How to Purchase a Far Away Boat

[vjm]

You run the risk they will sell it out from under you or decide not to sell if they are not locked into a contract. Yes, it requires you to write in that the sale is subject to your personal inspection as well as a sea trial and survey. All you have to do is put a time limit on it for them, like "conditions will be waived or executed by 30 days after acceptance of this contract". Then they know you aren't just going to tie them up indefinitely.

Sorry to beat the drum on this, but I just ate the cost of flight, hotel, and car when a seller (who had committed to a price and insisted on sending more pictures before I made travel arrangements) decided to keep the boat. It sucked. If I had had a signed contract he would not have been able to do that, and while he may have made the same decision it would have been before I made travel reservations.

Figure out a fair price if everything works and is in the condition that is represented. You can always renegotiate after the survey if things don't work or are in poorer condition. If they are asking 77 and aren't even really on the market I bet they balk like a spooked horse at 60. It's worth finding out if the deal could even go through between you before you spend good money on travel. You aren't committed to paying the contract price, it's just a place holder until you can get a real number for this boat.

But that's just me.

Great boat, and I am sure you will enjoy it, or one like it very much.

[zippy]

I live in Canada and bought my first large boat in the US. I plan on buying another (bigger) boat outside of Canada in about a year. In order to justify the travel, I am looking for a bargain (like everyone) compared to the average price for that model. I don't think it is possible to secure a good deal without first getting a conditional offer accepted before you travel. I also want to know that I can buy the boat if I want it, and it won't be sold while I am looking. If a boat is listed at $150,000 and you can/will only pay $125,000, you are wasting time and money by not securing an offer before you proceed. If the boat has been misrepresented, in your view, than your deposit is returned upon your inspection. My process is:

1- When you find a boat get as many pictures as possible, complete description and talk to the seller.
2- Make an offer as to what you are willing to pay based on the description, contingent on your personal inspection and/or survey results. You have now secured what you think is a bargain deal on that boat. Few offers will get this far.
3- Travel to the boat and see if it is as you expected. I will know now if the boat is worth surveying.
4- If it is the bargain I expected, I am looking for big ticket items on the survey and not looking to nickel and dime the seller, so I can schedule the survey and haul out at a later date. I may or may not attend the survey depending.

This worked for me once, hopefully my next purchase will go as well.



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[Terra Nova]

When neither buyer nor seller are represented by a broker, it is helpful to hire a broker just to handle the contract, escrow funds and see that title and such are properly dealt with. Their charge for such service might be several hundred $.

Forget about dirtying up the deal by asking sellers to let you sleep over and chauffeur you around. You certainly don't need to take up a weekend of their time to inspect and sea trial the boat.

[Dsanduril]

Originally Posted by jdazey

... At least try to get some time alone on the boat....

Having just been through this process with an owner-liveaboard-seller, this one is a critical item in my book. It will be hard, this is their home, but you are the buyer. You have the try the boat on for yourself, and be able to look anywhere you want without someone over your shoulder, asking questions, or pointing out something else, or distracting you (deliberate or inadvertent). Make sure you tell them up front that after you meet and do a walkthrough you will want at least an [hour, two hours, whatever] on the boat by yourself (or with your surveyor, or someone else you trust who is working on your side).

[Cheechako]

I would say in most instances, not realistic. If you give yourself a week or so... more realistic.
-first; most boats are nothing like they look in the ads.
-Hard to negotiate a fair price too quickly and hard to determine what it's worth to you if you haven't even seen the boat yet.
-I don't think most surveyors would appreciate you cancelling, but the non busy ones might not.
-You wont find a yard to haul the boat on Sunday likely.
-your trip is short. A day trip to view the boat is not expensive and a good thing probably. View the boat, take pictures, ask a million questions... then GO HOME.
-think about it, if you want make an offer in a day or two, negotiate hard.
-once that's done, arrange the whole survey sea trial.
-negotiate again based on problem items.

[Terra Nova]

ko--good post.

[Cheechako]

Originally Posted by OrangeCrush

Wow, sorry I've been slow to chime back in here. Incredibly helpful info, everyone, thanks. Now here comes the follow up... I'm trying to respond to many of your comments so settle in and forgive the length.

