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Old 16-05-2012, 14:55   #76
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Re: Yachtworld Asking Prices VS Actual Sale Price - or What is the Markup ?

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A fair deal is when neither buyer nor seller are happy.
Or when both are happy.
BTW, I lived up in Newburgh during the 1970's. Back then, it was pretty much a partying town. I still kid around and tell people that back then there was nothing you can do serious enough to get arrested in Newburgh. God, I miss that place.
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Old 16-05-2012, 15:18   #77
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Re: Yachtworld Asking Prices VS Actual Sale Price - or What is the Markup ?

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I am wondering whether half of asking price is actually too much.
With boats over 20 years old there can be information revealed that drives the seller to lower the price. Some fatal flaw that reveals itself through time and just sitting in the water that perhaps was overlooked or was not looked at. A survey done by a buyer that walked away rather then make a deal. The reasons can be limitless with any boat that isn't used regularly.

The real cost of the boat is after you buy it. You can run through $60K very quickly on any boat over 30 ft. If you just compare possible boats you are looking at and actually looked at you can estimate the cost difference in buying them and decide which is the more economical boat considering the extra money required after you buy it. When you take that approach the first offer is just about the same as the next offer corrected for the disparity.

Sellers and buyers come with all degrees of desires, sophistication, and knowledge.
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Old 25-05-2012, 14:15   #78
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Re: Yachtworld Asking Prices VS Actual Sale Price - or What is the Markup ?

Well, it would be possible to estimate the cost differences if you had some idea of the fair market value of a boat in average condition. This is hard information to come by. Soldboats appears to be stacked in the seller's favor very heavily. BUC seems to no longer have enough data to be reliable. NADA might be useful? But I suspect NADA and BUC are like blue book for cars where it has a higher value than I would buy for. If I was blue booking a car I wouldn't expect to pay much more than "trade-in" value, for example.

We are slowly increasing our budget as we look at more boats...but it's really hard to figure out what asking prices we should be looking at for the actual money we are willing to pay. For example, if we're willing to pay $40,000 purchase price, should we be looking at asking prices around $80k? $100k? More? That seems ridiculous but maybe that's just the way the boat market works?

I mean, comparing the boat market to the real estate market, it's like if I bought a house in 2006 for $200k, the market crashed, then in 2011 I put the house up for sale for $400-500k. People would laugh at someone who did that but it seems normal in the boat market.

As an example, I've always liked the looks of the Macgregor 65. There's a 1984 for sale in Everett, WA. Going by asking price it should be wayyyy out of our budget range at $120k. But the boat has been for sale for at least 2-3 years, probably more. Saw some posts about it here on this forum from 2010. MSRP when the boat was new was $120k, and no one pays full MSRP for anything. NADA market value is $50-55k. BUC is $90-100k which is double NADA. So, assuming the boat is in average condition with no major structural defects, what's a reasonable value for the boat? $40k or less (slightly below NADA)? $90k (BUC)? That's a pretty incredible range to deal with.

I understand the idea of making a really low offer and being prepared to walk away, but hard to even tell what price range to look at, which makes it hard to plan things. We aren't ready to buy quite yet and depending on how much boat we can afford it could change our plans quite a bit.
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Old 25-05-2012, 14:25   #79
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Re: Yachtworld Asking Prices VS Actual Sale Price - or What is the Markup ?

jim21, why do you say ...

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Soldboats appears to be stacked in the seller's favor very heavily.
Since it just reports what boats actually sold for it seems like a good guide to me.
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Old 25-05-2012, 14:35   #80
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Re: Yachtworld Asking Prices VS Actual Sale Price - or What is the Markup ?

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jim21, why do you say ...



Since it just reports what boats actually sold for it seems like a good guide to me.
From the research I have done the consensus seems to be that many brokers did not/do not report accurate sale prices, either just putting the asking price as the sold price or inflating the sold price. It's based on the honor system and from my experience yacht brokers are not the best candidates for such a system on the whole. If you had to provide documentation of the sale price I would trust it a lot more.

