"Debt. High levels of debt is what killed the whole idea of being local. Having promotions people, etcetera.
Easy to get $$$. It caused prices to skyrocket (just like in the housing industry)."
I'm interested in buying a station, do I just wait for prices to come down (if ever)? I really can't see another way to make the numbers work. I can't pay cash at current levels.
I am getting the feeling that prices have about reached the new "floor", maybe basement is a better word. I don't see them rising, in the immediate future, either. They will hover at current levels until some more inventory is sucked up and a few more licenses get turned in. There are plenty of owners who would like to check out. The big problem for these guys is that they are cash flowing but, they cannot sell for a decent multiple. Its a good problem to have, in a way. Bottom line is, if there is no immediate need to sell and your making money, you may as well keep it.
Here is an interesting development. My FCC attorney mentioned to me the other day that the new "Stick Value" on an AM is roughly 65 cents per head, 12+, within the stations 2 MV/M. FM's used to go for 3 to 5 bucks per head, within the 60 DBU.
Currently, that figure is down to under 3 bucks. Now, if the station is really profitable OR you're dealing with major properties as in the recent Bonneville pickup, the deal will be much different.
Short story, Biz, is if you can finagle the cash or get a seller to hold the paper, now may be your best chance to buy. PM me if you wish and we can talk. I am a broadcast broker, BTW.