Buying, Selling and Chartering
Buying a Boat
Second to a home, buying a yacht may be the largest purchase you ever make!A serious financial committment where a reputable yacht broker can prove most valuable.
Buying your boat is an emotional time for sure, and that's to be expected. ("Are we having fun yet?")
Be clear on your objectives before beginning your search.
Are you ready for that extended cruise somewhere or do you have to be back in the office Monday morning?
If you are going offshore with the family you must consider a boat large and heavy enough to be safe at sea. If entertaining friends and clients is a consideration, then layout and cabin arrangement may be priority. A full-beam saloon makes all the difference in the world while entertaining.
When most of your cruising time is with six or eight people, then comfort and number of staterooms, size and work space in the galley, and a large seating area in the saloon are all important.
Is speed a factor? Then weight and design become important. Power sportboats for example, living space may run second to performance.
Every yacht is a compromise. What you gain in one area is most surely lost in another. Adding accommodations might affect performance. Add power and you increase fuel consumption.
Once you have determined the use, consider the cost. The initial cost of the boat may fit your budget but the on-going cost of yearly maintenance must be taken in to the equation. Some so called "great buys" end up costing more than the standard quality yachts in any given class because of on-going repairs. Boats with second-rate woodwork are prone to dry rot and continuing repairs as well. If the materials used do not hold up to salt water or sun exposure the repair work may cost more than the original building process! Even boats built by famous name builders using quality materials may require expensive maintenance. A large exterior area of varnished mahogany or teak is a good example.
How do I find a vessel that will have good resale value?
Of course, resale value is most important so you will need to know what similar boats have sold for over the last year. Your broker will assist you with that. Remember, asking prices do not always determine the real market for a particular boat. Explain to your broker you want a boat that is in demand through reputation for quality and design.
Professional feedback is always your best bet.
Can you save money by not using a broker and dealing directly with the owner?
You may answer an owner ad and find a boat at what you think is a fair price and go through negotiations directly. That usually involves considerably more time and research, and at times, in the end and simply put, the so-called "savings" weren't worth the hassels.
Marketing Fees, which under the law cannot be set, are usually around 10 percent. Listing and selling brokers, as in real estate transactions, will split the fee.
How do I choose a broker?
You are spending a large amount of money. How do you choose a lawyer, banker, or any other professional?
Talk to boat owners, surveyors and marine mechanics. Talk to the brokers themselves.
It is ideal to end up with one broker, - a professional broker working full time for your interest.
Keeping many brokers at arm's length and playing one against the other will only result in no one giving you the proper time and attention you need. You cannot buy a boat the same way you buy a car - going from dealership to dealership to see who has the best price; Yacht Brokerages that are members of the BC Yacht Broker's Association work with each other all the time.
How can I find the right boat at the right price?
At this point we assume you are working with an informed broker. He will already have a good handle on his market through his computer network, industry and owner contacts, etc. Now he has to match the available boats to your needs.
The history of the boats and their ownership; the boat's record of maintenance; the gear, electronics, machinery equipment and engine; the design (good design costs no more than an inferior one); its performance with its present engines; the quality of construction; the potential resale price years later. All these factors should be included in your decision.
As for price, it is the broker's responsibility to present the offer for the buyer and negotiate an acceptable price for the seller. A broker is obligated to put forward any offer the buyer makes.
Who does the broker represent, the buyer or seller?
A broker should not represent both without making a full disclosure.
To best answer this question, remember the following: When a broker represents the seller it is his job to attract potential buyers. When a broker represents a buyer, it is his job to find the best value within the parameters listed by the buyer.
When a broker ends up representing both, he will most likely represent the buyer and let the seller accept or not accept offers at his own discretion. The best thing to do is ask and make sure you clearly understand the broker's position.
What are the proper closing procedures?
When you are ready to make and offer on a particular boat the broker will ask you to sign a purchase agreement and will require a deposit check for 10 percent of the offer to be held in the broker's escrow account.
Your broker will commence negotiations with both parties. The purchase agreement should allow the buyer approximately 10 days to perform sea trials and survey the boat. If he rejects the boat within the 10-day period for example, he receives his deposit back, no exceptions. He may reject the boat for any reason including just changing his mind. However, if he accepts the boat by removing all subjects, and does not close, he will forfeit his deposit.
The buyer pays the cost of surveying and hauling. Choosing a competent surveyor who is independent of seller and broker is important. Survey items that need repair can be negotiated as well, except when the purchase price is substantially lower than the asking price, or when the expense of new items changes the value of the boat.
All registered and documented boats should be sold clear of all liens and be checked accordingly.
This process is a simplification but should leave you better prepared as you continue your search.
Fractional Ownership
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Grand Yachts Inc.
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Grand Yachts, Inc. Vancouver Office 1535 Coal Harbour Quay Vancouver, BC V6G 3E7, Canada Toll-free 877-822-0358 Tel 604-687-8943 Fax 604-687-8948 Email Us |
Grand Yachts Inc. Sidney Office Sidney, BC V8L 3X9, Canada Toll-free 866-373-5772 Tel 250-656-8909 Fax 250-656-8969 Email Us |