At one point it was very easy to get access to and I was not really impressed with it. Better than nothing but not much better. That was several years ago and supposedly it is getting better but who knows? And who really trusts a system where the data is inputted by those who benefit from entering higher sale prices?

Now if there was some system that collected data based on sales tax payments when title was transferred or something like that...that would be something potentially very useful...but not aware of any such system.
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Old 25-05-2012, 14:43   #81
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Re: Yachtworld Asking Prices VS Actual Sale Price - or What is the Markup ?

I'll say again that in my experience 25-30% off asking is a good general rule of thumb. One strategy I've used successfully with both houses and boats is to tell the broker "I like this one but the price is too high. What will it take to get the deal done?" A broker who catches a whiff of his commission is more likely to work with the seller to make the item affordable.

Also, brokers and sellers will cringe, but if you really like a boat after seeing it a few times, try to arrange a survey before you make an offer, not after-- and NOT with a surveyor recommended by the broker. The surveyor is on your side (the broker isn't) and will likely give you a mnore realistic appraisal of the boat's worth. A good surveyor will also uncover any significant issues and give you an estimate of how much they will cost to fix.
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Old 25-05-2012, 15:24   #82
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Re: Yachtworld Asking Prices VS Actual Sale Price - or What is the Markup ?

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I'll say again that in my experience 25-30% off asking is a good general rule of thumb.
I've heard anything from 25-50% off is fair. That's a big range.

Looking again at the above boat, 1984 Macgregor 65, and assuming average condition with no major defects, let's see...

Asking price is $120k
NADA suggested asking price (based on original MSRP) is $120k
30% off asking price is $84k
50% off asking is $60k
NADA market value is $45-50k

So if the seller is basing his/her asking price on NADA suggested asking price, which is the same as the actual asking price so it seems possible, if you offered 30% less than asking you would probably be getting screwed? Even offering 50% of asking you might be getting screwed (but less so)?

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One strategy I've used successfully with both houses and boats is to tell the broker "I like this one but the price is too high. What will it take to get the deal done?" A broker who catches a whiff of his commission is more likely to work with the seller to make the item affordable.
If I was a broker and you asked me that question I would give you a price that was higher than the lowest price the seller would take.

Now if you REALLY wanted the boat, that might be OK, as you are willing to pay more to get a specific boat and you don't want to lose any deal by offering too low of a value.

But if you are looking at many boats and trying to get the best deal that strategy seems extremely unlikely to get the best deal. Perhaps asking that question then knocking 10-20% off whatever the broker says?
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Old 25-05-2012, 16:00   #83
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Re: Yachtworld Asking Prices VS Actual Sale Price - or What is the Markup ?

Just like an anchor thread....

I've seen gems worth far above Blue Book. I've seen boats sink at their slips. It's nothing like buying a car.
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Old 25-05-2012, 16:09   #84
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Re: Yachtworld Asking Prices VS Actual Sale Price - or What is the Markup ?

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Perhaps asking that question then knocking 10-20% off whatever the broker says?
Of course. But that gives you an idea of what the broker thinks the seller will take without a fuss.

Again, 25-30% is a general rule of thumb. There are exceptions both ways, but 50% off is a little insulting. If you really think the boat is only worth half of asking...find another boat, because the purchase negotiation is likely to be unsatisfying.

Try to find an estate sale. The executor probably doesn't have an emotional attachment to the boat. Many estate sales tend to be fire sales.
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Old 25-05-2012, 17:08   #85
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Re: Yachtworld Asking Prices VS Actual Sale Price - or What is the Markup ?

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Of course. But that gives you an idea of what the broker thinks the seller will take without a fuss.

Again, 25-30% is a general rule of thumb. There are exceptions both ways, but 50% off is a little insulting. If you really think the boat is only worth half of asking...find another boat, because the purchase negotiation is likely to be unsatisfying.

Try to find an estate sale. The executor probably doesn't have an emotional attachment to the boat. Many estate sales tend to be fire sales.
I was checking out a boat about a month ago...listing price was $24k. Within about 30 minutes the broker had said that the owner had actually come in wanting to list the boat for around $16k and he'd probably take $12k. This was without me pushing at all or even making an offer. Which really has me wondering. We also looked at a boat listed for $42.5k that was maybe worth $15-20k at most and had reportedly had several dozen people look at it with no offers.

