Question about Brokers

[Bacchus]

I absolutely plan on seeing the boat in person, I just don't want to have to make trips to see boats that are a waste of time. My tentative plan is something like this:
1) If I see a boat that looks good, hire a local surveyor to give a the vessel a quick look-see. Not a complete survey, but just confirm whether their are any obvious issues.
2) If it looks OK, after entering contract with seller, have surveyor come out for a complete survey.
3) If it still looks good, travel to boat for in-person sea trial and sale.

Does that sound reasonable?

BTW, both my wife and I got our RPBA single-engine certification last summer.

Kelly
Food for thought only
List looks reasonable... only comment I'd make is you might want to weigh the order and costs for #2 & #3. Surveys can get expensive if you do many and I'm not sure I could commit that expense when I hadn't even seen the boat. Maybe if I'd been aboard an identical boat locally and knew it would work for you need / wants.
I guess lots of photos / video from owner/ seller would help.
Usually / at least boats I've bought the sea trial was part of the survey. There would likely be an additional $ for 3rd trip for the surveyor.

I think what many distant buyers do is try to line up several good candidates and schedule them around one trip. Then they go further (full survey) with the leading contender. With older boats many have both a hull survey and and engine (mains & gen) surveyed by a mechanic familiar with that engine.

To the extent possible try to make the hunt enjoyable vs a dreaded task. When we decided on our current boat make / model we did it as a mini vacation with several days travel including a boat show and looking at multiple boats by a couple brokers. When we got aboard the Mainship 34 HT both wife & I felt it checked pretty much all of our musts & wants but was in poor condition. DW said just find one in better shape. After searching online I got a contract through buyers broker and flew to TX to inspect it and close the deal. I was able to do N it in one trip but knew exactly what we wanted, had been aboard one and the candidate was only 4 yrs old and had less than 150 hrs on eng & gen. The purchase trip was about 4-5 days but only had to travel once.

 

[Flyguy1967]

In Portland, I would call Jim Taylor at Irwin Yachts. I bought my boat from him and he was great.

 

[Seevee]

I absolutely plan on seeing the boat in person, I just don't want to have to make trips to see boats that are a waste of time. My tentative plan is something like this:
1) If I see a boat that looks good, hire a local surveyor to give a the vessel a quick look-see. Not a complete survey, but just confirm whether their are any obvious issues.
2) If it looks OK, after entering contract with seller, have surveyor come out for a complete survey.
3) If it still looks good, travel to boat for in-person sea trial and sale.

Does that sound reasonable?

BTW, both my wife and I got our RPBA single-engine certification last summer.

NO.
I might argue to get everything done that doesn't require a lot of dollars, title search, maintenance records, detailed equipment list, with part numbers, serial numbers and age, detailed pictures. And, yes, get a local (preferable a surveyor) to do a walk thru to see anything obvious. Have him and a mechanic standing buy, if you can, for your trip to see it.



Go see it, make your offer after you've looked carefully, taken a short run in the boat, and verified that most of what you're looking at works. In a few hours, you can test the generator, anchor, AC units, galley appliances, head, etc., etc. Talk price and terms. Make you offer and if accepted, reduce it to writing. Have your surveyor and mechanic who are standing by do their thing. Write the guy a check and get the title. Make it short and fast in the end, if you can. You can often do this without a deposit and close within a day.



The goal being.... you've already determined that this boat and model is something you want. You are only verifying that it is in the condition that you expect. You've done everything else.

 

[DavidM]

"Go see it, make your offer after you've looked carefully, taken a short run in the boat, and verified that most of what you're looking at works. In a few hours, you can test the generator, anchor, AC units, galley appliances, head, etc., etc."

In my day, no seller would allow a prospective purchaser to start the engine, take the boat out for a short spin, run the generator......

Only after a contract was signed and a deposit received would the seller start the engine, take it out for a seatrial, etc. The seller was allowed to steer the boat and see how it handled, but the seller was the captain or his designated representative.

