Can horses ever be an investment?!

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KatB

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Just thinking, can you ever really make money from buying and selling horses consistently, or is it more of a lucky break if you do? Just pondering if I had some spare cash about the place, whether a "horse" investment ever would be worth a punt?!
 
There is a very old saw about how to make a small fortune on horses..... start with a large one.

Never invest any money you cannot afford to loose. Clearly people do make a living selling horses, but it is a far from easy or risk free way to make a living. If you can afford to loose the money and this is what you want to do with it then go ahead. You might get lucky. But if you can't afford to loose it make a more sensible investment choice!
 
I think if you own your own place, and you buy the right prospects then put the time in, it's possible. But it only takes one big bill or soundness problem to wipe out profit. Plus if you costed in your time properly you probably wouldn't break even.
 
Hummmm... I would say there are a million more safe, stable and secure ways to invest. The risk potential is huge with a horse and is not unlikely to be a good risk - hence unlikely to see massive return even with all being well....

The on going costs with a horse can make or break the investment if it does not sell in the alloted time frame and thats with out it not reaching its potential or any problems you pick up along the way...

That said... I think if you have your own land or access to relatively cheap stables/grazing its doable....

Whilst in Uni I bought and sold a few and worst I did was to break even after costs....

That said that wasnt taking into account my time... In which case I would have sold every thing at a loss inc one I made £1500 on in 2 months!

Good luck!
 
Guess it depends on the scale of the operation and how much investment you are talking.

Enough dealers are in still business to know that buying and selling does make money.

I think it is much harder for people to make true profit by running a project horse alongside their normal horse.
I did it for about 18 months and made enough money to get the deposit for my flat and pay for 1/2 my new car.
However, I stopped as soon as I had the flat as I couldn't afford to be left with something that failed the vet or didn't sell for some reason.

I know some other people make investment in young horses which they buy in on with pros and then sell after some prep or a season of competition- I've never had the money to buy that sort of horse but I do know a few people who have done it successfully.
 
In answer to your question, I think yes they can definitely be an investment, look at how much money horses like Valegro are now worth. That said I don't think many amateurs can do it!
 
In my whole adult life I have never lost as much money anywhere as on horses.

The only way you could do it is to find an undiscovered superstar for nominal money, produce it yourself and sell it for a vast sum which you will then lose again on your subsequent ' punts' that aren't successful.

Cynical aren't I but I would never in a million years advise someone to go into horses as an investment.
 
There are various ways to makes serious money from horses but you would need serious capital upfront for facilities. basicly the rich get richer.

Think Schockemohle!

There is money to be made from training racehorses where owners are paying decent training fees. E.g £300 plus a week on a yard of 200 horses. Thats £60K a week.

Buying and selling can work. Carl has built up his own yard from very little but he's had some incredibly good horses over the years that have paid him back. Eskie, Valegro and lots of upcoming international types which sell for £500K-£1m. However you have to wait until the right owners come along for these types of sales which can take years and you have to be a mega talented rider.

The other option is mass buying and selling like a lot of dealers and some higher end ones a bit like Oliver townend, Carron Nicol etc They will sell 100 plus horses a year often very quickly to keep costs down and have less emotional attachment to the horses.

If you think about what you spend on your horses in the last year or two you will find that you have probably spent enough money to get a house deposit. Which makes me think I shoud have got the houses then the horses!
 
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Good points made above. We source and produce a small number of irish horses and to that extent we are investing in them but I manage our expectations and, crucially, have a full time job outwith horses which pays the bills and liveries which helps toward running costs. Our approach is only to buy horses who we'd be happy to keep, and to enjoy them while they are with us so there is no pressure to sell them until they find the right homes. Frankly, I wouldn't want to do it as our means of earning a living as the pressure would be huge and volume would need to be such that I could no longer have the in depth knowledge of each horse or hand pick them. As others have said some people do make a living doing that in volume but to maintain standards and quality I think you need other income streams to keep going for the long haul.
 
popsdosh said:
Buy shares in Findus!!!!
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**Splutter**

In answer to the OP - many peole make a good living out of horses, so yes they can obviously be an investment. But they are high risk investment and you'll loose on many and gain big on some. So for those making a good living it has to be a numbers game.

From my perspective - I loose shed loads of money on any horse I buy with the intention of keeping for me. Thousands. It's a mugs sport!!!

However I've done a couple of buy to sell's and on both occassions have come out in profit. I was very strict in terms of only keeping them for the summer, having them living out and having a strict keep budget. I got lucky with one (I had fears I was going to end up loosing money on it at one point), but learnt from that and chose my next one very carefully and sold to an easier market.
 
A friend does it in a small way but she is very very specific as only looking for event horses she can produce on and then sell with the beginnings of a good competition record. She tends to buy good but green youngsters. Her investment is in the training and keep and it doesn't alway go to plan. She lost a good youngster in an unexpected field accident so you need to bear that in mind.
 
