How much is a horse worth? H&H investigates… *H&H Plus*

  • In our horses for sale special issue of the magazine, we speak to agents, producers and other equine sellers to find out how they decide what a horse is worth when putting it up for sale...

    When it comes to putting a price on a good horse, where do you start? Whether you’re looking for the next Milton or want to enjoy the journey of seeing a super-smart youngster progress from pre-training to Cheltenham, how do those in the business calculate the value of those animals?

    “A horse is only worth what somebody is willing to pay,” says leading event horse agent Rachel Wakefield of Uptown Eventing. “There is no true value of a horse. It is like a painting or a house — it is guided by what is on the market at the time. Market value is determined by what a seller believes is an achievable price and what a buyer is prepared to pay, usually after some negotiation.

    “We have lots of factors to consider: age, experience, competition results, breeding, the producer, associated production methods, skills and costs, as well as veterinary history.

    “There are hundreds of horses priced around £5,000-10,000, but very few at top level, and that is what makes them exclusive and expensive. The market is like a Christmas tree — there are only a few stars at the top, but an awful lot of baubles lower down.

    “A top-class horse will just have something about him. It stands out a mile to me — whether that is presence, ability, movement, jump or how the horse goes across country.”

    For young horses, people pay a lot for potential. For example, a nice prospect for the Le Lion d’Angers young horse eventing championships would attract a high price, as historically they reach the top of the sport and are a good investment.

    “A big proportion of eventers at the moment are between £50,000 and £150,000, and that is anything from a novice to a five-star horse,” adds Rachel. “Above that there are world, European and Olympic horse sales, where the price tag would be considerably more.”

    International bloodstock agent Hamish Macauley explains that in racing, price depends on what you are looking for and at which sale.

    “With the foals, yearlings and three-year-old stores — the unbroken racing prospects — the amount you will pay comes down to the individual. We are looking for an athlete. The pedigree is still important, but it comes second,” he says, adding that temperament and soundness are vital.

    “However, if you are looking for mares or fillies with a view to breeding, a lot comes down to pedigree.”

    Select sales have the added value of the animals being accepted or chosen especially for that auction by experts. But as with any market, it comes down to supply and demand.

    “For store horses, people tend to be after a big, scopey, good-looking, sound individual,” says Hamish. “The difference between one making £60,000 and one making £100,000 may come down to the way they move — it is basically about how much someone is willing to pay for that horse.”

    Leading dressage horse agent Peter Tomlinson of Find A Dressage Horse agrees it comes back to supply and demand.

    “If the demand is high, the price is high,” he says, explaining that the impact the 2009 recession had on breeding is still being felt in the market today. “Even the big-money horses are going for bigger and bigger prices because there is a lack of them on the global market.”

    He adds that the majority of a horse’s price is linked to trainability, talent and temperament, and the Continental market is so strong because their breeding system is “around 100 years ahead of ours”.

    “You can get something that doesn’t have the strongest breeding and it could be the next Valegro,” he counters. “Breeding is a good back-up to have — particularly the damline — and there is a higher possibility that it is going to be good, but you cannot stereotype.

    “Trainability and attitude is where I would start. There is no point in having flash if you haven’t got the brain. A good brain is worth a fortune. They must have ability to move through the body, you have to be able to see the muscles working, and the behind is more important than the front end. You can always develop a trot; the main thing you look for is a good walk and canter.”

    ‘It is a business’

    Vere Phillipps, a dealer, producer and breeder, believes that horse prices have not inflated.

    “In 1968, my father bought a new Land Rover for £670 and in those days you could buy a hunter at Leicester sales for the same,” he says. “If you think what a Land Rover costs you now, and what a hunter costs, hunters are cheap. Nice horses are actually cheap — you would struggle to sell a master’s horse for more than £20,000, yet a good Land Rover is £30,000-plus.”

    When it comes to breeding, buying and selling commercially, Vere says the value can be calculated from what it has cost to produce a horse to that point.

    “You have to value a horse like any product, and as much as we all love them, it is a business,” he says, adding that an average  five-year-old with a clean bill of health costs the bones of £10,000 to produce.

    “It costs me £5,000 to get a foal to hit the ground. Say we are going for a sport horse — you start with a good stallion, the stud fee is likely to be £1,000-2,000, then by the time you’ve kept the mare and paid her stud costs, you are just delighted to have a live foal.

    “If you add up the costs associated to get him to four years old and do a professional job of starting him, taking him to shows, hunting, then a smart horse with potential that makes £30,000 as a five-year-old is not expensive.

    “With soaring overheads, if these prices are not achievable, professionals will stop breeding and producing these top competition horses. Then we’ll be left with hobby breeders doing it solely for the love of it.”