David

 

[Seevee]

"Go see it, make your offer after you've looked carefully, taken a short run in the boat, and verified that most of what you're looking at works. In a few hours, you can test the generator, anchor, AC units, galley appliances, head, etc., etc."

In my day, no seller would allow a prospective purchaser to start the engine, take the boat out for a short spin, run the generator......

Only after a contract was signed and a deposit received would the seller start the engine, take it out for a seatrial, etc. The seller was allowed to steer the boat and see how it handled, but the seller was the captain or his designated representative.

David

David,


Hope you're kidding. Sounds like a seller that doesn't want to sell.



I've done that with the last 20 boats I've purchased... no contract, no deposit for the most part. However, yes, I pay for the costs, but often refused. If one is going to spend $200k on a boat, the LEAST thing a seller could do is take him for a ride and show him that things are working.

However, if I can't arrange a survey/inspection or there's work the PO must do, I will put down a deposit with the offer, held by my rep, or the seller, depending. Never a problem, however. Yes, I've passed on a few unscrupulous brokers that don't want to sell boats.

 

[Bacchus]

Larry
What you described may work with private sales but not normal for a brokered boat. Often the owner is not even present for initial showing and I haven't met a broker that would take an owners boat "for a spin".
I wouldn't classify a broker that won't take a sellers boat out for a spin as unscrupulous. Likewise I wouldn't consider sellers that refuse brokers from taking their boat out as not wanting to sell.
It may be more common in your circles. / travels but not where I have been.

 

[FF]

Working on cleaning out my nautical library I found a 1961 Yachting , that reminded me what brokers USED to do for 1/10 of your boat.

A broker would come to the boat , make a list of installed items ,write a listing, photo the boat , and then pay for adds in magazines like Yachting.

He would have duplicates of the photos made, and send them to inquiring folks.

Usually a 2-3 month delay before the add was in the magazine.


Today a broker probably spends little putting owner photos on the net and still wants 10%.


INSANE!

 

[Judy at JWY]

"...Today a broker probably spends little putting owner photos on the net and still wants 10%.
INSANE!"

I have kept my fingers under control and refrained from contributing to this thread, but alas, FF forced me to break down my resistance. So it is insane for a broker to get 10% for posting owner pictures to a website? Does your doctor get paid for the 15" s/he spends with you? The commission for your stock broker to execute a trade?

A yacht owner is paying a broker for their knowledge, experience, wisdom, and guidance in your particular situation.

As a listing broker, the duties include advising the seller of how to make the boat more salable (no, I don't mean staging but that does actually help.) Knowing what information to obtain for writing the listing. Writing the listing for what is most appealing to buyers. Paying YachtWorld to host the listing with the potential for hundreds of thousands of readers (my outrageous monthly fee is $1,000). Fielding the calls and knowing the questions to ask to filter through the tire-kickers. All of that before the broker takes on the experience and responsibilities of the paperwork and escrow for contract and closing. None of this is even addressing the time involved.

As in any field, there are good ones and bad ones. What I don't understand is the general disdain for yacht broker earning anywhere from 2.5 - 10% for a accomplishing the sale of a yacht. We're not ripping you off. We're not selling coffins. We are helping you fulfill a dream in a professional and honorable way with huge responsibility in more than just fiscal aspects. Please don't begrudge us the commission on those boats that do actually close compared to the buyers and sellers that never eventuate compensation in the end.

 

[mvweebles]

"...Today a broker probably spends little putting owner photos on the net and still wants 10%.
INSANE!"

I have kept my fingers under control and refrained from contributing to this thread, but alas, FF forced me to break down my resistance. So it is insane for a broker to get 10% for posting owner pictures to a website? Does your doctor get paid for the 15" s/he spends with you? The commission for your stock broker to execute a trade?

