Want to learn more about how a Professional Yacht Brokerage Can Help you buy a boat or sell your boat? Let us tell you!
How can a professional yacht broker help you when buying a boat? Check out this great article as featured on YachtWorld.com 3/18.
Yacht Brokers work like real estate agents. They are agents whom people consult to find and purchase a boat, and whom people hire to list, represent, and sell boats for them. Traditionally, the seller pays the commissions that a yacht broker earns – not the buyer, yet brokers have a duty to both buyer and seller in every transaction.
Boat Dealers represent new boat lines. They often take “trade-ins” to facilitate the sale of a new boat. Dealers advertise their trade-ins, often at very good buys. Some dealers will refurbish the boat before putting it on the market. Some dealers offer a pre-owned boat warranty program, similar to the automotive industry, particularly in smaller craft.
The broker’s role for the buyer
- Most pre-owned boats advertised on YachtWorld are either a “central agency listing” of a yacht broker, or a trade-in from a new boat dealer. If you are viewing a broker listing or a trade-in, the listing broker or dealer is likely to know the vessel inside and out. They have been selected by the owner/seller to exclusively represent this vessel (or the dealership may now own the vessel) and all inquiries must go through this yacht broker or boat dealer. If you are not already working with a yacht broker, and if you find a boat on YachtWorld of interest, you may contact the listing broker directly. However a more rewarding option might be to select a yacht broker of your own, and consult with that broker about all of your boats of interest, and let that broker represent you in your inquiries and transactions.
- The Initial Inquiry – A professional broker will listen closely to your wants and needs and will help you determine if the boat you are calling on is the right boat for you at the best value. They can objectively tell you about the condition of the vessel before you decide whether or not to spend your time to look at the boat. They will help you determine if there are similar boats on (and off) the market, the history of the yacht, how long it has been on the market, and the motivation of the seller. Anyone can look up asking prices on boats, but it takes a professional broker to have an intimate knowledge of current market conditions, a familiarity of similar boats, and information on recent sale prices and time on the market through www.soldboats.com, an industry resource not available to the public.
- Getting a Boat Loan and Marine Insurance – You may want to pre-qualify for a boat loan before you shop. That will give you some extra leverage and breathing room when you’re negotiating prices. YachtWorld offers a variety of specialist marine lenders.
- Making an Offer on a Pre-Owned Boat – A professional broker can help you decide on a realistic offer that increases the chances of buying a pre-owned boat for a fair and reasonable price, and with the necessary elements to protect your interests. Your broker prepares an Offer to Purchase for your signature. It should spell out the terms of the sale including obligations that you and the seller have agreed to, and when these obligations will be fulfilled. You also make a good-faith deposit on the boat, which is usually placed in escrow and subject to sea trial and survey.
- Making an Offer on a New Boat – Dealers taking trade-ins will inform you of tax issues and tax savings associated with the trade-in. Price negotiations may include making your new boat available to show to other dealership clients in the future. Depending on whether the vessel is custom built, semi-custom, or a production model, there is usually a basic cost, plus transportation expenses from the builder to the dealership, plus optional equipment and installation.
- Paperwork – Professional brokers and dealers are familiar with all the paper work requirements for their each country, state or province, from the initial Offer to Purchase and Bill of Sale to licensing and registration; or documentation and titling, to paying tax and other fees, as well as certificates of ownership, security agreements, and other documents needed to complete a sale. For example, 23 forms are needed at a closing of a brokerage boat in Florida (27 for foreign-flagged vessels). Professionals will understand maritime and admiralty liens for the type of vessels they represent, as well as agency contracts, listing agreements, closing statements, deposit requirements and escrowed accounts to safeguard funds.
- Sea Trial and Survey – The buyer of a pre-owned vessel will usually request a sea trial and the services of a marine surveyor. Buyers pay for the surveys and for hauling the boat out of the water for inspection. Your yacht broker will usually attend the sea trial and marine survey with you, and help you determine how to properly address the nearly inevitable yacht survey issues and put the problems in context. They can help estimate time and cost of correcting, and where to obtain accurate quotes for items that are unfamiliar. Your lender and insurance carrier will usually require a copy of the survey.
- The Art of Negotiating The Deal – The broker can use his position as a middleman to keep the negotiations between buyer and seller moving to a successful conclusion.
- Safeguard Funds – A professional broker will use an escrow account for clients’ funds, and ensure that at closing, any existing loan or other encumbrances is paid off. This safeguard is of critical importance to the buyer and seller, and can be a potentially serious hazard in a private transaction not involving a broker.
- After the Sale – Your broker and dealer can help you find moorage and yacht maintenance and repair specialists or facilities. They can refer you to classes on sailing, boat handling, and seamanship, their experience in local waters can help you chart a course for great day, weekend or longer trips. They can connect you with boat clubs, races and rendezvous sponsored by builders and dealerships. Plus, you’ve got a new boating friend for life.
Conversly, Professional Yacht Brokers are just as useful when selling your boat. Learn more from this great article also presented on YachtWorld.com 3/18.
If you’re ready to sell your boat or yacht, a key decision you’ll need to make is whether to sell it yourself or through a yacht broker. Fundamentally, if you sell the boat yourself, you won’t need to pay a broker’s commission, but without assistance, it will often take you longer to sell the boat and you may have to settle for a lower price. Generally, sellers work with brokers more often when the boats are newer, larger, and/or more expensive, but there are many other reasons to list boats of all sizes and conditions with a broker.
