NADA vs. YachtWorld - Grrrrrrr

[xymotic]

Originally Posted by Auzzee

If you are selling, price your boat at what you think it is worth. There is little point in the 'start high' ethos. Once it's been advertised for several months with a regularly dropping price, seasoned boat seekers will give it a wide berth reasoning something must be wrong.

When starting at the price you think it is worth, don't then add the commission. That immediately makes it overpriced and puts the broker at a significant disadvantage. Ask the broker directly if he is confident selling the boat at the price you are asking.

When buying, don't try to thieve. Pay for a boat what you think it is worth. Putting in stupid offers brands you as a stupid person and no one likes to deal with an idiot. Also don't try to justify a stupid offer by telling the broker how much of a sh*t heap he is trying to sell. You're trying to buy the boat, so who looks like the idiot? The broker generally will be a boating pro with more miles under the keel than you.

Remember another dream boat is always for sale in the next marina. If you miss one deal, there will always be another and there is no need to become a nuisance by berating sellers and brokers.

Life is supposed to be funfilled and gratifying....for everyone!

There is a flip side to that. I looked at a Tayana 37 that was listed I think at 100k. it had a few issues, namely the chainplates. I offered them 70.

heard nothing.

A week later I called and the broker told me the offer was insulting and he said 'are you kidding, we have a much higher offer, quit wasting our time."

I then bought a boat 2000 miles away for 85k.

3 weeks later the broker called and said it failed the survey because of the chainplates and was I still interested.

Ahhhhh, that was a fun conversation.

[RELENTLESS 1]

I thoroughly understand the idea of being overly aggressive and undervaluing an asset. In my Investment Real Estate Broderage business, I fired many a client with unrealistic expectations. However there I had the benefit of many sales, similar properties, etc. to establish market value. With boats, as the thread so aptly pointed out, NADA and BUC are relatively useless, and I tried to talk to Soldboats. com but they told me I had to be a registered Boat Broker or Surveyor. So I have neither solid timely value information or true 'homogenous' comparables from which to figure a 'base' value for a given boat and then add or subtract for the variables of condition, equipment, etc.

Compounding this is several times I have contacted a Seller directly who sold his boat recently and asked them what they got for it and NONE of them were willing to be forthcoming on the value!? I am not eniterly surprised by the reticence, but it might be helpful if people were a little more forthcoming as it would help everyone involved Seller, Broker and Buyer.


Therefore from what i have gathered here and other places is that.
1. The market is soft and there are a glut of boats to be had
2. Boats are not always comparable, equipment, upgrades, conditon etc. make the variances of value very wide
3. We are not privy to the Survey which may or may not have raised issues that affected the ultimate price.
4. It appears from the thread and Brokers I have talked to that most deals are happening about 20-30% off list price, problem is was list price realistic to start with?

I am just trying to garner as many facts as possible, weigh the 'alternatives' or 'extras' in each boat and be able to feel I am making an informed offer not just a subjective gut feeling.

thanks again for the help

[David_Old_Jersey]

Originally Posted by Dawntreader2

I am just trying to garner as many facts as possible, weigh the 'alternatives' or 'extras' in each boat and be able to feel I am making an informed offer not just a subjective gut feeling.

thanks again for the help

You sound like you have a good handle on what needs to done (I mention only because not always the case with folks ). Unfortunately no real subsititute for someone doing the legwork themselves, visiting actual boats as well as simply internet. My "good to go" is someone else's "too much work" (and vice verce), and sometimes even for genuine reasons.

IIRC you are after a starter boat for only a few years, plusses and minuses to that approach. For me the big plus is that you start out with an eye on resale value.....at the risk of teaching my grandmother to suck eggs , what works for me is asking self "what price would I feel comfortable in selling at next week?" - doesn't mean I try and only buy at that price but at least gets me somewhat aware of how much my own "want it now" premium is .

In your shoes I would go for something with a brand name and decent build numbers (can always sell a Ford - plus lots of current / former owners around for advice on things to look carefully at, both before and after purchase) and if budget allows something in the 3 to 5 years of age.............Won't mean the boat is guaranteed to not have an idiot PO (or 3!), but odds are less and the consequences likely more survivable - plus do not get heavily into the 7 to 10 year refit costs and are simply looking at upgrades you choose to make. (bear in mind that pretty much any money you spend on her won't be coming back upon resale - so try and buy as near as good as you actually want (price up stuff / extras and add a WAG for installation costs, in time, money and aggro), just bear in mind no such thing as the perfect boat!).