A yacht owner is paying a broker for their knowledge, experience, wisdom, and guidance in your particular situation.

As a listing broker, the duties include advising the seller of how to make the boat more salable (no, I don't mean staging but that does actually help.) Knowing what information to obtain for writing the listing. Writing the listing for what is most appealing to buyers. Paying YachtWorld to host the listing with the potential for hundreds of thousands of readers (my outrageous monthly fee is $1,000). Fielding the calls and knowing the questions to ask to filter through the tire-kickers. All of that before the broker takes on the experience and responsibilities of the paperwork and escrow for contract and closing. None of this is even addressing the time involved.

As in any field, there are good ones and bad ones. What I don't understand is the general disdain for yacht broker earning anywhere from 2.5 - 10% for a accomplishing the sale of a yacht. We're not ripping you off. We're not selling coffins. We are helping you fulfill a dream in a professional and honorable way with huge responsibility in more than just fiscal aspects. Please don't begrudge us the commission on those boats that do actually close compared to the buyers and sellers that never eventuate compensation in the end.

Thanks for chiming in Judy. I agree there are brokers at every grade of professionalism. I think part of the perception issue is many brokerages hire wannabes, probably because the broker perceives there is no cost if the wannabe washes out. In general, Sales is a tough job that requires special skills so that it looks so easy when done well - looks as easy as just posting pictures.

As someone who met you almost 20-years ago at a couple Trawler Fests it's good to see you're still around. I applaud your commitment to the industry and trawlers. Thanks for your contributions to TF.

Peter

 

[Seevee]

"...Today a broker probably spends little putting owner photos on the net and still wants 10%.
INSANE!"

I have kept my fingers under control and refrained from contributing to this thread, but alas, FF forced me to break down my resistance. So it is insane for a broker to get 10% for posting owner pictures to a website? Does your doctor get paid for the 15" s/he spends with you? The commission for your stock broker to execute a trade?

A yacht owner is paying a broker for their knowledge, experience, wisdom, and guidance in your particular situation.

As a listing broker, the duties include advising the seller of how to make the boat more salable (no, I don't mean staging but that does actually help.) Knowing what information to obtain for writing the listing. Writing the listing for what is most appealing to buyers. Paying YachtWorld to host the listing with the potential for hundreds of thousands of readers (my outrageous monthly fee is $1,000). Fielding the calls and knowing the questions to ask to filter through the tire-kickers. All of that before the broker takes on the experience and responsibilities of the paperwork and escrow for contract and closing. None of this is even addressing the time involved.

As in any field, there are good ones and bad ones. What I don't understand is the general disdain for yacht broker earning anywhere from 2.5 - 10% for a accomplishing the sale of a yacht. We're not ripping you off. We're not selling coffins. We are helping you fulfill a dream in a professional and honorable way with huge responsibility in more than just fiscal aspects. Please don't begrudge us the commission on those boats that do actually close compared to the buyers and sellers that never eventuate compensation in the end.

Judy,
There's a reason that brokers get a bad reputation and their commissions seem too high for a lot of us. And that goes for real estate, aircraft and car sales.
There's just a lot of people in that business that think there's an easy buck to be made without a lot of work. It really takes a self starter to succeed, which not all people are.
So there's a mix of competence, different standards, laziness, and a lack of knowledge, so it's hard to find a good sales person.

Also, most of the marine industry is unregulated which doesn't help.

Granted, there sure are good brokers out there.... just a bit of work to find them.

 

[Judy at JWY]

Thanks, Peter, your kind words and support are always appreciated. I'm hesitant to post when it comes to broker discussions and especially when I feel the need to take the defense tack. Your comments and wisdom are always reassuring.

 

[Judy at JWY]

Seevee -- good points made and noted. As to work in finding good brokers, you have a great resource: TF! I have frequently seen recommendations for brokers by owners on this forum who report good experiences, good enough that they make a public recommendation. Making a post for recommendations and then doing your basic due diligence doesn't seem like a big deal.

