Would you compensate your boat broker when there's no commission split?

[JulieMac]

Started looking at sailboats again, most in the $25-35,000 range. We're using a buyers broker. He's suggested a couple of boats, but they weren't good fits.

I've been looking up boats online, then have him call the listing broker to dig deeper for more info. Problem is, with boats of this value, many listing brokers won't commission split.

I feel bad, and don't want to waste my broker's time. Neither do I really want to "cut him out" of a purchase, since he's invested some time showing us a few boats.

In these other cases, it's the out of town listing broker who shows us a boat.

I've offered to comp my guy something for his phone calls, should there be a sale. From what I've learned, the listing brokers may or may not offer him even a small fee.

How much, if anything, would you pay your buyer's broker for making the call for info on an out of town boat where no commission split exists?

[l2ridehd]

5% at a minimum.

[Paul L]

What does your contract with the buyers broker say? Why not follow the written agreement you and the broker made?

[Cheechako]

Originally Posted by Paul L

What does your contract with the buyers broker say? Why not follow the written agreement you and the broker made?

If there are exclusive listings out there that wont share, they probably wont share with just any other seller's broker either.
Your broker should know that, and realize it's something he has to deal with.

[svHyLyte]

Any purchase offer should include a condition that any commission paid by the Seller shall be shared equally by Seller's and Buyer's brokers at closing but in no case shall the commission paid to Buyer's broker at the closing, from funds due Seller, be less than 5% of the final sales price at the closing. BTDT...

[Paul L]

Originally Posted by svHyLyte

Any purchase offer should include a condition that any commission paid by the Seller shall be shared equally by Seller's and Buyer's brokers at closing but in no case shall the commission paid to Buyer's broker at the closing, from funds due Seller, be less than 5% of the final sales price at the closing. BTDT...

They are trying to buy a boat, not run the buyers brokers business. Why complicate an offer. The brokers have their contracts in place and do just fine protecting their own interests.

[JulieMac]

I do not have a contract with the buyers broker.

I feel like this is similar to a real estate purchase. Assume that we are working with a realtor who is showing us homes.

Let's say I find a FSBO(for sale buy owner) home. I have my realtor call the owner who says that won't pay ANY commission to a realtor. My realtor calls me to fill me in on the house.

Since I've enlisted my realtor in my home search, I feel I owe them something.

I'm trying to draw an analogy between boat buying and home purchasing.

[Paul L]

If you want to pay your buyers broker something, then make a contract with them up front on how they will be compensated. A buyers broker should already have terms available for you. Otherwise they are being paid for by the seller and in the end represent the seller's best interest. If you want to compare real estate agents to boat brokers -- it is a toss up as to which group has more smooth talking, incompetent and untrustworthy individuals. The real estate side just has a lot more oversight.

[1234 Thunder]

The internet has so changed the boat broker's business model so that no one really knows what the rules are. It used to be that one relied on the broker to "know" the boats and match them up with buyers. With the internet, as you say, you do most of the searching on line. The brokers are just showing boats that they have signed up. Unless your agent is providing value other than making some phone calls, I wouldn't pay him.

[roverhi]

If you feel the broker has given you some service, pay him something. If he takes you all the way through search, inquiry, survey, sea trial, and close, at least 5%. Brokers often know what questions to ask and have some experience with the boat that you may be looking at that you won't dig up on your own. Also can be very helpful in negotiation as less intimately involved partner.

Still, if the guy has been acting as a buyer's broker for you, really surprised he hasn't put the amount of any commission down in a contract.

[imiloa]

i am a yacht broker and I'm pretty sure your broker will appreciate your acknowledgement that he has performed valuable services on your behalf. if you are looking at 25k boats listed with another broker he would be netting about $1200 at best if there was a commission split, and if he has to share it with his brokerage house it might only be half of that.
If you find a fsbo and he doesnt have to do the paperwork and attend survey, etc, he would probably be grateful for a couple hundred bucks in appreciation. If you would like him to follow through and represent you in the rest of the sale, you might consider compensating him accordingly.

Either way, good on you for being considerate of your brokers time.
Good luck!


Sent from my iPad using Cruisers Sailing Forum

[Orion Jim]

If your "buyers broker" hasn't the business acumen to contractually assure he would be compensated for his services he is in the wrong business. Whatever you decide to "tip" him is fine. Hopefully he'll use to to find work of which he is capable of performing.

[Mike OReilly]

JulieMac, at that price range you are likely far better off not dealing with any brokers if you can. If they are really in it as a business, then the potential commission off a $25k-$35k sale buys you very little of a brokers time. And to split a tiny commission just makes it even less likely you'll get the service you want as a buyer (or as a seller).

If you really need an agent to act for you I would hire them at a fixed rate. But from my personal experience as both buyer and seller in your price range I believe brokers are more of a hinderance than a help. Not b/c brokers are bad. It's simply that as business people they can only afford to give each job the amount of time/effort that its worth. At the low end the commision simply does't buy enough of the broker's time.


Why go fast, when you can go slow

[carambo46]

Most of the brokers that I've talked to in that price range have a minimum $3000
Many times the split is not 50-50
So in that range it would be between 900 hundred and $1500

[wunderluster]

I'm a broker and of course I would rather make a 100+K sale in house so the entire amount goes to my company. However, I will work with buyers looking at lower end boats and split the commission. That is the way I have built my business. I've spent many hours making a sell that resulted in less than minimum wage! Often these buyers are repeat customers when they decide to sell the older boat and purchase a larger or newer one.

I'm working with a gentlemen now who's boat I just sold for $6,900, in three days! We agreed to a flat $1,000 commission. I'm also looking for replacement boat for him where I will most likely split a commission on a 90-100K purchase. I also look for boats for sale by owner for him because we have a verbal agreement that he will pay me for my time if the seller will not "work with" a broker. I have a spent a considerable amount of time looking for the right boat for him because I know I will be compensated at some point. If you treat your broker with respect and honesty you should get the same in return. If not, find another broker.