10%??? Seriously???

[MicHughV]

Having sold a few boats....the 10% is hard pill to swallow...but you have to remember the house usually takes half....so 10% of a $150,000 boat is $15,000....leaving the broker with $7,500...and if there are two brokers in involved, it is halved again....$3,750.....very common....remember also, the broker has to come see the boat, take pictures, etc....A seller knows there is a 10% commission involved and will often jack up his asking price to cover this, but brokers have access to " sold" boats data and will discourage you from putting a price on the boat putting it out of range.

A broker may have several listings, so will spend a lot of his time " showing" a boat....brokers can usually tell if a buyer is serious or just wasting his time.

So the broker shows your boat a half dozen time, meaning he has to drive there, sometimes fly there, etc, plus sea trial, tons of paperwork, etc....so he might have ...say....80 hours of his time in there, likely more if he has to arrange financing, etc...that's about $47/hr.

This would be fine, if he is working 40 hrs a week, 52 weeks a year, but he might only sell 1 boat every few months.
And, despite all his time, may not even get to sell the boat and not make a dime.

The above illustration is for a $150,000 boat....obviously, a smaller priced boat will be significantly less.
Selling a $75,000 boat takes every bit the effort it does as selling a $150,000, but for half the remuneration.

That's for the seller...the buyer still has to face the tax hurdle..typically 6.5-7%....another $6-7K.....then come slip fees, insurance, and if the boat has to be documented, more $$$.

I found that there is some wiggle room usually. The broker wants to sell your boat, if he doesn't sell your boat, he doesn't make anything at all, so all his time is for naught.

I've come to a broker and have said, well the buyer's offer is $5K to low....I'll accept it, if you give me a reduction in your brokerage fee. This puts the broker in the hot seat. He has to go back to his boss, and and convince his boss to agree. Some will, some won't, but it's worth a crack. The broker (and his boss) knows that unless the boat sells, there will be no commission at all. In a slow market, they will likely be more willing to consider this. In a hot market, likely not.

A lot of boats sit on the market for a long time. For a variety of reasons they become difficult to sell, further compounding a broker's issues, so if the boat has been on the market for a while, the brokerage house tends to be more flexible.

Some brokers have been at this game for a very long time and are very good at negotiating a deal. If you have a broker, and the seller has a broker, they will contact each other to see what's up. Both brokers have an interest in selling the boat. Even though your broker is ostensibly in your camp, he is also looking out for his own interests.

You can off course, try to sell the boat yourself. Many have tried this, myself included, and you will quickly learn the effort it takes.

Even thought you have your boat listed with a broker, you can still sell it on your own, but will still be obligated to pay a reduced fee to the brokerage house.

No matter how you slice it, brokers earn their money.

For a newbie buyer or seller, there is a learning curve involved here.

[Stewie12]

Brokers commission is 10% worldwide paid by the seller. . Sometime you can get the broker to use part of their commission to close a deal.

[MJH]

Originally Posted by EngineerRetired

I was talking with a seller and he told me his broker is charging 10% for selling his boat. I told him he was nuts if he paid him.


25 years ago, maybe,,, it was justified because ads had to be printed in magazines and such, selling was a lot more work but today, the owner takes the photos and the broker slings them to the half dozen "boat for sale" sites and, that's about it. MAYBE they show the boat, but in today's market people are better informed on what they want and do not do a lot of tire kicking, at least not with a broker holding their hand.


I recently sold a farm, lot more money than a boat and, the realtors got 4% because I negotiated it. It's ludicrous that any broker, realtor, agent, whatever gets paid 10%. People need to put their thinking caps on!

While it is true that everything is negotiable, different items and different locations have different standards. My wife has been in real estate for over 20 years and the standard is 6% for houses and 10% for just land sales. The 10% for boats has been standard for as long as I know. Just remember that those percentages are split between the selling and the buying agents and their respective agencies. If the selling price of the item is lower, their commission is lower...I know of some agents that would not take on a sale because of that reason...it was not worth the trouble dealing with buyers for that little money.

Lastly, some sales are fast and incredibly easy but others are a pain in the a** for any number of reasons. My wife dealt with one buyer for years and he ended up buying through someone else...a total loss of effort.

I have sold two boats on my own and the first (22') was very difficult and only weeks before my transfer to Europe; selling under pressure is never good. The second (28') was fast and easy because she was a beautiful boat in excellent condition and price correctly (follow the market for a while and watch prices drop on specific boats because they were originally overpriced). Both buyers were just getting into sailing, the first retired and the second a young family. I suspect a knowledgeable buyer can be more difficult.

Try selling your own boat for one season and learn what it is like dealing with buyers. Despite my positive experience I don't look forward to selling my present boat (42') when the time comes.

Good luck.

~ ~ _/) ~ ~ MJH

[contrail]

Granted, we are living in unusual times, but earlier this year, I sold a mid-range six figure cat in a few days and bought a low six figure one, also within days of its listing. In each case it was a fair price with no haggling, and done without a broker. Years ago, I asked a broker how to go about selling a boat. He told me to do three things: prepare the boat well, to be shown, price her fairly, and accept the first offer! The first two suggestions were obvious, but I questioned the third. He was a very experienced broker, and he said that for a used boat, the best offer is the one you will get first, because it will come from a person who is looking for that specific type of boat, and keeps an eye on what hits the market. He said most people turn that offer down, because it comes so quickly that they feel they can sell the boat for their asking price if they wait a bit longer. But, apparently, after a month or so, a boat becomes a commodity, brand X, built in year Y, and not something unique, and subsequent offers verify that. Months later, and after a good bit more expense, the boat sells for a lower price.


