Brokers working for boat buyers take on many clients, especially around boat-show time. This is their time to step it up, and the research they do and the boats they preview for one client can have the happy coincidence of also aiding other clients in finding a new boat.
Should boat buyers follow that lead and spread their search among multiple brokers? That’s not a good idea, says Brian Nopper, a yacht broker with HMY Yacht Sales in Dania Beach, Florida. “Just talking to too many people, they can get confused, they can’t remember who they spoke with and they get different stories,” he says. “Sometimes they get themselves in a pickle, because they may not have told you that you’re going to see a boat that they’ve already called on.” That’s not a good use of anyone’s time.
Boaters are better informed today before they even call a broker. “By the time the customer has called me, he or she knows more about the boats [listed on the Internet] that they think they want to see,” Nopper says. “They’re calling on a 38 Tiara or a 48 Viking, they know every one that’s in the market, they know every one and what their prices are, they knows how long they’ve been on the market, how many hours, they know his market segment cold.”
But brokers do more than search listings. “You need to be cognizant of what you’re doing with your deposit, and your closing—a good broker and a good brokerage house are protecting your money by way of conveying title [of the boat],” Nopper continues. “That’s paramount.”
If you’re selling your boat at a boat show, you’re probably interested to see what kind of foot traffic she gets, and the kind of people who may be interested enough to look her over—maybe you can contribute something to the conversation to help her sell. Bad idea, according to Jeff Stanley, the managing partner at Gilman Yachts in Fort Lauderdale.
“For owners, it’s probably a bad thing to sit and listen to people pick on your boat, because they do,” Stanley says. “You have to be very very thick-skinned to be a broker.” You see, it takes all kinds of buyers to see it to sell a boat, and some people just enjoy going negative.
“One guy will come on up and say ‘The interior of this boat smells terrible.’ The next person a half-hour later says, ‘It’s the best-smelling boat in the show.’ You sit there and hear it all: ‘How could they have picked these colors? These are terrible.’ Selling your boat is hard enough. There’s no need to sit and hear such comments.
“Don’t sit on your boat at the boat show,” Stanley says. “Go shop for your new boat or whatever, but don’t sit on your boat.”
If you’re reading this, you would probably call yourself a “boat guy,” and the idea of walking the docks at a show can get you excited to see boats of every stripe—including some you’d never dream of owning. That’s why finding a boat to buy at the boat show can sometimes feel like a needle in a haystack.
“Buyers can often make the mistake of viewing too much product at a show,” says Simon Gibson, a partner and broker at Worth Avenue Yachts in Palm Beach, Florida. “For a buyer to come down to the boat show and view 20 boats in one day, it’s very tough to take in and retain the amount of information that’s on display, which makes it hard to get a clear picture of exactly what it is that you’re trying to achieve.”
The bottom line is that the boat show should function more as the playoffs than the regular season. The regular season goes something like this: “We prefer to be prepared in advance; a few weeks before the boat show, we will e-mail a list of the yachts going into the show,” Gibson explains. “We will update it as the show gets closer. We’ll then do a conference call with the client, and weed out the yachts that really either don’t make sense in terms of price, layout, age or style. So what we do is come down to a short list that is manageable.” On that short list are the boats that you will end up seeing at the show.
Your hard work pays off. You’re only seeing boats that fit your criteria—though you can be as strict or as loose as you like leading into that. “It should be noted that this is supposed to be fun,” Gibson says. “Slowing the process down, spending your time on fewer boats, enjoying lunch, going out and doing a few more boats, and weeding down the list even more is a much more enjoyable way of doing things.”
Many boat buyers don’t understand the commissions that are paid in the transaction of buying a boat. It’s a common problem, since the only person who loses out is a buyer who does a deal without his own broker—thinking he’s going to save money.
“Buyers often want to go directly to a listing broker and take out the selling broker,” says Tom George, president of the Tom George Yacht Group and a Certified Professional Yacht Broker (CPYB). “The buyer doesn’t pay a dime more by having his own broker. It’s paid by the seller. So either the listing broker is going to make the commission or it’s going to get split between his broker and the listing broker.”
Since the seller pays the same amount of commission either way, it doesn’t affect the cost of the boat for the buyer. So if you’re not saving money, what good does it do not to have your own broker? The answer is not much. “There are so many things that the buyer’s broker can assist with, from recommending the best and most qualified surveyor to knowing what to ask for in a survey review to managing survey deficiencies to closing paperwork and proper protocol,” George says. “It’s to the buyer’s advantage to have a guy on his side, working for him. Otherwise it’s like walking into a courtroom without an attorney.” And as frightening as that sounds it happens all the time—whenever buyers call the listing broker directly.
The buyer’s broker is a key part of any good deal. “We’re there to represent the client,” George says. “And try to protect him as best as we can.”
The U.S. Coast Guard’s motto Semper Paratus means “Always Ready” and it’s a good one to keep in mind in all boating situation. But you’d be surprised at the number of boaters who don’t follow that advice at boat shows where they hope to make a deal.
“People are there at the boat show to sell boats,” says Chuck Royhl, a broker with Sarasota Yacht & Ship. “Sellers and companies have spent lots and lots of money to get the boat spiffied up and bring it to the boat show, and they’re serious.” This is business after all, and sometimes large boats and large sums of money are at play.
“If you want to be taken seriously as a buyer, you’d better bring a check,” Royhl says. “And that’s when you’re going to get peoples’ undivided attention, is when you are ready to stroke a check for that deposit. This is the fish or cut bait time, sports fans.” It may seem obvious, but Royhl, a certified professional yacht broker, contends that this problem is more common than you might think. And it actually has repercussions beyond the inconvenience at the time.
“Buyers often forget to bring their checkbook, some intentionally, some not,” Royhl says. “If they bring a check to the boat show, it not only reinforces in their own head why they’re going to the boat show, but it makes it clear to those who they’re trying to negotiate with. If you don’t have a check with you, don’t expect to be taken seriously.”
But it’s not just any check. You need to be ready to make out the check for the amount on the spot: “Ten percent of the price is the standard deposit,” Royhl says. “That’s what it takes to get a boat off the market. If somebody shows up with a better offer, they’re going to have to wait until you accept or reject the boat.”
A cashier’s check predrawn in a set amount is not the answer, either. “There are a couple of times when I have had people come into a boat show saying they’re going to show up with, say, a million dollars,” Royhl says. “They’re ready to write that. And they will show up with a cashier’s check made out for $100,000, thinking they’re going to get a $1.5 million boat for a million because they’ve shown up with this. That’s a game—a game that serious sellers with real boats are not going to play.”
Boats are great fun, but buying and selling them is not a game. Show up ready to deal and you will be treated the same way. “If you bring your checkbook, you show up ready to negotiate you will be taken very seriously at a boat show,” Royhl says. “And there is the opportunity to get a great deal at a boat show, if you do that.”