Buying a yacht with broker representation vs no representation

[taxwizz]

Check Practical Sailor for a good summary of what to look for in a used boat.

[buzzstar]

I hope you have throughly researched the prices. They seem to be all over the map, I never actually investigated, but I've noticed a few in the range of much more worthy boats, and some so low that the outboard justified the price. I've sailed one only once, from Marina del Rey to Channel Islands (Oxnard, California). I was unimpressed. The hull oil canned, the rig was poorly adjusted, and the tiller required a firm hand at all times. I felt much better the we arrived and went to the outboard. I suspect the sailing characteristics can be improved by proper adjustments, but the oil canning is still in my memory -I'd never encountered it to such a degree previously and did not like it.
I also wonder if the seller's broker became involved as a prat of another transaction or is a friend of the seller providing a favor. There is not much meat for a broker is the price is actually low, and if it is not the price is too high.

[hamburking]

Originally Posted by YachtBroker

Most sellers do not either as most brokers have a minimum commission of $3-5K even though we still get a lot of boats listed in this price range because the sellers don't want to deal with the hassles of selling them.

Ironically, if the sellers offered their boats for sale privately, at a price reduced by the commission they would have paid a broker ($3-5K as you say), their boats would likely sell quite quickly and easily.

In most cases, sellers want the high sale price for their ego...even if they have to pay a huge commission to get it, or pay ownership fees for an additional year or two.

[Suijin]

Originally Posted by hamburking

I'm still trying to figure out why the SELLER has a broker?

As you said, its a small boat, and not a ton of money (depending on the year). Why would the seller prefer to give away 10% of the sale price instead of just posting some local ads?

In the same way that using an accountant to do your taxes easily saves you more than the cost of their fee, a selling broker is often going to get you more for your boat than the 10% commission they take. Part of that is simply that they have a different target market; people who are looking at Yachtworld and other sources of boats under brokerage vs. hunting for deals on Craigs List or Boat Trader.

Also, selling a boat through those latter two channels can be a royal PITA. Dealing with scammers, tire kickers, and showing the boat a dozen times to people who don't end up making an offer. It comes down to the value of your time.

[buzzstar]

To supplement my previous post in this thread, in my ignorance I had not realized there are several versions of the MacGregor 26. I believe the one I sailed was, probably, a plain 26, although I do not know for sure. Perhaps they are much different boats, but I did not observe the basis for the big price differences in the versions I saw in doing a quick perusal of listings, and this even allows for some fancy or pricey "improvements" such as wheel steering and what appeared to be a head compartment.

[Cheechako]

For that boat no, don't worry about a broker. If no experience get someone with experience to look.

[Swanmate]

We have been trying to buy a boat with a broker for several months. THE LISTING BROKERS ARE ALL CROOKS, in my opinion. Think any broker will allow you to purchase a boat they have listed if they have to split their commission with your broker? Think again. We have had 3 purchases fail for this reason. One offer was for full asking price with no financing contingency. The listing broker clearly wanted to find his own buyer and strangely, our offer was allowed to expire without a response from the seller! Therefore, it doesn't matter how reputable your broker/agent is, it is all about the listing broker.

[Bulawayo]

Plus 1 for what Pete7 wrote. A broker just adds to the costs in many parts of the world but does often bring buyer/seller together via marketing. Beyond that I have not seen any value.

Originally Posted by Pete7

were are you going to use this M26. They don't have a great reputation and it would be worth Googling them so you are fully aware.

You can offer what ever you like and the agent and the owner are free to accept or turn down your offer. You and the agent can then decide to meet somewhere in the middle. Do your homework find a price you think its worth compared to the others on the market and offer slighty less. You can always up your offer. Don't be afraid to walk away for a while, its like playing poker, who will capitulate first.

The use of an agent to buy a boat on your behalf seems an Amercian thing, doesn't happen this side of the pond, although a surveyor is.