Send me a PM if you want me to suggest the interview questions to ask a broker before engaging.

 

[AlanT]

I would never buy real estate without a broker. I would, however, buy a FSBO boat as I would almost assuredly know what I was looking for. That said, my observations of people who sell FSBO is they often over price their boat or property.

Peter

Good point Peter. As a corollary, I have experienced this myself as the seller wanting to sell at $X and having my broker have to 'talk me down' to a realistic price using his experience and his access to the YW database of recent sales. This brings me to my point. One advantage of involving a broker as a buyer is that he/she is able to access this same database and with any mass produced boat should be able to let you know the price range for that boat in various states of condition. When buying an FSBO it becomes your job to talk the seller down. This can be hard without data.
~A

 

[slowgoesit]

Go see it, make your offer after you've looked carefully, taken a short run in the boat, and verified that most of what you're looking at works. In a few hours, you can test the generator, anchor, AC units, galley appliances, head, etc., etc. Talk price and terms. Make you offer and if accepted, reduce it to writing.

This would be wonderful, if a broker, or owner would actually agree to it! Having said that, none of the boats we looked at, both FSBO, as well as broker represented, would have allowed all this (or pretty much ANY of it) until there was a signed contract, and earnest money in escrow . . . but perhaps we are traveling in different circles?

 

[catalinajack]

Seevee -- good points made and noted. As to work in finding good brokers, you have a great resource: TF! I have frequently seen recommendations for brokers by owners on this forum who report good experiences, good enough that they make a public recommendation. Making a post for recommendations and then doing your basic due diligence doesn't seem like a big deal.

Send me a PM if you want me to suggest the interview questions to ask a broker before engaging.

The problem I have with boat brokers is their intransigence about the 10% commission amount. Yes, you make very good points about your experience and the time invested. But, you must admit that the effort to advertise is much less than in pre-internet days and digital photography and, yet, the 10% commission persists. That, I believe, is the reason you are seeing so much bashing of brokers. In the real estate industry there is rate competition. Whereas the going rate used to be 6% and non-negotiable it is common find competent RE brokers and agencies selling for a 4% commission. And, the challenges and work involved in completing a real estate sale are far higher, including being licensed, passing a rigorous test, and subject to continuing education requirements which is totally absent in the boat broker world. So, yes, 10% is a ridiculous amount especially in today's market in which sales by owner is quite easy. Brokers would get many more listings if the fee were lower, say 6 or 7%. But, as long as brokers continue to cling to their outdated fee structure, they will continue to suffer a lack of listings. Add to that the ease with which a boat can change hands privately, as opposed to real estate transfers, with respect Judy, the broker industry is killing itself.

 

[Stabi]

Would you listen to a product review from someone who has never used that particular product. The Insurance Broker who posts on this forum gets Rave Reviews from people who have used his services, myself included, honest individual who works hard for his clients.
When it comes to Boat Brokers, ONLY take the recommendation from someone who has actually used that particular Broker. All Brokers WANT to come across as someone who has your interests at heart, this is not always the case, their commission can trump your interest. It once happened to me that a boat was advertised to be in Seattle. Being interested in that particular boat I contacted the broker. Turns out the boat was not in Seattle, rather in Port Townsend. I asked a friend in Pt Townsend if he knew of that boat before traveling to see it. He informed me that not only did he know of the boat, but knew the owners quite well and would have them contact me. They did, and later, I then got the phone call from hell from the broker calling me everything but a milk cow because I talked to the owners directly. They called me! The owners had placed a FSBO listing in Passagemaker, and the broker called them wanting the listing. That particular broker from a totally different location, had never seen the boat and knew nothing about that boat yet wanted a sales commission for placing an ad. I did not buy that boat so the commission was mute, but I will never forget that phone call.

