Rare and expensive corals

[reefer916]

I've only been in the hobby for a little over two years and never looked at it as a source of income. Actually quit the opposite and it's been more of a money pit, but it's alright and I love watching my tanks mature and the challenges that it provides. However, in the last year I got into the namebrand corals thinking that I could help offset some of the costs of the hobby rather than just enjoying it. By the way, I'm a financial advisor and I deal with predominately high income earners making $400k or more per year. Some of which are reefers, but you'll be surprised that most of them don't collect the $100 per eye chalices or $100 pp zoas. They don't look at the hobby as a investment or even care to frag or trade. They're too busy.. They just like the look of their tanks and tinkering with it every once and awhile, but between family and work there's really no time.

 

So what demographic is collecting the high end stuff for the most part. I've noticed that the high end collector is predominately high school age to about mid-30's with regular household incomes. Maybe making up to $150k per year and depending where you live $150k per year we're just getting by. It's a very addicting hobby and I found myself wanting to figure out a way to help offset some of the costs of the hobby, so I started looking at the more expensive stuff. I figured if I could grow out the nice "Rare" corals that I could frag and sell them to pay for some of the $300+ monthly addiction I have. I have recently decided that it's really not worth the time because of several factors. One of which is the decline in prices of the high end corals.

 

I found it fairly fascinating because in dealing with some of the trades and purchases I've noticed a steep decline in the demand for purchasing these corals due to current economic circumstances. Rising unemployment and people's incomes reducing, as well as, cost of living increases has impacted the market. As well as, forums and articles by some of our reefer colleagues that many of these pricey corals really aren't as rare as we're told. For example, the introduction of the Purple and Red Hornets. Several years ago when first introduced the Purple Hornet sold for over $300 pp and it went crazy. Two years ago you couldn't find them cheaper than $100 pp and now many can't sell them for $35-$50 pp. It's the basic fundamentals of economics, which is supply and demand. The demand for expensive corals has decreased for the most part and and the supply has increased. Prices are dropping because there are also less people getting into the hobby and a lot of people getting out due to current economic circumstances. There will always be the hobbyists who just love the namebrand stuff and are willing to pay for them, but again like anything else they're only worth what you could get for them.

 

Is this a bad thing for the hobby? There are two different view points.

 

First, there's the reefers who spent a lot of money on their corals and wanted to use their "High end" rare corals to trade or grow out and sell. Unfortunately, like many other businesses and investments there is a shorter and shorter list of demand, thus decreasing the value or the amount they're able to sell them for. In addition, some corals are being found, which are similar in looks and colors being imported from distributors overseas, thus increasing the supply. Lineage is important and does demand higher premium due to being aquacultured and adapted to captive life, but I think we're going to notice that the gap in prices between wild and aquacultured frags are going to continue to diminish.

 

Second, there's the reefers who just enjoy the hobby and realize that it's not really a profitable venture. They enjoy their tanks and watching them thrive and grow. Their systems are the centerpiece of art work in their homes and they just love having a piece of the ocean in their living room.

 

I started out enjoying the hobby's beauty and the challenges it gave me. Then I started to look into and try the high end coral collecting and between dealing with fragging, shipping, and finding the time to do it became overwhelming. I found myself worrying about my nice corals dying or not growing fast enough and stressing about them melting or RTNing after fragging and dipping. I also spent a lot of time with guys who tried to make money off of their corals. Virtually all of them have since gotten out of the hobby due to the stress and losing the passion for the hobby itself. Between my wife, two boys, and working full time it's just not worth it for me to try and offset the costs through propagating, fragging, and selling the corals. I've decided to go back to just enjoying the hobby again. I may buy some "Rare" corals, but I'm just waiting as I'm waiting till home prices decline to buy another home:) Obviously, this is just my own personal experiences and I'm sure that there are people making a lot of money out the of the hobby, but I doubt it's the regular hobbyist.

 

Anyone else have any thoughts or experiences?

[johnmaloney]

Your normal demographic for suddenly high priced coral are suckers for the most part. You will want to focus your advertising there. (Really though, the demographics in the aquarium hobby are all skewed towards 30-40 something year olds. )

 

 

kidding aside...the thing about trendy corals is by the time they grow out they aren't trendy anymore. Never buy at the initial price, wait it out and then "invest" when things have normalized.