But as said, no subsitute for self knowing WTF you are buying (and the costs involved to rectify errors in judgement) - Surveyors / Brokers / folks on internet! are only guides and none of them (us?!) will be writing the cheque for a booboo purchase .

Of course buying a boat ain't rocket science - plenty of threads on subject on CF.......

[Pblais]

Could you elaborate on why it will cost so much or is it that if I spend $50K on a boat it's easy to drop another $25-35K upgrading?

Some things expire from age. Anything canvas or fabric and that includes cockpit enclosures and sail covers as well as sails and upholstery. On a 45 ft boat that would be easily $25K for good stuff not crap. These things don't take infinite wear and so the day you buy it they may seem fine but in another 5 years they may not be so nice. If you will replace something sooner it means you enjoy it longer before the end of owning it comes. Putting off the inevitable costs more and you never get to enjoy it!

Ok now get into other things that can look fine but need work. This list includes anything mechanical. I'll be hauling tomorrow to deal with engine mounts and that will need to include shaft alignment and perhaps cutlass bearing. The boat operates fine enough but I know the shaft is not in good alignment because it leaks.

I have now re-bedded everything on the boat. Just the process of removal and replacement finds all sorts of ugly little things. These were not expensive material wise but took a long time to complete. The boat was built exceptionally well and with the exception of a couple years well maintained the whole time BUT age is age. At least we have solid construction to repair against. The better built hulls will give you that much but the crap attached to the boat is expensive make no mistake.

If you go back a page or so you see where I said if you have a list of boats negotiate for the best one in the list. The one we bought is that one and still the expenses are not over though I really think this year we got all the bad stuff that can be found and redid a lot of things better than new. Almost everything on a boat can have an issue eventually and they cost a lot to replace. Just the cost of the parts is alone a lot of money not including the extra hours. It's far cheaper to do a poor job installing this stuff too. So undoing bad work is something you may see a lot of too. It takes a lot of time to things things the really proper way. It's hard not easy.

If you think about it you really want the better boat. Given that idea buying the first boat to only sell soon isn't a good idea. I did that too. Not that we intended to and not because the first boat wasn't nice and we didn't like it either. It did get a lot of things done to it and the folks that bought it put in more too. we did want something bigger than a really big 33 ft. we now have a monsterous 36ft boat that compares to a lot of 40 ft boats. The biggest small boat that works is the point of good and affordable.

Boats don't age well and neglected boats are a warning sign that there is a LOT more hidden than you can hope to find in a survey. This would include all the boats you can low ball.

There can be a lot of good deals out there but there really are no steals to be had once you look deep enough under the covers.

[tookish1]

I just finished reading "How to Inexpensively & Safely Buy, Outfit and Sail a Small Vessel Around the World" by Fatty Goodlander.

There are some great ideas on how to negotiate with an owner positively, creat rapport and get the deal of a lifetime.

It's a needle in a haystack approach, but doable. I'd never want to negotiate with him!

The book is definitely worth a read IMHO.

Best of luck in your search!

[Kettlewell]

I have bought and sold seven cruising boats, and I'm on my eighth. In smaller and older boats, say 35 feet and under, it is very likely that a shrewd buyer will either break even or make money even if you sell after a few years. I always did so, mainly putting sweat equity in and not much in the way of money. You shouldn't be planning on spending a lot on this boat in the first place, so look for one with good genes, solid rig and sails, a decent working engine, and lots of cosmetic issues. The cosmetic issues make a huge difference in the price--the dirtier and the stinkier the better. If it is somehow awkward to deal with (maybe located well inland), another bargaining chip. There are a lot of lightly used older boats that are basically sound and can be had for a discount. Brokers aren't really interested in selling these, because there isn't much in it for them, so the best ones can often be found on bulletin boards in places like Annapolis, in local papers, on CL, maybe on eBay, and in other odd spots off the mainstream YachtWorld scene. Check out any free boating newspaper's classifieds. I found boats by just wandering likely boatyards looking for the weathered for sale sign with the phone number that is hard to read. Dealing with the owner directly further cuts the price--no broker commission.