 

[ranger58sb]

The problem I have with boat brokers is their intransigence about the 10% commission amount.
But, you must admit that the effort to advertise is much less than in pre-internet days and digital photography and, yet, the 10% commission persists.

So, yes, 10% is a ridiculous amount especially in today's market in which sales by owner is quite easy.

I suspect advertising costs have gone UP compared to "the old days." Partly because Yachtworld (I'm told) charges an arm and a leg for membership each month, advertise or not. And I guess YW feels justified in doing that partly because they can reach a much larger market than would a regional boat mag here and there... but also its not cheap to run a website-cum-database.

Used to be 2-3 pics in a print ad were about all you got. Today, a decent YW listing may have 100 pics with recent time-stamps visible. Yes, individual pics are cheaper, but not less difficult to stage/crop/etc.

Looks like some of the brokerages are still sorta expected to advertise in the national boat magazines too (P&MY, Yachting, etc.), maybe whether they like it or not. Aside from looking at the pretty pics (one for a given boat) in the advertising sections in the back... who actually buys a boat from one of those?

(I don't even want the "free" magazine -- to inflate their market "size" -- but haven't successfully turned it off yet. Came close a couple times, but the damn thing reappears after a while...)

-Chris

 

[Seevee]

This would be wonderful, if a broker, or owner would actually agree to it! Having said that, none of the boats we looked at, both FSBO, as well as broker represented, would have allowed all this (or pretty much ANY of it) until there was a signed contract, and earnest money in escrow . . . but perhaps we are traveling in different circles?

Perhaps, but don't understand how someone can even make an offer, let alone buy a boat without most of this info. Fortunately, I've always been able to get the info I need, and often talk with the owner on listed boats.

 

[Seevee]

Would you listen to a product review from someone who has never used that particular product. The Insurance Broker who posts on this forum gets Rave Reviews from people who have used his services, myself included, honest individual who works hard for his clients.
When it comes to Boat Brokers, ONLY take the recommendation from someone who has actually used that particular Broker. All Brokers WANT to come across as someone who has your interests at heart, this is not always the case, their commission can trump your interest. It once happened to me that a boat was advertised to be in Seattle. Being interested in that particular boat I contacted the broker. Turns out the boat was not in Seattle, rather in Port Townsend. I asked a friend in Pt Townsend if he knew of that boat before traveling to see it. He informed me that not only did he know of the boat, but knew the owners quite well and would have them contact me. They did, and later, I then got the phone call from hell from the broker calling me everything but a milk cow because I talked to the owners directly. They called me! The owners had placed a FSBO listing in Passagemaker, and the broker called them wanting the listing. That particular broker from a totally different location, had never seen the boat and knew nothing about that boat yet wanted a sales commission for placing an ad. I did not buy that boat so the commission was mute, but I will never forget that phone call.

And that's the kind of broker that gets the reputation. I'd probably mention his behavior to the seller.

 

[ManoBoat]

The problem I have with boat brokers is their intransigence about the 10% commission amount. Yes, you make very good points about your experience and the time invested. But, you must admit that the effort to advertise is much less than in pre-internet days and digital photography and, yet, the 10% commission persists. That, I believe, is the reason you are seeing so much bashing of brokers. In the real estate industry there is rate competition. Whereas the going rate used to be 6% and non-negotiable it is common find competent RE brokers and agencies selling for a 4% commission. And, the challenges and work involved in completing a real estate sale are far higher, including being licensed, passing a rigorous test, and subject to continuing education requirements which is totally absent in the boat broker world. So, yes, 10% is a ridiculous amount especially in today's market in which sales by owner is quite easy. Brokers would get many more listings if the fee were lower, say 6 or 7%. But, as long as brokers continue to cling to their outdated fee structure, they will continue to suffer a lack of listings. Add to that the ease with which a boat can change hands privately, as opposed to real estate transfers, with respect Judy, the broker industry is killing itself.

