Tips for Buying a Brokerage Boat
Used boat sales, or brokerage boats, make up the majority of the boats purchased in the US market. Despite that, buying a brokerage boat is still a commonly miss-understood process. Here are a few tips on how a first time or life time boat buyer can make the most of their buying process.
Tip 1 – Use a Buying Broker. Boat buyers often “google” search the type of boat they want and call the broker who has that boat listed. While this can be a safe and successful way to buy a boat, wouldn’t you want an impartial party helping represent you? The first question asked about buying brokers is “What does it cost me, the buyer?” Nothing! Buying brokers split the brokerage fee with the listing broker. A good buying broker will help define your search criteria, do the bulk of the searching and research, discuss the available options and help narrow in on the right boat for the buyer. Then the broker can set up a showing to walk through the best boats. Once the right boat has been found, the buying broker will handle price negotiations, draw up the paperwork, line-up the surveyor, and execute closing documents. Sounds like a lot of value doesn’t it?!
Tip 2 – Understanding Your Budget. One of the best ways to understand your budget is to talk to a marine lending organization and get pre-qualified. This helps you understand what the real ceiling on your boat search is before you even start. If you are planning to “pay cash” for your boat but can’t quite make the dollars add up to get to the boat of your dreams, consider doing a small loan or financing part of the purchase to help bridge the gap. Rates are still very favorable for most buyers which you can learn about in our Finance piece this month. Further to understanding your budget, is knowing what the re-sale value of your boat will look like a few years down the road should things change and you decide to move up, down, or onwards. One common mistake many buyers make is confusing the value of the boat with the cost of ownership. That is to say, If you can afford to buy the boat but then the cost of the slip, insurance, fuel, and maintenance tip the scales out of your favor, it means you’re buying budget should be adjusted.
Tip 3 – Understanding Compromise. Let’s face it, buying a boat new or used is a good fortune we are lucky to have. That does not mean it won’t come without some compromise. Interior volume vs. cockpit volume, speed vs. fuel economy, dockside comfort vs. on-the-water performance, aesthetics vs. maintenance, what you want vs. what your partner wants vs. what your family as a whole wants. These are just a few of the many compromises to consider when finding the right boat. Working with an experienced buying broker can help de-bunk many of the common concerns buyers have when weighing these options. The #1 goal of any boat buyer and their broker should be to find a boat that works great for you 80% of the time, and then find a way to make the last 20% of the time creatively work.
Tip 4 – Size Matters. Finding the right size boat for you and your family will often be dictated by your budget. From there, understanding who is primarily going to use the boat, dock it, and sleep on it should help you fine tune the size. Docking a boat can be intimidating to many and can cause you to err on the side of caution and go smaller. What if two years down the road you have mastered docking your boat but just don’t use it because it’s not big enough for you and your whole family? Keep in mind we all grow into things so sometimes keeping an eye towards the future and your boating goals can lead to buying a bigger boat being a wiser investment.
Tip 5 – Cast a Wide Net. If you are fortunate to live in a boating hub like the Chesapeake, New England, or Florida its often easy to just look in your back yard for the right boat. If you are working with a good broker, they can often reach out to other brokerage firms throughout the country to find that perfect fresh-water boat in the Great Lakes, as an example, that you might have not seen otherwise. The internet makes it easy to cast a wide net geographically but many brokers will have their ear to the ground and know of boats soon to come on the market, where that right deal can be found, or even what regions are best or net best to buy from. Don’t forget, if the right boat comes up, be prepared to make an appropriate offer to have the best chance at getting the boat. If the right boat isn’t available today, your broker can save a search so both of you are notified when the right boat hits the market and strike right away!
Tip 6 – Understanding a Survey. Brokers often have a lengthy list of Marine Surveyors to help aid you in the last phase of the buying process. Some surveyors will have a specialty and be the go-to for Down East powerboats or blue water cruising sailboats as an example. A survey of the boat you have chosen should include an out of the water inspection of the bottom, hull, and running gear, as well as an in the water inspection of the boats systems and a sea-trial. If the boat has an engine that you are unfamiliar with or one you wish to have a specialist inspect, it is not uncommon to have a separate engine survey done as well. The key to understanding a survey is to expect findings, and work with your broker andsurveyor to understand them. A good survey will state the findings and not make a “mountain out of a mole-hill.” From this point you can decide what you will ask of the seller to repair, make a price concession towards, or put on your own list to work on down the road. This can often be a stressful part of the buying process, but the key is being educated and transparent about the findings. From there an open dialogue should help towards a successful purchase!
Tip 7 – What to Expect Next. You have bought a boat! Hopefully you know where you plan to keep the boat, but your broker is a great resource for that and other things like insurance, tow memberships, maintenance plans, and more. At North Point Yacht Sales, we don’t think that our job is done when you have finalized your purchase. It is our hope to continue to build our relationship with you and help ensure that your time with your boat is as enjoyable as possible. We are here for calls night, noon, or weekend when the odd question or concern comes up. We treat all of our clients like friends and family, and if we are lucky we will have earned your trust to work together again in the future!
By: Grady Byus