    Vere adds that the higher prices come in after that when a horse starts to show form, as this also comes at a cost to the producer.

    “When a horse reaches the next level in his career — say he is an eight-year-old advanced horse, fit and sound, and is still looking as if he will reach the top level — a lot of people will want him,” he explains. “If you don’t want to sell, but they want to buy, that’s when the higher figures come in.”

    Vere explains that this is higher still in showjumping as the horse’s potential earnings are higher than eventing.

    “That is a horse who could bring someone a lot of revenue for the rest of their career in terms of winnings, stud fees, sponsors, prestige and demand for lessons from the rider — that’s when you see the seven- or eight-year-olds going for £1m,” he says.

    A horse’s attitude to life and jumping is vital for producer Heidi Woodhead of DHI Event Horses.

    “I am quite fussy about conformation,” she says, adding that soundness and a clean bill of health are essential.

    “I’m interested in the bloodlines — we have bloodlines that have been very successful for us and although I don’t choose to buy a horse based just on that, when I look at the papers after I’ve decided I quite like one, I’ll think, ‘Oh brilliant’.”

    Heidi adds that the variation in price among young horses comes down to experience and the feeling they give her.

    “When the horses arrive here, I like to have them for a little while to play with and there’s something about one or two that makes you think, ‘Oh my goodness, this is going to be some horse,’” she says. “He might take time to produce as he might be sharper, or have a big frame with a weak body.

    “When we are selling horses, I envisage where that horse will be in two years’ time with the right background, set-up and support behind him.”

    The key ingredients

    Goffs director of sales, Sir Nicholas Nugent, believes a horse’s value comes down to a mix of factors — pedigree, looks, conformation and athleticism.

    “It is like asking what the key ingredient is in a cooked breakfast — the eggs, the sausage or the bacon. They are all central to the overall value,” he says. “Wherever you are in the world, the maximum value of a racehorse is defined by his pedigree. Where he sits within that maximum value is defined by how he looks.”

    He adds, for example, that a magnificent Galileo colt with no flaws, out of a strong damline, is where you will see Flat horses selling for seven figure sums.

    “If that exceptionally good-looking horse is by a much less fashionable stallion, its ceiling is probably €100,000 (£92,600). If he is out of a poor broodmare, however nice the horse is, the value will be limited — and will be lower still if he isn’t good-looking,” he says.

    “I always check the pedigree updates at a sale. Often the time between the catalogue going for publication and the date of the sale can be three weeks, so a lot can change.”

    For Nicholas, the excitement comes when you have a horse whose pedigree has improved, as they can fetch good prices in relation to their production costs. Pedigrees improve when other progeny by the same sire run well, so those bloodlines are in demand.

    “What you are hoping to do is to sell a horse for what looks like a lot of money, and if it goes on to do very well then suddenly it seems that it was not so much money.

    “When you sell your own horse, the overwhelming emotion is of relief. But when you see somebody get a great result, there is an enormous pleasure in that. It is a bit like driving the taxi when the couple in the back get engaged — you are at the centre of what is going on, but not actually playing a leading role.”

    The sales-toppers who set new records

    H&H looks back at a snapshot of horses who have caused a buzz at sales in recent years across the disciplines:

    • £6.3m Marsha: the double Group One winner became the highest-priced horse ever sold at a European auction when she was snapped up by Coolmore’s MV Magnier for 6m guineas (£6.3m) at Tattersalls’ December Mare Sale in 2017.
    • £1.84m VivinoL this two-year-old stallion by Vivaldi made history at the Hanoverian licensing and stallion sale in Verden (October 2018), selling for €2.01m (£1.84m). Out of state premium mare Desiree, by Dancier, he was bought by the Schockemöhle-Helgstrand Dressage collaboration following a 20-minute bidding war with Norway’s Kristin Andresen.
    • £1.28m Dougie Douglas: the British Nations Cup team stalwart was sold by former rider and co-owner Holly Smith at Goresbridge Supreme Sale of Showjumpers to a US buyer in November 2015 for €1.4m (£1.28m). The Irish-bred gelding has continued his successful jumping career in the States under Katie Dinan.
    • £620,000 Inter connected: the five-year-old set a new world record as the highest-priced National Hunt horse in training sold at auction, when he was knocked down to Darren Yates and Philip Kirby at Goffs Spring Sale in May last year for £620,000. The son of Network fell on his first pointing start before winning his second, and finished second in his first race under Rules in March 2019.
    • £15,000 Unborn: an embryo out of Valegro’s full sister, Weidyfleur II, by the eight-year-old Hanoverian stallion Finest, was the top lot at the Anglo European Studbook and Brightwells’ elite foal auction in September 2018. The unborn foal sold for £15,000.

    Ref Horse & Hound; 13 February 2020