Pete

[TrentePieds]

Quote: "THE LISTING BROKERS ARE ALL CROOKS"

No! That is an unfair accusation. But what we must all remember, and too often forget, is that commerce IS combat. The seller's interests are OPPOSED to the buyer's interests. And vise versa. And that can never change. A seller's broker is obliged in law to be hostile to the buyer's interests, and a buyer's broker is obliged in law to be hostile to the seller's interests. That is as it should be. It's called "free ennerprize" :-)

You are required, whether you are a buyer or a seller, to understand that, and conduct yourself accordingly. That's called caveat emptor and is as it should be.

If you can, and do, understand that, then neither seller not buyer needs a broker!

TrentePieds

[hamburking]

Originally Posted by Bulawayo

Plus 1 for what Pete7 wrote. A broker just adds to the costs in many parts of the world but does often bring buyer/seller together via marketing. Beyond that I have not seen any value.

Before the internet, smartphones and the www, brokers did add some value by way of marketing by advertising their listings in the printed sailing magazines, newspapers, at boat shows, and in their office. This was a worthwhile service.

And now welcome to the 21st century. Anyone can make a web page to sell their boat. Anyone can post their "boat for sale" ad online and it will be seen and noticed.

From what I've seen, sailors are some of the most self reliant, intelligent and resourceful people I have ever met. I'm sure just about every sailor is capable of selling their own boat.

However, there are circumstances when the service of a broker is needed...illness, death, distance, laziness, or lack of interest for example. In this case, the broker does provide a service. But his service does not increase the value of the boat at all.

[TrentePieds]

Let us also remember that as a result of the ineluctable fact that commerce is combat there is ALWAYS a small matter of making sure that title does not pass without funds passing, and making sure that funds do not pass without title being passed. And THAT, by way of the trustees duties the law imposes on brokers, is the most important residual function of brokers in the 21st century. For my money a notary public's services are just as good as a brokers in respect of that particular component of a buy/sell transaction. It doesn't matter who retains the notary - buyer or seller - because a notary is NOT commission-paid and therefore has no vested interest in the transaction. The professional and legal constraints on a notary are also far more stringent than those on a broker.

TrentePieds

[fuentes]

Be aware of the possibility of a bait and switch. This is not a bad thing. The broker has access to many other boats that may suite you better. Look around. You also have the ability to look into other boats. It is just a matter of how much time you wish to dedicate. For me, it is part of the adventure. It is also a way of obtaining a lot of knowledge. Getting to know the condition and all the other aspects of the boat you are buying will save you money and time later plus add to the enjoyment of your boat.

[BAOSIN]

Thanks for all the opinions! If the survey is going to cost more than a few hundred dollars, it won't be worth it.

I own an Elan 34 moored in Japan and have been sailing in there for 8 years now. I live in Seattle now but travel back to Japan in the summers. I have enough room to park the boat on a trailer in front of my house. So I figure the MacGregor 26M (2006 or later model is what I am looking at) would be a decent 2nd boat and cheap. I will miss the best sailing season in Seattle because I will be in Japan so this boat will be my boat for the shoulder months of the season. I am not going to take it outside of the Puget Sound area and the lakes/inlets of this region.

From reading about the MacGregor, I wouldn't want to take it offshore or in anything choppy. I've been in some choppy situations in Japan where the weather can be rather unpredictable. I know how that is and having a bigger and keel boat would be a safety issue not a luxury.

In Japan there is no marine survey system at all. So I've had to survey the boats on my own with a hammer, moisture meter, etc. Actually my nose is a good moisture meter. If I smell mold there is likely an issue. Thanks for all the links! Very helpful!

[nautical62]

1. As a buyer, why limit yourself to what a broker wants to sell you when it's so easy to search the market on your own?

2. Most M26s are going to be for sale by owner, not through a broker, and you will likely find a better deal in a for sale by owner boat than a brokered one.

[northwestsailor]

Boat brokers are not subject to the same ethical, legal and regulatory oversight that real estate agents are. So make your own decision but personally I wouldn't want someone involved that had their own pocketbook interests at heart. You will up paying in more ways than money.