It seems like in this area at least there's a group of brokers who snatch up the estate sales and repos then re-sell the boats.
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Old 05-08-2012, 20:47   #86
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Re: Yachtworld Asking Prices VS Actual Sale Price - or What is the Markup ?

Lots of good opinions and advice on this thread. I'm currently in the market for a 37'-45' CC sloop and going through a similar exercise of trying to determine the 'right' starting offer. I'm also curious in what order to do things: offer, survey, sea trail. I've seen one post that said get a survey before making an offer. That same post suggested that you should see the boat first. However, all the boats I'm considering are at least 500 miles away. Seeing them all (with associated travel costs), then paying for surveys on 1 or 2 before making an initial pitch could become very expensive. I've been thinking I should go through a reverse sequence:

1. Decide on 1 or 2 boats I like
2. Make a 'test the waters' offer on my favorite boat - on the low side but stipulating that I would not pursue the purchase if the seller won't come down substantially from their asking price. If the seller/broker seems flexible then...
3. Make arrangements to have the boat surveyed. If the survey comes back reasonable then...
4. Arrange to see the boat and take it on a sea trial
5. If the sea trial proves to be to my liking, take the negotiations further

Thoughts on going about it this way?
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Old 06-08-2012, 04:19   #87
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Re: Yachtworld Asking Prices VS Actual Sale Price - or What is the Markup ?

The order of things are as follows:

Offer - signed contract to purchase at a price subject to survey with a deposit put in escrow. This is an always thing not a negotiated thing. Seller accepts or rejects.

Survey - hire a surveyor at $ / ft let them quit early if the survey is going badly to save money and then walk away.

Sea Trial - expect to spend the better part of a day and it usually is the same day as the survey.

Closing - conditions of the contract to purchase having been met you walk with a deposited refunded or you pay. If there are big surprises in the survey I would walk away not renegotiate. I wouldn't buy a boat that had serious issues enough to give be a second thought. There are always more that the survey won't find no matter what you buy. Look at it as an all or nothing operation once you write the offer. You may want little things fixed but only little stuff. and you don't open up negotiations all over again. It only proves you don't know what you are doing.

You don't waste your money on the last two steps until you have an offer accepted. No owner will let you survey or sea trail without a signed offer to purchase. You can examine or walk through but you generally don't get to operate the boat yourself until you close.

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2. Make a 'test the waters' offer on my favorite boat - on the low side but stipulating that I would not pursue the purchase if the seller won't come down substantially from their asking price.
Just make an offer you are willing to pay. I would laugh at your offer no matter what it was. The key is to figure out what the boat is worth and what you are willing to pay then just offer it. You need to act like a serious buyer that knows what they are doing or who in their right mind would do business with you. Telling a seller they have to come down in price before you ever saw the boat is a joke.

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5. If the sea trial proves to be to my liking, take the negotiations further
Every boat I ever bought or sold was on a firm offer subject to survey. The concept is I will close on the contract to purchase if the survey is acceptable to me or the buyer. I would never negotiate after the survey. I would probably walk away as a buyer or send the buyer packing. Your strategy only works with a boat no one in their right mind would buy. You need to make offers on really good boats that fit your needs and know what they are worth. These are boats other people would pay money for. Why would you want anything else?

You will easily invest $3000 if not more in the process of survey and sea trial. Add any costs because it is far away then if you close double it all so you can close on the boat and get it ready to move some place plus any actual work done to the boat so you can actually do it safe.

Do the home work before the offer and offer what you mean to offer is your strogest negotiation position. You need to look like a serious buyer and not a tire kicker. You start the process by knowing before you offer. Compare alternatives to find out which boats are better or worse than the one you want. Negotiate from a position of knowing rather than acting like a jerk. As a buyer you need to look serious or no seller will negotiate with you. I sure wouldn't. I tore up a full price offer from a buyer that never saw the boat and was far away. The odds of such an offer closing would be slim to none. Sellers want offers that will close even if it isn't what they are asking.

