by Peter Frederiksen
reprinted from Yachting Magazine and Times Mirror Magazines
You never thought it would happen. The yacht of your dreams has just come on the market, the price is right and the seller is hot. The only thing standing in the way is your present boat.
You love the old girl, but you have to sell her to free up the cash to make the deal fly. How do you make it happen? We canvassed brokers, surveyors, buyers and sellers for their insights on how to make a boat attractive for a quick sale. Their responses will help you make the right moves when opportunity knocks on the saloon door. You can try to sell the boat yourself. But you'll quickly find that any extra money you planned to make by cutting out a broker will come the hard way. The most efficient way to move your boat fast is to place the sale in the hands of a pro.
How do you choose the right broker? Most reputable brokers are connected to a multiple listing network. Obviously, the more eyes that see your boat, the better. You can help your cause by hiring a central agent who specializes in your type of boat: sportfishing boats, or Bertrams, or wood sailboats.
I learned this when I was captain of a popular sportfishing boat that was going on the market. When the broker came aboard to inspect the vessel, he went straight for a hatch in the galley sole to eyeball part of the bulkhead in the bilge. From experience he knew this model frequently had stress cracks in this area. My boat had them, too, which was a surprise to me. Not to the broker, however.
The point is, this broker expected the engineroom to be immaculate and the cosmetics in good shape. What he needed to know, though, was the structural condition before weighing the validity of the owner's asking price, and he knew where to look to find it.
"It's easier for a seller to put his confidence in a broker who specializes in a niche. And it's warranted," says Mike Brown of the Marine Group of Palm Beach, Inc., Palm Beach Gardens, Fla. Brown's specialty is sportfishing boats.
"It's easy for me to do a market analysis of a 47 Davis, for example, because I know what's out there. I can check on the BUC network (a worldwide listing service) and find out what's sold recently and at what price. Once a price base has been established, I can start comparing the equipment and condition of a client's boat and evaluate it as to whether it's just average, real nice or anywhere in between."
Working with a specialist can pay off in more ways. Jim Payne is with Cannell, Payne and Page in Camden, Maine, a brokerage house that deals mostly with traditional (read wood) sail and powerboats. This not only means they know wooden boats, but people seeking wooden boats are likely to turn up here first in their search.
How do you find these guys? Ask around and check the brokerage pages in marine magazines. If you do some legwork up front you can shorten the time your boat is on the market.
A little grease can help the wheels turn too. "If you are in a rush to sell, consider offering a specific broker an extra 2 or 3 percent commission on top of the regular fee if the broker completes the sale within a set period," says Haywood May of the Hinckley Company in Southwest Harbor, Maine. That could be an attractive alternative to ponder should you want the boat out of your marina slip in three weeks.
How do you determine price? Once you find the right broker, you must then set a price for the boat. Price, of course, is the most critical element to executing a quick sale.
"The price sends a message to potential buyers about your seriousness in selling," says Allen Schiller of Alden Yacht Brokerage in Boston.
Sellers often mistakenly assume accessories add value to their boat. Appeal, perhaps, but value is another issue. Electronics, for example, retain little value after just two seasons. Like computers, as new models become available, the value and appeal of older units depreciates rapidly. Older gear may not be obsolete, but to advertise it as "new" is a potential turn-off to a picky buyer. The same applies to "custom" furnishings and details. Taste is subjective and there's no basis for assuming others will appreciate yours.
"Don't let the ego of the sailor run away with a high price," suggests Al Gundry of Interyacht, a brokerage firm based in Annapolis. Gundry recommends not listing the boat for more than 10 percent above the going rate for your make and model. That rate can be roughly determined by consulting the BUC book, which lists used-boat values, and checking advertisements. Your broker can guide you on this point. Ed Brennan, president of Brennan Boat Company and Marina, Inc., in Brick, N.J., which specializes in late-model Sea Rays, echoes this sentiment. "Anyone can tell you what you want to hear, but it's better for a broker to be honest about a boat's value. Otherwise, the boat's going to sit there for a long time."
Brown says, "We have had clients overrule our suggestion, insist on a high price and won't budge. A year later the boat is still on the market."
Mike Obolsky, vice-president of Intrepid Powerboats in Dania, Fla., has sold Bertram, Phoenix, Southern Cross and other powerboat lines in his long career.
"Almost always a seller thinks his boat is worth more than anything out there," he says. "Everyone has the best, but how many bests' can there be? You must choose your broker wisely and give him a central listing to make him work hard for you. This will mean he'll work with you to come up with a realistic price to sell the boat."
You also must avoid at all cost what Obolsky calls "pricing the boat a commission apart."
"Some guys look at prices and think that's what they want to get without leaving any money for the broker's fee. But a broker is entitled to his commission because he's showing the boat. He's promoting and advertising; he's working for the seller," Obolsky says. Translation: figure the commission into the selling price.
Trust is crucial in choosing the broker. "Pick a listing broker that you are comfortable with," says Schiller. "It should be a good working relationship, not adversarial, when you get into negotiations. Remember: if you pick the right broker, he is really working on your behalf and may sometimes be more realistic" in terms of setting the price.
"Go to someone who sees your boat as important to him. The guy that sells yachts isn't going to worry about moving your mid-size cruiser," says Obolsky.
Inflated asking prices often are the result of browsing ads and deciding if a 5-year-old Bonecraft is listed for $300,000, you can get $30,000 more because your boat is a year newer and has a Jacuzzi. If that were true, we'd all be in the brokerage business.
But remember: An ad shows the asking price, not the selling price. Once the boat sells, there's no mention or information on how much money the boat actually brought. Only the broker, seller and buyer will know this information, although your broker can likely find out for you.
Clearly, it is going to be harder to get results unless you believe in your broker. As May suggests, "Most anyone shopping for a used boat has looked at a lot. If there are three boats on the market and they are basically the same in condition, equipment and features, the boat at the lower end of the price scheme will be the one that goes first."
It may seem obvious, but make sure your boat is showing her best cosmetic face. That means she looks, smells and feels like a buyer's dream. Presentation is everything.
"Boats must be merchandised," says Obolsky. "They should look appetizing and show that they've been well-cared for."
Boats in Bristol condition generally sell faster. There are two main categories by which a buyer will judge your boat: cosmetics and mechanics.
Before listing your boat, consider these points:
Cosmetics All exterior surfaces must be clean and shine. Fiberglass and metal should sparkle. Don't forget the windows, and especially portlights and hatches. Mineral deposits on glass looks dingy.
Once the boat has been detailed, maintain weekly until sold.
Mechanical Capt. August Losso, a surveyor from Spring Lake, N.J., likes to see all systems in working order. "You'd be amazed at how many boat owners will continue to operate bilge pumps in manual mode after the auto-float switch quits. They don't care, but a buyer will. Everything has to work."
Repairs must be considered on an individual basis. If you know the bottom has blisters, for example, the surveyor is going to note the condition on his report. He may get an estimate from the yard that does the hauling and write it into his survey. In that case, you can expect the buyer to yank that amount off the top. "Buyers always round off numbers toward the high side," says Losso. If you are aware of an existing condition, it might be cheaper to have the work done on your own after collecting several estimates, and then put the boat up for sale. Similarly, if the engines have high hours, the buyer may anticipate a rebuild in the near future. He won't necessarily know what it will cost (without either tearing down the engine or getting a ballpark estimate from a mechanic, nor will the surveyor), but he won't be shy about offering substantially less money based on his concerns. It might make more sense financially to have the work done and offer the engines with zero hours. One way to find out would be to consult the BUC book for low/high prices. By getting the rebuild done at the right price, you might get double your money back.
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