The boat is a 1986 Southern Cross 39. The sellers are a couple currently living aboard but reportedly ready to sell. They are asking 77k and they're not using a broker. I know of two other SC 39's that started above 60k and sold for less than 40k. Then again, this boat is newer, nicer and much better equipped than the others I saw. Everything is reportedly in good to very good condition with all systems functional. If everything checks out well, I'm thinking this boat may be a bit overpriced but not wildly so.

It's encouraging to hear you think I can work on getting the price down before going to visit. But do you think I should simply reveal to them my true and honest upper limit (which is around 60k assuming a really great boat) and see if they are open to it? Or should I offer something lower first as I would in a more conventional negotiation? Or give them a range? I feel like telling them my upper limit almost locks me in to that (except for survey issues). On the other hand, making an offer on the low end runs a higher risk they tell me to take a hike.

Obviously fitting it all into a weekend was wishful thinking. I'm a middle school teacher and I won't be taking any weeks off until summer, at which point I have all of July. If some of this process has to wait until then it's ok. But if possible I would rather have the purchase sorted and spend July prepping the boat and sailing home to NYC. If this boat doesn't work out for whatever reason, I'll still be on the hunt and squirreling away money to increase my boat budget.

From here I see a few ways of approaching it....

I like your bold approach, Reed. It's wouldn't be impossible but I think it's too risky for me to go straight to the survey without seeing the boat first.

The next approach would be that I fly down myself and spend a whole weekend carefully checking it out on my own, including a thorough sea trial. I am pretty comfortable inspecting things myself, at least until the pros take over. At this point I've looked at more than a few boats, I'm acquainted with problem areas, I have a moisture meter and I know how to use it, etc. But I don't really know how I would create a contract before this type of visit as vjm suggests. It seems like that would be just as likely to work against me. With this approach I run the risk that the boat is not up to snuff and I lose a few hundred on the travel. But if I like what I see, then I can haggle over the price, make a real offer contingent on survey, and I hire the surveyor to follow up without me. I can find a very reputable surveyor who provides a sample of what he will be reporting on beforehand and I make sure he addresses any concerns I have from my own personal inspection.

The third approach would be to just plan on two separate visits from the outset, one for my own inspection and one to attend the survey. This is the most costly but least rushed option. Or I can start out with my own visit and decide later whether or not I feel the need to be there for the survey. It seems like there is a near consensus that it is worth the cost of a second trip to be there. By the time I get to that stage I will no doubt be eager to be as involved as possible so I'll just plan on that.

Great advice about asking to get picked up at the airport and to stay on the boat, Grant. That's what I meant about needing some schooling on the etiquette.

Some more assorted questions...

How formal is a sea trial, generally speaking? I do that myself without a professional on board, right? I have plenty of experience on boats of this size and I think I can judge its sailing and motoring characteristics pretty well, especially with some methodical preparation and checklists.

How much should I expect to pay a mechanic to go over the engine? What kind of checks should I be asking for? Should I at least ask potential surveyors about their ability to do this, or just skip it and find a mechanic? Is a compression test necessary? I'm expecting the sellers will have a preferred yard for haul out, but I could try to find a disinterested mechanic from the area, or I could find another yard with a mechanic to do both the haul out and motor check.

Not trying to "skimp" on anything so shoot me down if this is a bad idea, but can I perhaps do the motor and rigging inspections myself with careful preparation and diligent checklists? The motor is a Universal 5432, "new re-manufactured with 450 hours". The mast was recently repainted with Imron (I'm not crazy about this) which I guess could complicate the rig inspection, but I have no problems spending time aloft to check it out carefully.

Thanks again for all the help and encouragement! I've definitely got my work cut out for me. Collecting more info, negotiating a price, choosing an insurance carrier and finding a good surveyor are the first orders of business.