This perspective hits home for me especially the point on the lack of regulation and therefore lack of accountability, even with higher prices like a home, the industry acts like it's a $100-$200k used car sale.

I believe there are top notch brokers out there and they may do a lot but lets face it, they are paid by the seller. The only real protections a buyer has are his personal skills in not getting screwed.

Even a buyers broker is completely incented to help the seller/selling broker close the deal. Again I'm sure some care about their reputation or their agency demands quality work.

 

[Judy at JWY]

I always wince when a boat buyer or seller compares yacht sales to real estate. Keep in mind that houses don't move. Selling a boat doesn't just mean trips to the boat, but the sea trial and survey. How many plane tickets does a real estate agent buy each year on behalf of clients? How much time does the agent spend on inspection? A boat usually takes 2 days for a survey, even some 40 footers. That frequently means hotel room in additional to plane tickets and rental cars. More importantly is the knowledge a broker brings to the survey. I've yet to hear a real estate agent insist on an audiogauge or discuss blisters or doublers or exhaust systems with an inspector.

Comparing real estate agents and yacht brokers isn't even apples and oranges.

 

[costalive]

Good point Peter. As a corollary, I have experienced this myself as the seller wanting to sell at $X and having my broker have to 'talk me down' to a realistic price using his experience and his access to the YW database of recent sales. This brings me to my point. One advantage of involving a broker as a buyer is that he/she is able to access this same database and with any mass produced boat should be able to let you know the price range for that boat in various states of condition. When buying an FSBO it becomes your job to talk the seller down. This can be hard without data.
~A

AlanT

This is prpbably a stupid question but how do I locate "YW database of recent sales" that you speak of. I have looked throught their site and can not find it.


Thx inadvance

 

[Alaskaflyer]

AlanT



This is prpbably a stupid question but how do I locate "YW database of recent sales" that you speak of. I have looked throught their site and can not find it.





Thx inadvance

Not available to us lowly consumers of listings.

 

[Judy at JWY]

"... how do I locate "YW database of recent sales""

I would be willing to help out here and there.

 

[Judy at JWY]

Here's an idea:

Get a few of you FSBO guys together. To sign up for YW, you need to have 2 or 3 listings. So pay YW +/- $1,000, list your boats, do your own market research, take your own calls and then after they sell, cancel YW. Oh, and don't forget to check the box that says "not available for co-brokerage."

 

[mvweebles]

Question for you Judy. I'm one of this guys who do not negotiate 6% commissions, but I do negotiate service to assure I'm getting extras such as ads and open houses. I just feel the full commission will motivate brokers. But I do negotiate that the 6% is paid on net proceeds after all adjustments, sellers tax stamps, repairs, etc.. Without divulging too much, any guidance on what is negotiable for, say, boats in the $500k range?

Peter

 

[catalinajack]

Here's an idea:

Get a few of you FSBO guys together. To sign up for YW, you need to have 2 or 3 listings. So pay YW +/- $1,000, list your boats, do your own market research, take your own calls and then after they sell, cancel YW. Oh, and don't forget to check the box that says "not available for co-brokerage."

Judy, I tried to make a good case for 10% commission being excessive and I believe I did so. You say comparing to real estate is apples to oranges. I call bull poop. Real estate agents work far harder and can have many more "dry holes" than boat brokers do and yet today's commission is generally 4% and never mind the testing, licensing, and continuing education requirements you so conveniently choose not to address. But, yes, go ahead and cling to your outdated business model and then wonder why so many owners are more and more choosing to market their own boats and quite successfully I might say say. Ten per cent in today's business environment is outrageous. Do you really think real-estate agents don't incur MLS expenses similar to your Yacht World access fees. Wake up girl, the market is leaving you behind.

Judy, truly, I would consider engaging a broker for a 6% commission but at 10% I will market my boat myself. By the way, my mother, a single mother, supported her family for 30 years as a real estate agent so I do know a bit about both markets.