I used to do it on a very small scale, tbh though, including my time I would have done better, & taken less risks, working minimum wage. I was basically buying at low end sales, or local rejects, & the market at the time was good. Only two made massive profits, & they were pure luck & big gambles, & not something you could bank on happening.
 
I bought a 2yr old dressage horse for myself, direct from the breeder, very cheaply. At 3.5yrs, just backed, a professional saw him by chance and offered me 5 times what I'd paid for him (he is an amazing mover). I decided I couldn't turn down the money, so agreed to sell.

All my professional horsey friends couldn't believe my luck/my amazing eye for a horse etc. etc. I was feeling pretty smug!

Horse failed the vetting on a flexion test...

Moral of the story being, horses are a gamble not an investment!
 
You can make money with horses but they are not an investment unless you are talking numbers.
 
I have made my living with horses for over 30 years. I have been a breeder, trainer, instructor, sold horses, bought horses for other people, and only now can I really say that horses are a profitable business proposition - I use horses for display, film and TV work. I don't sell them - ever - but I do hire them out alongside all the other aspects of our business. It works because it is a symbiosis, not because of the horses per se. Are they an investement; definately. Does this relate to the rest of the horse "industry"; not really.
 
Cortez, I would say my experience has been similar. I've been able to support myself in the industry but never by 'investing' in horses themselves per se. The one really profitable business I've worked for was a huge concern, big enough to absorb the losses and completely focussed on profit. It was run by people who were established horsemen but had also worked prominently outside the industry and even then, the business really existed to 'protect' an enormous chunk of land slated for rezoning. As soon as that was on the horizon they put it on the market. Comically, it was bought by a wealthy couple to run their own business out of but they've pretty much run it into the ground and now, of course, the peak in the market has long passed!

Almost everyone I know who 'makes money' in the horse industry is heavily subsidised in some way, even if it's only by something like using a family property with a seriously advantageous mortgage/rent.

If people make a lot of money on a single horse it's almost always with a good dose of luck involved. Otherwise it's essentially gambling, which is fine, so long as you recognise that's what you're doing, manage your margins, and don't bet too much against the house.
 
TarrSteps said:
Almost everyone I know who 'makes money' in the horse industry is heavily subsidised in some way, even if it's only by something like using a family property with a seriously advantageous mortgage/rent.
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This, in a nutshell, which is why I work away from horses as well and it removes any pressure, giving the luxury of choice in decision making.
 
measles said:
This, in a nutshell, which is why I work away from horses as well and it removes any pressure, giving the luxury of choice in decision making.
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I really do think this is a "dirty little secret" of the industry. I am in a beneficial position now as my OH is well employed so I can have a much more relaxed attitude. But when I was on my own working in horses the trade off was I simply could not have one of my own and there is no way I would have "invested" in a horse because my margins were so small I could not have afforded to lose. I did sometimes invest my time in a horse someone else owned (usually one they'd bred) because I couldn't afford to buy and they couldn't afford to produce but, by both of us "paying upfront" we could make a saleable horse and collect when it sold. Even then, we had to assume a certain number would not work out and in that case we would both lose our "investment".

I have, btw, been involved in deals where horses sold for the sort of money usually reserved for houses. In EVERY case there was a lot of skill, hard work, and planning involved . . .and a big dose of luck. And usually a selection of other horses with similar invested in them that did not bring anything like the return. One thing successful people do is cut their losses. Fast. They don't get attached, they don't get delusional, and, when they decide they are done with a horse, they are done. EVERY such person I've worked for has let horses go for no money (or pursued even more permanent solutions) just to get them of the feed chart. They are not cruel, they are businesslike. This is an aspect of the business many amateurs struggle to accept . . .and what probably makes the difference between them! (Btw, I know pros who are super businesslike about their "business horses" and yet still have a "pet horse" they see completely differently, often pouring their own money into it in the same way any other owner would. People are funny!)
 
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Agree with both tarrsteps points. I do, & always will see horses as individuals, not business, & as a pt hobby, I could afford to be fussy about selling on, it was my competing budget, not my livelihood. I couldn't handle doing it any other way myself.
Plus the two that were easy money, with large % profit, were luck, right place, right time, certainly not the norm.
 
I will also add that part of my reason for not having horses of my own to buy and sell as part of my business is because I am too soft. Know thyself, as they say. I love fixing problems and would struggle to "quit" with a horse, almost on principle, which would be bad business. I can sell other people's horses all day long, as I see that as solving their problem (how to move the horse on) and helping the horse (by moving it on the best possible way). If I love the horse or not, it makes no difference. But if I loved one I had to sell, I know I would struggle. :)
 
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