When I sold my boat, in the first conversation I explained that my boat was as pictured and described, and offered to do a video walk through. I also said that it was fairly priced and that they should be prepared to pay that price, if they liked the boat. If they didn't like the price, then there was no purpose in going further. They said the price was fair, and after two lengthy conversations and the walk through, we made a deal contingent on them actually seeing the boat and surveying it. I said not to plan on the survey bringing the price down on little things, that I had told them the accurate age of all the equipment, and that it was in better shape that the age might suggest. The sale went through and we are now friends. Interestingly, they were looking for a boat just like mine, had inspected a number of sisterships and similar ones, understood the pricing, etc. and had been keeping their eyes open to find the right boat. In other words they were just who that broker had suggested would be the first prospective buyer.



I was also a very early responder to the previous owner of the boat I bought. And I was also looking for a very specific model, in very good condition. We had no problem coming to agreement, either.


When it comes to brokers, I have always understood the standard commission to be 10%, but I did have a broker, who would have liked to have sold my boat, suggest that we could work something out. Granted, he knew it was a desirable model, and 10% would have been a nice chunk. I have bought two boats through brokers, by the way, and had great experiences with both. They earned their fees. I am not anti-broker, at all, but some of the stories I hear on CF make me wonder if I should be!

[canyonbat]

The broker who sold our Beneteau 40 earned his 10%. First offer backed out before sea trial or survey, decided they were beyond their budget. Second buyer backed out after survey and sea trial because he couldn’t find a live-aboard slip in Seattle (go figure?). Third time was the charm. Both sea trials involved our broker having the boat launched and the head sail installed/taken down, batteries hooked up, etc.

[EngineerRetired]

Originally Posted by Mike OReilly

Tell us how it goes.

I surly will.

[EngineerRetired]

Originally Posted by canyonbat

The broker who sold our Beneteau 40 earned his 10%. First offer backed out before sea trial or survey, decided they were beyond their budget. Second buyer backed out after survey and sea trial because he couldn’t find a live-aboard slip in Seattle (go figure?). Third time was the charm. Both sea trials involved our broker having the boat launched and the head sail installed/taken down, batteries hooked up, etc.

So maybe two days of actual work? For what size commission? Not to be mean but if he is making $5k a day for showing two buyers he is making a killing.

[friz]

Originally Posted by EngineerRetired

I am too tight, I would not pay Jesus 10% to perform a miracle.

I doubt if Christ has any interest in your money. The comment is in bad taste.

[SteveSadler]

10 % has always been the standard commission for boat sales and well earned. Just as 6% has always been the standard in real estate. This is split between buying and selling agents, and the brokerage companies involved. Boat prices are a fraction of home prices, but same amount of work. Buyers will usually use a broker for his/her knowledge and experience in the industry to help them choose wisely among many possibilities. Often consulting with the other agents in their brokerage pooling their knowledge. You can always try for sale by owner, but no agents are going to bring their buyers.

[ArmyDaveNY]

Originally Posted by EngineerRetired

So maybe two days of actual work? For what size commission? Not to be mean but if he is making $5k a day for showing two buyers he is making a killing.

The second word sums it up. Maybe. Having been in sales, there may be more to this than just two days of work. We don't know how many calls he took before there were any showings, or any other work he may have done.

Having said that, even if he did just two days of work, I suspect that is not the norm. I am sure that there were many other sales where he made less and worked much more.

I always loved the low hanging fruit but alas, they are not the majority of sales.

[Dooglas]

Originally Posted by EngineerRetired

I'm looking to buy in the immediate future and I'm thinking of telling the broker I want half the commission applied to the price. 10% is plain nuts.
If one won't take the deal, another one will. Human nature is what it is. (A little greedy and eating the other dogs bone has always been a good time.)

The catch is that the one who would take up your offer is the one who is not having much success at selling boats.

[EngineerRetired]

Originally Posted by friz

I doubt if Christ has any interest in your money. The comment is in bad taste.

Strange, Mohammad laughed his butt off. Can't please everyone I guess.

[EngineerRetired]

Originally Posted by ArmyDaveNY

The second word sums it up. Maybe. Having been in sales, there may be more to this than just two days of work. We don't know how many calls he took before there were any showings, or any other work he may have done.

Having said that, even if he did just two days of work, I suspect that is not the norm. I am sure that there were many other sales where he made less and worked much more.

I always loved the low hanging fruit but alas, they are not the majority of sales.

I think many miss the point. A half million dollar house, a half million dollar boat, one agent making 4% or 5% the other taking 10%. And yes, selling homes is very comparable to work and time invested. Paying someone 10% in this sellers market where boats are snapped up in days is, IMHO, plain foolish.

[EngineerRetired]

Originally Posted by Dooglas

The catch is that the one who would take up your offer is the one who is not having much success at selling boats.

TBH, could be, would not make any difference to me. Could be someone starting out, could be someone willing to make a quick and easy 5%, could be a lot of things. Like someone said, in life EVERYTHING is negotiable.

[old pirate]

Agree with Contrail ,above.
Recently sold my 40+ catamaran privately. Brokers offered 5% com, but with such an active market we wanted to save the $$$.
Received 5 offers in first week, 2 acceptable. Ad had 4000 views over the 4 weeks I let it run. 20 requests for phone number,but only 12 contacts. So as can be seen there are a lot of time wasters out there !
There was a similar catamaran for sale at the same time by owner. The comments from the shared buyers were that the owners were rude and the boat was not in saleable presentation. Obviously they had let the “tyre kickers” get to them.
Selling by owner is not for everyone.