In most cases I've taken the surveyor on the sea trial. He needs to know things from the trial. Listen for sounds, electronics tests etc. While he doesn't survey engines, he will inspect such and comment on things he doesn't like.
Unless there is a reason for such, most often the surveyor has inspected the boat in the water, tapped the deck etc first. If nothing too big , then we either sea trial or haul next.
It's hard to get much from an engine inspection. It either runs well or it doesn't. The fluids are checked for any indicators of course. Visual or audio indicators. Compression test would be a big plus but often not available due to special adaptors needed for diesel engines.
With other available boats sold at much lower prices you are in perfect negotiating position. Electronics over 5 years old are worth zero when comparing boats.

[OrangeCrush]

Originally Posted by Cheechako

I would say in most instances, not realistic. If you give yourself a week or so... more realistic.
-first; most boats are nothing like they look in the ads.
-Hard to negotiate a fair price too quickly and hard to determine what it's worth to you if you haven't even seen the boat yet.
-I don't think most surveyors would appreciate you cancelling, but the non busy ones might not.
-You wont find a yard to haul the boat on Sunday likely.
-your trip is short. A day trip to view the boat is not expensive and a good thing probably. View the boat, take pictures, ask a million questions... then GO HOME.
-think about it, if you want make an offer in a day or two, negotiate hard.
-once that's done, arrange the whole survey sea trial.
-negotiate again based on problem items.

Hmm you do make a good case... I guess I'd be more likely to either pay too much or mess up the deal if I made an offer without any knowledge of the boat. So you wouldn't talk money with them at all before going down there? You're right about the day trip, too.

[Cheechako]

Originally Posted by OrangeCrush

Hmm you do make a good case... I guess I'd be more likely to either pay too much or mess up the deal if I made an offer without any knowledge of the boat. So you wouldn't talk money with them at all before going down there? You're right about the day trip, too.

Well... it's hard for sure. Each instance is different. Depends on how good the pics and listing are, how well you know the market, has the boat been listed for a long time or just listed? etc.
You could negotiate up front and always walk away later, then come back later yet with your best offer based on "what you saw and thinking about it".
In general you will likely find a boat listed only say 3 months ago the owner is not very negotiable. A year ago, might be very negotiable. Is the owner nearby? or 3000 miles away.
I finally sold the 38 footer (noted in my early post) at 40% below list because it had sat well over a year, needed maintenance, and I was in the PNW and the boat was in Florida! I was just ready to wash my hands of the deal at that point.
I probably should have went down, spent a month on the boat at a new location and relisted with a new broker.
There really are no wrong moves, just whatever works for you.


BTW, with today's cellphone cameras.... when you look at the boat, try to take a pic of the registration or anything with the owner's address /info. You never know how that might help. If you end up with an obstructive broker, you can always contact the owner and ask questions about the boat. It's amazing how owners will sometimes say too much!
I had a boat listed once and had an "almost" sale with the broker. I met with the potential buyer over a drink and went thru the boat details with him. He had walked away in negotiation with the broker. He bought it immediately after our discussion. Brokers are terrible at explaining things, knowing things and selling often! I still had to pay the lousy broker.

[OrangeCrush]

Originally Posted by Cheechako

Depends on how good the pics and listing are, how well you know the market, has the boat been listed for a long time or just listed? etc.

Unfortunately I'm not sure how long this boat has been listed, as that would help. I have been keeping track of prices diligently for almost two years but this boat slipped below my radar since it only comes up under a search for "CE Ryder" and not "Southern Cross". It has been listed for 3 months that I know about, perhaps much longer.

That's good advice about dealing getting around a broker, but this one is listed for sale by the owner. Terra Nova's idea of using a broker for escrow is another good piece of advice, thanks.

Does anyone else have an opinion as to whether the figure of 60k on an asking price of 77k will be seen as an insulting low ball or a reasonable offer for this boat?

There is also the chance that they balk at the number 60, but that it looks better after the boat sits on the market for a few more months. I'm saving up money rapidly right now, so by then I could meet them in the middle.

Jack

[Terra Nova]

Originally Posted by OrangeCrush

...Does anyone else have an opinion as to whether the figure of 60k on an asking price of 77k will be seen as an insulting low ball or a reasonable offer for this boat?...