[Auzzee]

Originally Posted by Kettlewell

cosmetic issues make a huge difference in the price--the dirtier and the stinkier the better.

After a lifetime of sailing as well as buying boats specifically to refit, then sell, I agree with the above. However, my experience is that people who allow a boat's cosmetics to deteriorate, will also allow the systems, rig, sails and donk to deteriorate.

[Kettlewell]

I agree with the above. However, my experience is that people who allow a boat's cosmetics to deteriorate, will also allow the systems, rig, sails and donk to deteriorate.

Not necessarily. Look at the all the boats that just sit in a marina or on land and never go anywhere. Leave them like that for a few years and they can get really dirty, but with almost no wear and tear on the important big systems. On the other hand, if someone leaves a leaky boat full of water, it can be a problem. I'm not saying that every dirty boat is a bargain, just that they are worth looking at if you want to save some money because cosmetics impact the price out of proportion to the impact on the quality of the vessel. My current boat has some sails that are more than 30 years old, but they were so rarely used by the previous owners that they are in pretty good shape.

[Richard5]

Originally Posted by xymotic

A week later I called and the broker told me the offer was insulting and he said 'are you kidding, we have a much higher offer, quit wasting our time."

Most likely that was a tactic to appeal your emotions to create negative aspect in your mind. Basically to cause you to question your position.

As Deep Frz said, this is a business transaction. Surely, there are some boats which are beautiful and sexy but bottom line is this is business. To those who are concerned with insulting the seller think of it this way; would you be insulted if the seller agreed to less than asking price? Would you be insulted when they demand higher than your offer?

The closest I would get to feeling insulted is paying full or near to asking then finding out some major work was required. In that case, I doubt most previous owners would be motivated to converse regarding my concerns.

[Jim Cate]

A comment on the "charter for a couple of years" rather than buying a learner boat issue:

IMO, chartering does very little to educate one on the serious issues that face the cruising sailor. All the "hard stuff" is done for you, and the consequences of any mistakes that you might make are borne by the combination of insurance and others labours.

Chartering is a reasonable way to sample other cruising venues if you have not the time, skills or experience to get there on your own. It does not provide the sort of education that one needs to select, outfit and voyage in your own boat.

There is no reason that you should take a big fiscal hit with the learner boat. The suggestion to buy a cosmetically challenged boat and tart it up can be both educational and possibly profitable, but just buying a nice, locally common boat and doing normal maintenance on her should keep you from fiscal disaster.

Buying the wrong "forever" boat is a far bigger fiscal risk IMO.

Cheers,

Jim

[shamrock]

Worrying about insulting a seller I think is a waste. Brokers as will real estate agents will warn against "alienating" a seller which is rediculous.

Getting a low ball offer is better than no offers as far as a seller is concerned.

In terms of value, especially on the lower end, there is such a large dispersion in prices and there should be as the cost of upgrading and repairs can be extrordinary.

You could buy a boat for 30K and spend 15k on a bottom job. You would have been better off spending 50 on a boat in great condition ready to go which might have seemed over priced when shopping around.

I think generally people underestimate the time and money is needed for any kind of project and would be better off spending more upfront, so using any kind of pricing benchmark could be dangerous.

[denverd0n]

Originally Posted by Jim Cate

IMO, chartering does very little to educate one on the serious issues that face the cruising sailor.

"Very little" is pretty subjective, but I guess I wouldn't disagree with this statement. What I would say, however, is that the little that it does educate one about are some of the major lifestyle adjustments that have to be made.

Can you sleep comfortably in a V-berth? How about when the wind is blowing and the boat is rolling? Can you deal with a tiny galley after your sumptuous kitchen at home? Same question concerning the head--even a "large" head on a boat is remarkably tiny compared to what you get in the average home.

These are some of the adjustments that people who have never spent time living on a boat have a very hard time even imagining, let alone being truly prepared for. These are the kinds of really important questions that you will be able to answer after spending time chartering.

As to insulting the buyer... My take is that any buyer who gets truly insulted by any offer is WAAAAY too emotionally tied to the boat for me to bother with. If they can't see that this is just a business deal, and just another negotiation, then I don't want to have to deal with all of the headaches that they are almost certain to cause as the deal progresses.

