The Soundings Trade Only Today magazine recently published an article entitled “Online used-boat sales sans broker” which outlines an effort that enables buyers and sellers to execute a transaction without the services of a broker.
I applaud any effort whose aim is to responsibly get more people out on the water aboard the vessel of their choice, but the internet by itself will not always be the solution.
Ultimately, brokered transactions are about relationships. Sometimes I help a buyer and seller come together quickly and effect a sale. In other cases I’ve spent years with clients, both buyers and sellers, helping them chart their path. In some cases they were planning to buy a boat to cruise upon retirement, or were looking to transition from sail to power. In other cases they were looking to move up or down in size. Over the course of days, weeks and months spent talking, emailing, texting and dock walking, these clients have become more than buyer x or seller y. They have become friends, and I’ve become a trusted agent upon whom they know they can rely. Along the way they have become extremely well prepared for their next step because they know the market in a way an internet search could never replace.
I’d argue that savvy brokerages have not “missed the train” when it comes to the internet. We leverage its power to help buyers and sellers get what they want via exposure and education. We use cloud based data storage to quickly produce information for buyers and sellers whether it be showing a listing on a tablet or walking them through the details of a purchase and sale agreement. We use internet based forums to rapidly exchange information between company brokers and thus more efficiently arrive at a solution for a buyer or seller.
The intricacies of a deal, and thus the value of a broker, aren’t about writing up a contract or advertising a boat for sale. It’s about what happens between the first showing to the last wired funds that closes a transaction. The broker, as that knowledgable third party, can assist both buyer and seller to a degree that can’t be replaced by the internet alone.
Thanks. A well written piece. It just touches on a topic on which all brokers are confronted more and more these days. In depth discussion on the many facets of brokerage could help us all. Here are a couple. Brokers are the facilitators of negotiations between buyers and Sellers. Many Sellers are not familiar with, nor understanding of this part of bringing a sale together. Too often emotions get in the way of finalizing a deal. The broker has the ability to transend this. Another is who would hold the deposit
Thank you John,
There are so many points to be made in this discussion but I wanted to keep the post brief. Good thoughts.
Some sellers see brokers as too expensive. Some buyers sense a ‘deal’ by purchasing directly from seller. Sometimes they are correct. The real estate industry has ‘for sale by owner’ sites and the statistics show that sellers receive approximately 80% of market price. But hey they saved the commission!
Of my listings over the years at Sailboats Northeast a number are from sellers who first tried to go it alone. Few people are qualified as photographers, script writers, have time available or selling skills to complete a successful transaction. Even fewer can engender trust.
I am resigned to always having a portion of the market be direct but believe that it will always be a small portion. And be relegated to the low end of the market. Successful people get that way by recognizing their own skills and sub contracting the rest. .
I like that people have choices of how to conduct transactions and can see corner cases where buyers and sellers can go direct, but I agree that it’s not ideal most of the time.
The brokerage function be it real estate, aircraft, or yachts is based on perceived expertise. If the expertise is delivered all have smiles, it is when there is no expertise, and or other motivations cloud that delivery of the expertise, that problems arise.
I am a long time ski/family boat owner and have desires to move up to a plus minus 50ft catamaran for retirement liveaboard and cruising. When actually at the point of being a buyer we will seek expertise in this range of catamarans. Our current boating knowledge has nothing to do with catamarans or a yacht/boat in the 50 ft range, let alone live aboard.
Jim thanks for the comment. We have some extremely knowledgable brokers who specialize in cats at UYS. I’d be happy to put you in touch with them.
Your article is spot on & very well written!
This reminds me of a story a seller named Bob told me while listing his boat.
Bob asked me why he was listing his boat with a broker rather than selling it direct.
I thought he was too busy & did not want to take the time – effort to sell himself.
Bob said he tried to sell his last boat on his own and went on to explain, he prepared the photos specifications & advertised the boat. Bob fielded a number of inquires with some pointless questions from uneducated, unqualified buyers. He made appointments to show his boat to buyers that were late & several no shows. Finally a qualified – knowledgeable buyer shows up and after Bob came to his “bottom line” the buyer wanted another 10% off because there was no broker involved.
Bob said the buyer did not even offer to split the 10% with him so he concluded it was a lot of effort with no reward for him & vowed never to sell a boat direct again.
Jeff Erdmann – Bollman Yachts
Jeff thanks for reading the post and for taking the time to leave a note – cheers
Brokers do so much more than just process a transaction. A good broker can help a buyer from making expensive mistakes. I am surprised how many people buy boats from a listing broker without having someone to represent them.
Sellers underestimate the amount of time time and effort is involved in selling a boat. I don’t know if this is merely an anecdotal observation or not, but many of the boats I’ve seen for sale by owners are not well maintained. I think it’s indicative of an owner who lacks the resources to properly care for the boat and is always looking for a cheaper way to do things. The owners who can afford to properly look after a yacht would prefer to have a professional handle the sale since their time is often too valuable to justify the distraction of entertaining “lookie-loos”. I think a lot of people with no intention to buy a boat will target boats for sale by owner because they know a broker will likely sniff them out before they waste too much time.
Having just joined the ranks of yacht brokers at Specialty Yacht Sales in Vancouver, Canada, I agree with many of the points made above. However, I think the most important is the problem the seller has when confronted with a so called “buyer” who trashes the love of his life looking for a “deal”. To me, if you are a buyer, the boat you are looking at had better hit you HARD in the heart before you start looking for deals. There is little or no money in buying a boat hoping to sell it for a profit. People buy boats because they love them and want to fulfill their dreams. If they just buy a boat because it was a “deal” then they will resent every penny they have to spend on them. So, without a broker, the seller feels insulted – constantly, and the buyer will probably resent, or regret the purchase because he was buying for all the wrong reasons.
The broker should be able to steer the buyer and seller through this maze of emotions and arrive at a satisfactory arrangement without tears or heart attacks. Yes, we need brokers.