Try to find out the actual selling prices of comparable boats. Judging from that information, and weighing differences in condition and equipment, establish what nearly certainly must be a fair price for this particular boat, disregarding unseen problems likely to be exposed during survey.

There is no reason to talk $ until you have seen the boat, assigned a tentative rating (1-10) and become aware of any tugging feelings around the heartstrings. If/when you and the seller reach an agreement on a fair price, if you really want the boat, but come up a little short of that amount, then is the time to see you can arrange some interim financing, possibly from the seller. Or make some other trade or compromise.

[leftbrainstuff]

Originally Posted by OrangeCrush

Hello,

I'm looking to buy my second boat, a much more significant purchase than my first, and I could use a little schooling on some of the protocol and etiquette. I'm located in New York and I've looked at a number of boats in my area, but now I'm interested in one located in South Carolina. I will need to fly down there to see it and get it surveyed (plus hotel and car rental). Assuming a lot of best case scenarios, I'm wondering how much I can expect to streamline the process and reduce the costs.

Please tell me if this is at all realistic: I fly down on a Friday evening sometime in the next month or so and view the boat on Saturday, maybe go out for a sail. If I don't like what I see, game over and I cancel the surveyor I have booked for Sunday (can I do that??) and go home. But if I want to move forward, I make an offer contingent on survey. If we agree on price then the surveyor comes and I have a local yard haul for the survey. Will a surveyor ever look at the motor or do I need a separate mechanic? Is hiring a diver (or doing it myself) ever preferable to hauling out? Is it at all reasonable to attempt to do all that in a single weekend?

If everything goes well at the survey, it seems like the rest of the purchase could be completed from a distance. Once I have a bill of sale, then I can register the boat in New York. Will I be able to get insurance for the boat in New York using the survey I had done in SC? I'd need to leave the boat where it is until the end of June when my work is over and I can go down there, prep the boat and bring it back up North.

To make things more complicated still, I'll need the seller to come down a fair amount on price (~20%) for it to work for me. Is it ever appropriate to talk money before coming to see a boat? I was thinking maybe the vague but direct route is better, to simply ask if their price is firm or flexible. If they say their price is very firm that could save me a pointless trip. But it seems hasty or counterproductive to speak real numbers before seeing anything. Do I have that right?

I've spoken with the owners; my next step will be to start calling up surveyors with many of these same questions. But I thought I would run it by the forum first as I am sure some of my assumptions are wrong. Thanks for helping me figure out the best way to go approach this. I won't rush the purchase if things don't work out right, but I also want to be ready if they do.

Last question, anybody know a good surveyor near Beaufort, SC?

Jack

While in Australia we had our San Diego based broker fly to Seattle to conduct an initial survey and arrange a mechanical inspection.

We had already built a relationship with our broker during our 80 road trip around the US.

We had the boat, a Liberty 458, under contract two days after it listed on yachtworld.

Our broker took many hours of video with the owner. This allowed us to make an informed decision.

I would not recommend using a broker you don't know local to the boat. Use a broker who knows what you want.

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[OrangeCrush]

Originally Posted by Terra Nova

There is no reason to talk $ until you have seen the boat.

I think I'm with you and Cheechako on this point. But perhaps my original idea of a vague question like, "Is your price firm or flexible?" might be helpful to prevent a wasted trip?

[OrangeCrush]

Another quick question while we're at it, this one about sales tax.

Sales tax is paid where the transaction takes place, and South Carolina has a cap on sales tax of $300. But I will need to pay sales tax again in New York when I register the boat, and the fact that New York and SC have a "Full rate eligible for credit" arrangement just means that I will have a $300 credit toward the normal 4% NY sales tax. Plus I have another roughly 4% local sales tax on top of that?

Do I have that right?

[FecklessDolphin]

We just a bought a boat in Maine while living in Minnesota. I had seen a sistership and felt that I did not want to fly to see another. We made an offer that was contingent on survey and personal inspection. Once the offer was accepted we had a survey done. I went to see the boat a few days after the survey. Closed the deal a few days after that. It helped significantly that I was working with my own broker. My broker already knew the surveyor and the seller's broker. To my broker's credit, he did not push his own listings and instead sent me links to boats.