 

[BruceK]

Interesting. Real Estate Agents here charge around 2% incl gst but it`s negotiable, and if they list a property in today`s market it sells,fast. Decent boats are similar at present but brokers want 10%. Though the one I used 2 years back was 8%(not why I chose him),and adjusted it down of his own volition when it sold.
10% seems excessive for work done. I`m not surprised people look for alternatives. It makes zero sense, especially when you compare it to what a RE Agent does. FWIW I spent 2 post retirement years working in Real Estate in a way tougher market than we have now.

 

[Judy at JWY]

Peter -- I'm not quite sure of your question. As a buyer, you pay nothing as the seller is the one who pays the commission. So let's discuss someone looking to sell their $500,000 boat and what do they get for it and what is negotiable. I am going to talk "in general" but of course there are always exceptions.

Brokers present a Central Listing agreement that calls for a 10% commission. The Listing Broker handles everything related to the listing and sale of the vessel. All other brokers call the Listing Broker for information, appointments, courtesy showings, etc. One reason the commission is 10% is because it is split 50-50. As an owner, you want your broker to encourage other brokers bringing their clients. So a 50/50 split that is reduced is going to effect the Selling Broker. Bottom line is if I am working as Buyer's Broker and 2 identical boats are listed, am I going to call the broker with a 10% listing that is industry standard or am I going to call the broker where I am going to get less than 5% because he cut a deal with his owner?

I don't know any successful, reputable brokers that cut their commission. If it is my client to whom I sold the boat, then sometimes I will cut it a bit on resale, but keep the other brokers at their expected 5%. I have gone as low as 8% if it is a repeat, repeat client. But if another broker is involved, that means I only make 3% so I usually tell the seller that it's the reduced commission only if it is my sale on both sides.

When I will cut my commission is if it is to keep the deal together after sea trial and survey and we are having a problem on the renegotiated price. I call it giving up commission for the psychological factor, for keeping the buyer and seller on good terms. But I have to tell you that when someone is selling their half-million dollar boat, and someone is buying a half-million dollar boat, then why am I, the blue collar working stiff, the one to give up the money? But sometimes, you do whatever it takes to make everyone happy and still be considered fair.

So Peter, you can tell that I'm not offering much advice on what to negotiate off of the 10% if you are referring to listing a boat. I don't think it is to your advantage. You should expect your broker to give you and your boat 100% of their attention. Suggestions for pricing, for making her more showable, communicating on the traffic, providing feedback from showings, and getting you to the point of contract. Then the expertise in negotiating and people skills become critical. Handling the sea trial and survey, which really means keeping the seller (who is usually the skipper in our genre) calm and on target, dealing with discussions of survey items, etc.

I have given very honest thoughts in this post even at the risk of shooting myself in the foot. The international industry standard for yacht sales is 10%. It does get lower when dealing in the megayacht realm and further reduced in the superyacht world. For someone having trouble with the 10%, try reframing: "you get what you pay for" or "the price of boat ownership" or "I've turned the sale over to a professional" or do whatever you need to do to make selling your boat a part of the good memories of your ownership.

For the broker naysayers: Out of the approximate 300 trawlers I have sold, I don't think you will find one buyer nor seller that didn't think I earned my commission.

 

[catalinajack]

Peter -- I'm not quite sure of your question. As a buyer, you pay nothing as the seller is the one who pays the commission. So let's discuss someone looking to sell their $500,000 boat and what do they get for it and what is negotiable. I am going to talk "in general" but of course there are always exceptions.

Brokers present a Central Listing agreement that calls for a 10% commission. The Listing Broker handles everything related to the listing and sale of the vessel. All other brokers call the Listing Broker for information, appointments, courtesy showings, etc. One reason the commission is 10% is because it is split 50-50. As an owner, you want your broker to encourage other brokers bringing their clients. So a 50/50 split that is reduced is going to effect the Selling Broker. Bottom line is if I am working as Buyer's Broker and 2 identical boats are listed, am I going to call the broker with a 10% listing that is industry standard or am I going to call the broker where I am going to get less than 5% because he cut a deal with his owner?