 

The hobby is entirely driven by demand, supply doesn't really factor in as much as you think it does.

[reefer916]

you normal demographic or suddenly high priced coral are suckers for the most part. You will want to focus your advertising there.

 

lol... I didn't post this thread to call people suckers.. I understand that many are just trying to get by right now and keep their businesses solvent or to be able to stay in the hobby, but I'm hoping to help out some of the younger guys coming into the hobby.

 

I'm always reading posts about how they want to start collecting the expensive corals to make a lot of money. However, what most hobbyist don't realize is that the overhead in any business model needs to be accounted for. Successful businesses run with about 70% overhead of Gross Production and the remaining 30% is net profits. In other words, don't get into the hobby to make money:)

[johnmaloney]

oh I was just joking with you. new releases bring out the people who are bored with their current setup, and are looking for some challenge, or want to upgrade the real estate they have. They usually have experiences with hardy corals, and tend to own multiple tanks. A hobbyist can "make money" selling corals out of their tank as long as they don't bill themselves for their hours.

 

150k a year is a fortune. you just let me know where they make that on a regular basis and I will move there. Boxes are cheap I figure and I can live off Ramen and White Castle. 2 years there and then back to the South where prices are similar to those in Mexico.

[pismo_reefer]

150k a year is a fortune. you just let me know where they make that on a regular basis and I will move there. Boxes are cheap I figure and I can live off Ramen and White Castle. 2 years there and then back to the South where prices are similar to those in Mexico.

 

Ya... for real.

 

I might make 150k, in a good year.

 

[reeftankguy]

I just sold some Noob 25 yellow polyps for $100

 

 

 

 

 

 

 

 

 

 

 

Just kidding... Anyway... I'm not getting it... I always get high end stuff for cheap cheap cheap...

[Dani3d]

Well, I always buy coral for myself to start with. My main reason to buy rare and expensive corals are that I want it for myself. Then if it grow nicely and I have some extra, I can gain back the cost of what I paid for this coral at the begining. If it grow even more, I can make a little money out of this so that I can cover the cost of salt, equipement etc...for my hobby.

 

That's all I want. I really like some expensive zoanthids like the purple, blue and red hornets, and I have my set price on them to what I would be willing to pay, and it does not go pass 50$ per polyp. That's my extreme max for extremely beautiful zoas.

 

Recently we are seing a load of fake hornets and these I am not willing to pay more than 1$ for.

 

We are also starting to see some really nice cones for cheap, like I got 36 magicians for 60$ so the future look promissing as it seem that they are begining to be less rares and more available.

 

It's like everything, the more poeple will buy and multiply these hornets or rare corals, they will become cheaper.

 

 

Anyone else have any thoughts or experiences?

 

 

yeah, me to! I lived in California for 8 years and as a 3d modeler and animator I only got 50k per year and my boyfriend there as a senior software engineer was making 120k and that was a really good salary. I suspect that salary elsewhere in the USA where living cost is less should be even lower...

 

Here in Canada you have to be a doctor to get 150k salary.

 

150k a year is a fortune. you just let me know where they make that on a regular basis and I will move there. Boxes are cheap I figure and I can live off Ramen and White Castle. 2 years there and then back to the South where prices are similar to those in Mexico.

[lakshwadeep]

Rarity is hard to justify unless you have very reliable information; claims of rare or "limited edition" frags are usually meaningless. That's where the john's suckers part comes to my mind.

 

Coral pricing is much more clouded, IMO, because there are many influences for any specific price (regardless of initial collection/shipping costs). Coloration is probably the most useful measure of value, yet there are considerations like lighting or even image manipulation that make it difficult to decide what is worth it.

 

Here's a related article on the high prices of acanthastreas:

http://reefkeeping.com/issues/2005-08/ebac/index.php

[fiction101]

Since when is making 150k a year considered "just getting by"?

[sean151]

Since when is making 150k a year considered "just getting by"?

It depends 100% on where you live and you live where your work is. Same job in Palo Alto, CA would get paid less than if it was in Pullman, WA as the cost of living in the areas nearby would be very different. On topic, I just wait for the zoas and such corals to lower in price and then I'll go for them as I only get corals that I think look cool, but I'm not going to open my wallet to get 3 heads of a frag and then have it possibly just melt away in my tank.