Having said that, I will admit to having feigned offense in the past, as a negotiating tool. Sometimes it is the buyer who can't understand that it is just a business deal, and a seller who recognizes that can play the emotion card to their own advantage. It cuts both ways.

[RELENTLESS 1]

I am liking what I am reading here and it has really helped me define my parameters. I am still between older Sabre, Ericson, Tartan and a Catalina/Bene/Jenn that is 10-15 years newer but at a similar price level (I am thinking sub $50K) all in meaning my upgrades or existing levels of comparable Electronics, Condition, Sails, Eng. Hours, etc. . There was a another subject thread of "Older Sabre vs Newer Catalina" and hands down Sabre was the preferred boat to own. But which would be the preferred boat to sell 3 years hence?

Another thing about the Charter/Club thing is I am in full agreement that this route does little to help my learning curve in the areas of maintenance, cruising necessities vs. want, and sailing in real 'weather', as Charter/Club (actually their insurance Co.) restrict their boats to sub 25 knot days so not much of a learning platform other than basic sailing and navigating, not that they aren't valuable, but dealing with weather and maintenance etc. is really important to us gaining the confidence to cruise.

As for making an offer. I am close to putting in a couple of offers to test Seller motivation. One boat I was mildly interested that I thought was a typical/reasonable asking price just dropped their price 25%. Reason; lack of offers. I have represented Sellers in hundreds of transactions, and sold about 30 of my own deals, and I know as a Seller if you are motivated you want to see an offer. In this environment, I am sure anyone selling a boat knows they have picked a tough market and Buyers are in the 'cat bird' seat for the foreseeable future. I have time on my side and sometimes the best deal you made was the deal you didn't get. So patience and diligence are my watchwords and if a Seller is insulted by my offer then he can counter me, if he doesn't he is either unmotivated or unrealistic or both. The only risk for me is I will blaze the trail to reality but the Seller get's to emotionally involved and won't let it go at that price. Then a month later he has a 'come to Jesus' moment and is all of a sudden ready to take my deal. Happened to me many time in my RE investing we will have to see.

[MarkSF]

"I am close to putting in a couple of offers to test Seller motivation."

I thought the purpose of putting in an offer was to buy a boat?

No offense, but you sound like a nightmare to deal with. To quote Oscar Wilde : "A cynic is a man who knows the price of everything and the value of nothing".

My approach was to find a boat that's beautiful and that l love. That's what will get you through the tough times when you get a huge bill and/or a complex, time-consuming repair. It'll also get you through bad weather and conditions that make you want to be at home.

Getting 25% off the price on a commodity boat won't do any of these things.

Wonder which one of us will be happier with our boats in 5 years time?

[RELENTLESS 1]

MarkSF

Me? A Nightmare? Quite possibly the nicest thing anyone has said to me today! (Grin)
There is a point where analysis becomes paralysis. After riding through 3 Real Estate recessions I am cautious, and despite all of the negatives I have always been able to pull the trigger (some 40+ times) when I was satisfied with the deal. And the boat, to me is first a deal, I have no sentimentality when it comes to my buildings or to this first boat. It is a means to an end. A three year program to gain experience, confidence, knowledge and understanding. It is our 'boot camp' before we decide on the big investment into 'The Boat'. Nevertheless, I will cop to this one emotion, and my wife and I both agree on this, it has to have some aesthetic draw beyond 'deal'. Otherwise we 1. Won't want to sail it 2. Won't want to invite friends 3. We won't want to take care of it. In short, your point is well taken, there for sure is a level of pride of ownership, whether that is 'out of the box' or requires some elbow grease on our part. This is a date to the Prom, not the wife for life boat for us. Thus certain boats have been automatically struck from the equation as they are not appealing, have odd layouts, undesirable setups (e.g. traveler in the cockpit) or 'value' as we see/feel about it.

5 years from now I believe we will have purchased the boat we will love, and though there will be compromises as in anything, our 'boot camp' will at least give us a sense of direction in what we are willing to compromise on or not. What is important for our plans and lifestyle on the boat and what we can live without be it stateroom. galley size, electrical capacity, cockpit .....etc. From there we plan to be with her until we can't any longer.

I am thankful for the response, my wife and I are listening to all of the advice and allowing it to seep into our decision making. As I said before, I can only see this from one angle and hearing great advice from people who have 'been there' I see entirely as a positive steepening of my learning curve.

Thanks again,