I don't know any successful, reputable brokers that cut their commission. If it is my client to whom I sold the boat, then sometimes I will cut it a bit on resale, but keep the other brokers at their expected 5%. I have gone as low as 8% if it is a repeat, repeat client. But if another broker is involved, that means I only make 3% so I usually tell the seller that it's the reduced commission only if it is my sale on both sides.

When I will cut my commission is if it is to keep the deal together after sea trial and survey and we are having a problem on the renegotiated price. I call it giving up commission for the psychological factor, for keeping the buyer and seller on good terms. But I have to tell you that when someone is selling their half-million dollar boat, and someone is buying a half-million dollar boat, then why am I, the blue collar working stiff, the one to give up the money? But sometimes, you do whatever it takes to make everyone happy and still be considered fair.

So Peter, you can tell that I'm not offering much advice on what to negotiate off of the 10% if you are referring to listing a boat. I don't think it is to your advantage. You should expect your broker to give you and your boat 100% of their attention. Suggestions for pricing, for making her more showable, communicating on the traffic, providing feedback from showings, and getting you to the point of contract. Then the expertise in negotiating and people skills become critical. Handling the sea trial and survey, which really means keeping the seller (who is usually the skipper in our genre) calm and on target, dealing with discussions of survey items, etc.

I have given very honest thoughts in this post even at the risk of shooting myself in the foot. The international industry standard for yacht sales is 10%. It does get lower when dealing in the megayacht realm and further reduced in the superyacht world. For someone having trouble with the 10%, try reframing: "you get what you pay for" or "the price of boat ownership" or "I've turned the sale over to a professional" or do whatever you need to do to make selling your boat a part of the good memories of your ownership.

For the broker naysayers: Out of the approximate 300 trawlers I have sold, I don't think you will find one buyer nor seller that didn't think I earned my commission.

OMG, Judy, there is so much to unpack in this, your latest post.

1. So what, you may have to split a commission. The same is done in the real estate industry where the commission is commonly 4-5% and the work required to complete a sale is far more involved. Give me a break.
2. No one reputable cuts a commission? Are you really suggesting that someone who does is disreputable? Really?
3. The international standard is 10%? So damn what. The real estate standard for decades was 6% until it wasn't. Ten per cent is not a law. Pretty much it is just collusion among those in the industry.
4. You have sold 300 boats. How could you possibly know that every one of them thought they got their money's worth. Could it not be that your customer's were just stuck with a rigged system, left with no other choice?
5. Yachtworld - it is a lousy place to search for a boat. For the most part the descriptions are cryptic. Yeah, call the broker and IF one gets a return call, the customer will get very little more in the way of detail. To hell with Yachtworld.
6. I have no way of knowing and you would have no way knowing either but it is my guess that, today, more boats are exchanged in private sales rather than through a broker. That is especially likely when it comes to brands such as Krogen, Selene, DeFever, Monk, Mainship, and perhaps others where boats pass hands through ads posted on their respective owner's associations. The primary driver? The 10% commission.

The incentive to go private sale is very strong. A couple of months ago, I casually mentioned the Great Loop forum that we were THINKING about selling our DeFever. Recently, we hosted an interested buyer who drove nearly 400 miles to see our boat. Another DeFever owner recently posted his boat for sale. The exchange took place just six weeks later. So, again, cling to your outdated business model. You or any other broker who insists on a 10% commission won't get my boat for sale. Until brokers start reducing their ridiculous demand for a 10% commission they will continue to lose out on listings, mine included. Boat buyers and sellers have learned to navigate the system without the need for a broker. That will only increase in the future. The internet is a wonderful thing, is it not?