lester known as a high quality piano?

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Originally Posted by oldMH
I would go with market comparables. Their depreciation scale looks wonky. We bought a late model Steinway D for wayyyy less than they have shown there.
But remember the depreciation schedule was probably based on hundreds of comparables from different areas of the country. It's possible the scale doesn't even include full concert grands because so few people buy these for home use.

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Originally Posted by pianoloverus
Originally Posted by oldMH
I would go with market comparables. Their depreciation scale looks wonky. We bought a late model Steinway D for wayyyy less than they have shown there.
But remember the depreciation schedule was probably based on hundreds of comparables from different areas of the country. It's possible the scale doesn't even include full concert grands because so few people buy these for home use.

No, if it was based on hundreds of data points, there would be values that don’t end in zeros or fives. It’s a loosey-goosey contrived approximation.


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Originally Posted by Retsacnal
It’s a loosey-goosey contrived approximation.

Agreed. All these calculations are worthless in the face of what drives any market : The law of offer and demand. And that offer, and demand, is volatile and unique to every day and to every geography. Look at a Tesla share or a Sotheby auction of what passes for modern art !

Statistics can only work when based on large numbers of both goods and similarly-minded buyers and sellers. This is seldom the case for pianos. There are few commodity acoustic grand pianos : the Yamaha CX2 is probably the only contender since the demise of the mass piano market brands such as Baldwin in the post-war lifestyle revolution.

When dealing as you do with 7ft + grands, you are talking about miniscule numbers of transaction, and very limited by geography since pianos are such heavy brutes to move around. Your dream piano is probably a one and only specimen. So are you.


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Hi Osho.

First, thanks for the kind words. Larry and I spend about an hour a day working on different issues related to PianoBuyer.

The Depreciation Schedule is designed to provide guidelines, not steadfast pricing. Does it have weaknesses? Yes, but in general its is a good tool for estimating value.

And...stay tuned......


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Originally Posted by Retsacnal
Originally Posted by pianoloverus
Originally Posted by oldMH
I would go with market comparables. Their depreciation scale looks wonky. We bought a late model Steinway D for wayyyy less than they have shown there.
But remember the depreciation schedule was probably based on hundreds of comparables from different areas of the country. It's possible the scale doesn't even include full concert grands because so few people buy these for home use.

No, if it was based on hundreds of data points, there would be values that don’t end in zeros or fives. It’s a loosey-goosey contrived approximation.
They might have just rounded to the nearest 5 or 10 increment. It's not meant to be some incredibly precise figure which is not possible because there are many factors in a specific situation that can affect some approximate figure.

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Originally Posted by Vikendios
Originally Posted by Retsacnal
It’s a loosey-goosey contrived approximation.

Agreed. All these calculations are worthless in the face of what drives any market : The law of offer and demand. And that offer, and demand, is volatile and unique to every day and to every geography. Look at a Tesla share or a Sotheby auction of what passes for modern art !

Statistics can only work when based on large numbers of both goods and similarly-minded buyers and sellers. This is seldom the case for pianos. There are few commodity acoustic grand pianos : the Yamaha CX2 is probably the only contender since the demise of the mass piano market brands such as Baldwin in the post-war lifestyle revolution.

When dealing as you do with 7ft + grands, you are talking about miniscule numbers of transaction, and very limited by geography since pianos are such heavy brutes to move around. Your dream piano is probably a one and only specimen. So are you.
1. Right now there are 220 6'10" or longer grands for sale on PianoMart. This does not seem minuscule to me.
2. How can the figures in the charts be "worthless" if they are based on data points and the experience of those who designed the chart?

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Osho Offline OP
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Thanks all for the input. This is very valuable.

I will use the depreciation schedule in my search. Sometimes, I find that some dealers have posted prices in the show room that are double what I will get following the method in the OP. I wonder if that is just there so the dealers can negotiate a lot and still make the buyer feel like they are getting a good deal? Or, something else?

Osho


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