Here at YachtWorld, listing with a broker is required for your boat to be shown for sale on our site, so we’d like to describe what the broker does to help you understand why using a broker is often the best way to sell your boat. We’ll also discuss how you can find the right broker to sell your boat.
Why use a yacht broker?
Selling a boat is similar to a real estate transaction—it’s usually too complex and involves too much value to risk doing it on your own. Yacht brokers work hard to facilitate the sale of their listings and to protect and promote the interest of their clients, just as a real estate agent will do when you sell your house.
Some countries (and US states like California and Florida) require licensing of their yacht sales professionals. Most brokers in the US and Canada prefer to sign a “Central Agency Listing” with the owner/seller, which is similar to a multiple listing in real estate transactions. Essentially, this means your broker will manage all of the communications and information flow about the listing between you, other brokers, and potential buyers.
Finding the right yacht broker is an essential part of the successful sale of your boat.
Along with the most obvious job of managing the communication and information flow, working with a broker provides a number of significant advantages. Brokers have a network of clients and may have a number of buyers in mind right from the start. They know the market well, especially in their specialized segment of it, and they have a solid understanding of how to properly price a boat or yacht.
Another advantage is that working with a broker gets you on the pages of YachtWorld. YachtWorld is the largest online photo and video database of new and used power and sailboats for sale, with well over 100,000 listings. And YachtWorld advertising services are only available to eligible yacht brokerage firms and dealerships who represent multiple boats for sale on behalf of owners/sellers. We do not offer our services directly to individual owners/sellers.
What will it cost to use a yacht broker?
Yacht brokers charge a commission when the vessel is sold, and the commission amount will be set in writing when the seller signs a listing agreement with the broker. If another broker brings a buyer to the table through a co-brokerage arrangement, the total commission will normally be shared between the brokers; it should not raise the commission. Many brokers work co-operatively with one another on a co-brokerage basis.
How do you find the right broker?
Choosing the right broker is an important step in selling your boat. Brokers often specialize in boat types, sizes, and geographic regions, so it’s usually best to choose a broker who already represents boats similar to yours, and who operates his or her business close to where your boat is located. Here are some ways to make sure you find the right broker to sell your boat:
- Interview several by phone, email, and in person
- View the presentation of their other listings on YachtWorld, and ask yourself: do those listings look like something I would be proud to show to potential buyers?
- Send the broker an email. Do they respond quickly?
- Call the brokerage. Is your call answered promptly?
What will a broker do for the seller?
Yacht brokers can make a sale go more smoothly right from the very beginning of the process. Here are some of the ways a broker will help you sell your boat:
- Determine a fair asking price – To ensure a timely sale, it is essential to ask a fair price. A broker can help establish fair-market value for the boat through access to actual sold boat data in www.soldboats.com, as reported by YachtWorld brokerage firms. Soldboats.com is not available to the public.
- Prepare an advertising strategy – The broker will outline a plan of how a boat is to be advertised in the most appropriate media. For example, the best means to promote a 27′ Catalina is vastly different than the strategy for a 63′ Sunseeker. The broker’s objective is to devise a strategy that has the best chance of reaching the most interested and qualified audience for your boat.
- Prepare the listing for the public – The broker will prepare the listing for distribution in various electronic and print media, for print and email distribution to clients and other brokers, and for distribution to prospects at boat shows, open houses, and walk-in inquiries. Sellers who have listed their boat for sale with a YachtWorld broker will see their listing advertised on YachtWorld, on the website of the YachtWorld broker, and in other partner sites selected by the broker.
- Prepare the listing for the broker-to-broker Multiple Listing Service – When you list your boat with a YachtWorld broker, your broker may also prepare the listing for co-brokerage using the private BoatWizard MLS. YachtWorld has over 2000 member brokerage firms, with 3000 offices and 5,000 individual yacht brokers and salespeople, all of who have password access to this MLS system.
- E-broker – YachtWorld members have multiple tools and services to help them promote your boat listing to buyers and other brokers.
- Follow YachtWorld Member Policies – YachtWorld member brokers are bound by our member policies. For example, members agree to only advertise boats for which they have a current signed listing agreement from the owner of the boat. While listing agreements vary, they should contain the same elements you would expect to find in any legal agreement. Our members agree not to accept an advertising fee to promote their listings on YachtWorld. Members agree to only identify a boat as a “Central or Exclusive Listing” if it complies with the YachtWorld definition of a central or exclusive listing. All advertised boats must be accurately represented and identified.
- Prepare the boat – The broker will advise you of any improvements that should be made to make your boat competitive in today’s market, identify possible problems and solutions, and help organize upgrades and repairs. The broker may help locate easy-access moorings or storage for the duration of the listing.
- Provide professional know-how – Professional brokers will understand the principals of the brokerage profession—things like certificates of ownership, security agreements, bills of sale, and other documents needed to register and transfer titles to boats. They will understand maritime and admiralty liens for the type of vessels they represent, as well as mortgaging and transferring title to documented vessels. They will understand agency contracts, listing agreements, closing statements, deposit requirements, and escrowed accounts to safeguard funds.
- Assist with the sea trial and survey – The buyer will usually request a sea trial and the services of a marine surveyor. Buyers pay for the surveys and for hauling the boat out of the water for inspection. Your yacht broker will usually attend the sea trial and marine survey and help you determine how any discovered deficiencies should be addressed in the purchase negotiations.
- Employ the art of negotiation – The broker can use his position as a middleman to keep the negotiating between buyer and seller moving toward a successful conclusion.