[gutterguy]

Family of 5 and make about 65k on a good year between wife and I. 150k a year I wouldn't have a care in the world!

[tundrashaul]

Since when is making 150k a year considered "just getting by"?

 

I was wondering the same thing, 150k is big money round here, thats a damn good HOUSEHOLD income for the age group your describing IMO

[JoeVic]

If your just making it on !50K a year, then you definately got some financial problems. I don't care where you are located!

[jeremai]

Since when is making 150k a year considered "just getting by"?

Depends on what your standard of living is, lol.

 

fwiw, I'm with John on this one, especially re: supply and demand. Coral prices are almost completely dependent on consumer demand. Zoanthids (!) sell for $100/polyp because people are willing to pay that price; same with a 1" chalice frag going for $500. Sad, but true.

[pismo_reefer]

150k a year I wouldn't have a care in the world!

 

This statement is false.

 

 

 

 

[Dani3d]

Well depends..the statement is 100% true if one only care about money

 

 

This statement is false.

 

 

 

 

[gutterguy]

This statement is false.

 

 

 

 

 

No cares financially...

[Nemo Niblets]

I just sold some Noob 25 yellow polyps for $100

 

Bahahahaha

[naw707]

regarding incomes, yes it all about standard of living. if you are "barley getting by" at 150k a year, id say your standard is pretty high.

 

which all shows how hard its going to be for americans when the realities of our economic situation really starts to hit home. unless you are in the top 5% elite, who will continue to see there money grow no matter what.

[lovelandbmxrider]

around here 150k= 3000sq ft house +

[johnmaloney]

around here 150k= 3000sq ft house +

 

 

shhh! if you let everyone know they may move here and drive our prices up.

 

 

kind of on topic...I guess the best way to "invest" coral money if you are trying that would be to get the next big thing. Not sure who decides such things... Is it as simple as putting op a cool M. spongodes (lets say) for 3800 on ebay and having your friend buy it? Does it follow tank of the month trends? Oddity value?

[bananahands]

Off topic: most would think that 150k is more than enough, but take it from me, you'd really be surprised how much your tastes change or what you're willing to spend. Suddenly you want starphire glass rather than regular, you want a vortech instead of a koralia, leds instead of t-5's. Since you're able to, you buy it. Next thing you know your buying your wife a coach purse just because.

Trust me, it goes quick.

 

On topic: I always figure things are only worth what someone is willing to pay. I don't care what a coral is called or how rare it is. If I like it and I think its worth the asking price I buy it.

[lakshwadeep]

A recent post in glassboxdesign:

Bloom brings up the idea of essentialism, which in “name” is difficult to agree upon, but the underlying points are worthy. Bloom argues that everything, including consumable goods, has an essence to it–and that rarity or price can effect our perception of that essence. That is, if something is rare or expensive, we translate that item’s essence as more profound or meaningful. Kind of like… how aquarists often flock to “rare” corals or a particular “rare” fish.

http://glassbox-design.com/2010/rarity-and...our-fish-picks/

 

Also, lovelandbmxrider, don't you think it would help to say where "here" is?

[Dani3d]

oh no, I still want all those things...I just can't afford them. Having more or less money does not change my taste at all, where did you get that?

 

Off topic: most would think that 150k is more than enough, but take it from me, you'd really be surprised how much your tastes change or what you're willing to spend. Suddenly you want starphire glass rather than regular, you want a vortech instead of a koralia, leds instead of t-5's. Since you're able to, you buy it. Next thing you know your buying your wife a coach purse just because.

Trust me, it goes quick.

 

On topic: I always figure things are only worth what someone is willing to pay. I don't care what a coral is called or how rare it is. If I like it and I think its worth the asking price I buy it.

[krakoski]

Rarity is hard to justify unless you have very reliable information; claims of rare or "limited edition" frags are usually meaningless. That's where the john's suckers part comes to my mind.

 

Coral pricing is much more clouded, IMO, because there are many influences for any specific price (regardless of initial collection/shipping costs). Coloration is probably the most useful measure of value, yet there are considerations like lighting or even image manipulation that make it difficult to decide what is worth it.

 

Here's a related article on the high prices of acanthastreas:

http://reefkeeping.com/issues/2005-08/ebac/index.php

the article had some great information, but that guy thinks he knows way more than he actually does, and contradicted what he was saying multiple times