For the type of boat you want a long distance offer isn't probably a good idea. It may be fine for expensive larger boats where you spend a lot on surveys and hire professionals to be there for you.

You need to spend the time and do the homework before you offer on any boat. It's what people that have to work for a living have to do. If you have a tremendous wealth you can hire someone at even greater cost to beat up the seller for you. There is no better strategy than knowing! It means you need to do the work.
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Old 06-08-2012, 04:43   #88
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Re: Yachtworld Asking Prices VS Actual Sale Price - or What is the Markup ?

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Originally Posted by FruiVita View Post
Lots of good opinions and advice on this thread. I'm currently in the market for a 37'-45' CC sloop and going through a similar exercise of trying to determine the 'right' starting offer. I'm also curious in what order to do things: offer, survey, sea trail. I've seen one post that said get a survey before making an offer. That same post suggested that you should see the boat first. However, all the boats I'm considering are at least 500 miles away. Seeing them all (with associated travel costs), then paying for surveys on 1 or 2 before making an initial pitch could become very expensive. I've been thinking I should go through a reverse sequence:

1. Decide on 1 or 2 boats I like
2. Make a 'test the waters' offer on my favorite boat - on the low side but stipulating that I would not pursue the purchase if the seller won't come down substantially from their asking price. If the seller/broker seems flexible then...
3. Make arrangements to have the boat surveyed. If the survey comes back reasonable then...
4. Arrange to see the boat and take it on a sea trial
5. If the sea trial proves to be to my liking, take the negotiations further

Thoughts on going about it this way?
This is indeed backwards mostly. I'm guessing you haven't done much shopping yet other than on the internet. I've bought a few boats over the years and the procedures is very well explained above by Pblais below. I would suggest his approach.
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Old 06-08-2012, 06:37   #89
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Re: Yachtworld Asking Prices VS Actual Sale Price - or What is the Markup ?

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Every boat I ever bought or sold was on a firm offer subject to survey.
Same here, BUT...

In one case the survey turned up a serious issue that the owner did not know about, and that was not apparent on my initial inspection. As a result, the boat simply was not worth what either I or the owner thought. I calculated the cost to fix the issue, reduced my "firm offer" by that amount, and made another offer to the owner. He accepted.

So, if the survey turns up something unexpected, it is perfectly reasonable to renegotiate at that point--even though the offer you made BEFORE the survey was intended as a "firm" offer.
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Old 06-08-2012, 10:17   #90
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Re: Yachtworld Asking Prices VS Actual Sale Price - or What is the Markup ?

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Originally Posted by FruiVita View Post
I've been thinking I should go through a reverse sequence:

1. Decide on 1 or 2 boats I like
2. Make a 'test the waters' offer on my favorite boat - on the low side but stipulating that I would not pursue the purchase if the seller won't come down substantially from their asking price. If the seller/broker seems flexible then...
3. Make arrangements to have the boat surveyed. If the survey comes back reasonable then...
4. Arrange to see the boat and take it on a sea trial
5. If the sea trial proves to be to my liking, take the negotiations further

Thoughts on going about it this way?
The previous comments do have validity...but nonetheless you can do WTF you want Your Money = your rules .

The caveat being that (as evidenced by the previous comments) some Vendors / Brokers won't play ball with your intended approach (for both genuinely sensible reasons or simplly because they get confused by stuff being different to what they think is "Normal" - in some parts of the world they do have some very strange Broker driven "normal").......but my attitude would be f#ck 'em If they don't want to sell to you - that's not your problem.

FWIW (very little - see previous comments ) your suggested approach is in the ballpark, especially when you explain the reason for it. You will be out of pocket on a few Surveys, but overall likely to save on Travel costs (especially if you include your own time).

Personally I would chop my own right arm off to have a prospective buyer pay good money to look at my boat .......especially if I could snaffle a copy of the Survey Report (for future marketing purposes - if the deal does not progress).

The big risk to you is that the boat is great, you are happy with the (ballpark) price - but because not yet under contract gets sold from under you. But that is your risk, not the Vendors.
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