broker commissions

[Guest]

I am thinking of selling my Sealine through a 'big name' broker. I sence they will negotiate commission percents.....what is a typical percentage. Are there extras like having to pay for their adverts in MBY for example or is this part of the service.

regards David

 

[Guest]

David, the 'standard' percentage is 8% + VAT. Some brokers will negotiate that down to 6% or even 5% + VAT and that should include all costs such as advertising, leaflet preparation etc. You may wonder what a broker does for his 8% when an estate agent sells a house for 1-1.5% but thats another discussion. Just as important as the commission rate is whether the broker is going to actively market your boat and whether he attracts the sort of buyers interested in your boat. So, for a Sealine, it would be best to sell it through a Sealine distributor. For what it's worth, I have recently sold a Sealine thru' Racecourse Yacht Basin at Windsor for 6% + VAT but they prefer to have the boat on their own sales pontoon as they reckon it sells quicker that way.

 

[Guest]

Great advice, Mike, thanks Did Sealine get the price you wanted or did you have to reduce the price further (by what percentage if you don't mind me asking) David

 

[Guest]

RYB got me a deal which will work out about 5% less than my asking price before deducting their commission but that's a fairly meaningless number because it all depends on how realistic your asking price is in the first place. RYB suggested an asking price and I took their advice. Generally speaking, you may get close to your asking price if you are selling an in-demand model but you may have to accept, say, 10% less than your asking price if there are many of your particular model of boat on the market or the demand is low or the condition of your boat is poor. Another factor is the time of year. Right now is the buying season; it tails off in the summer, picks up again around the Southampton Show time (September) and dies in early winter once more. So, if you want to sell your boat, now's the time to do it

 

[Guest]

You made a point about brokers commissions earlier, compared to those of estate agents. When you sell a boat, you pay the broker to act on your behalf. He carries the FULL burden of that in terms of Personal Indemnity Insurance, checking for mortgages, assuring correct title, supervising the survey etc etc. A good broker is at the very least detective, policeman, solicitor, accountant and advisor. When you by a house, you may only pay the agent 1-2%, but what does he do for that? No where near as much as the yacht broker. To cover the difference, you have to also commission a solicitor and pick up the pieces in between yourself. The UK has some of the lowest commission rates in the world - in the US, you are lucky if you get anything less than 10%. Hope this helps and good luck with the sale!

 

[Guest]

Let's just do some sums... Estate Agent sells house say £100,000 commission at 1.5% say £1,500 Legal Fees (negotiated) say £800.00 Total £2,300

Yacht broker sells boat £100,000 say 6% total £6,000 no legal fees Total £6,000

UM! am I missing something?

 

[Guest]

Not quie in agreement with you arguments.

An estate agent will give a market appraisal as does a yacht broker.

An estate agent pays to advertise your poperty as does a yacht broker.

An estate agent shows round prospective purchasers as does a yacht broker.

Estate agents often accompany surveyors.

Admitedly an estate agent would not check for legal title or do other conveyancing. However, this would cost no more than £500 in solicitor's bills. On a £100,00 boat/house this would account for 0.5% of cost.

My point is that broadly speaking estate agents have similar overheads and do similar tasks to yacht bokers.

It's impossible to justify but the reality is that anyone can charge whatever the market will stand.

Thanks to the multitude of fender kickers/plaster kickers both jobs are pretty grim.

Anyone who thinks they can do it better/cheaper ought to.

 

[Guest]

OK, Adrian, I am buying a boat at the moment through a highly reputable and long established broker. I received from them a 2 page leaflet, the front page of which consists of a photograph photocopied from the manufacturers brochure with a few technical details; the second page consists of a photocopy of a standard tick box form which is supposed to indicate the equipment fitted to the boat but I know contains some errors. I have inspected the boat twice but the broker has never accompanied me; in fact the broker has told me he has NEVER seen the boat. I have arranged the sea trial, lift out and survey directly with the owner. The survey takes place tomorrow and this will be the first time I have met the broker (who is cadging a lift in the surveyors car) and the first time the broker has seen the boat. For this 'service', the broker will probably collect about £10000. Now the broker is a very nice man and has answered my questions promptly but do you think this represents value for money?

Your comment concerning title is another case in point. How exactly do brokers check title? Most boats are not Part 1 registered so there is no central register; I believe finance houses wont give specific information on boats without the owner's express permission. You seem to be in the business; so tell me how it's done? Frankly, I think brokers rely solely on the information given by the vendor on the brokerage form and leave it at that. I would'nt call that 'checking title'

 

[Guest]

I think part of the issue relates to volume. Most estate agents have hundreds of properties on their books and sell dozens a week. Most brokers have at best a couple of dozen boats and probably only sell one or two a week. Mind you, I still don't like having to pay them!

Doug

 

[Guest]

In other words, there's no real competition in the market. By and large, they all hold out for this ridiculous 6-8% commission and that allows them to survive on selling 1 boat a week. If commission rates dropped (as they would do in a truly competitive market with so many players), then only the efficient ones would survive

 

[Guest]

if the above stated isa really true then why are brokers like us on site seven days a week 360 day a year, offering accompanied viewingsin all cases and free berthing indefinately for craft for sale , i would truly like to have the chance of offereing you my craft list as i may already of done so! as the sevice we offer is the total opposite to what you are getting

 

[Guest]

an estate agent runs a small high steet office, a reputable broker runs a 5 to 10 acre marina and offers free stowage to craft for sale,is this not a difference?

 

[Guest]

Hey guy, and you get no other income from the yard from moorings, chandlery, fuel, workshops, lifts etc. Tell you what if you are agreeable, I will bring my boat home from your yard and you drop the commission to 1.5% (wink wink)

 

[Guest]

Dera Alistair - thanks for trying to put the records straight. If anyone would like further information on what we as brokers offer, they are more than welcome to call me at my office in Port Solent - 023 9220 1150 Tim Quinlan.

 

[Guest]

Dear Sir

You make some good points in the above message.

I have experience of both a running a brokerage office and an Estate Agents office. It's interesting to note that the profitability of both offices are about the same. In fact, the Estate Agent was slightly more.

Why is this? It costs about £80-100,000 pa to run a three person brokerage office depending on location - thats a lot of boats to be sold at an average price of say £1,800 income per boat. That's 55 boats per year or 4.62 boats per month - pretty hard work?

Please rest assured - you are never going to be a Millionaire selling boats!!!!!

 

[Guest]

If you are stupid enough to pay those bandits...

all that cash for sitting in their cosy offices wearing pink checked shirts and white pants then you have money to burn. Gimme some!

I have just sold my boat for not far off the asking with an ad in Yachting Monthly. I could have bought several pages for the nearly four grand that the marins in house broker wanted. Why can't he come to terms with earning a proper living like the rest of us?

Steve Cronin

 

[Guest]

PS. the Surveyor....

... who had a much more significant role in the transaction, bearing the liability for any losses due to inaccuracies in his report, cost only £270.

Lets see the 1% environment extended to yacht brokers by Her Majesty's distinguished Government and have a CAT standard for brokers! Not much chance though "If fat cats get stung that's their lookout" is much more likely to be their attitude!

Steve Cronin

 

[Guest]

Re: Your results from selling private?

I was very surprised to see the 8% charge plus vat that the broker I approached recently with the thought of selling our boat was going to charge.

Saying that the same guy took our 36 sedan on part ex for our new boat, and gave well over what we would have gotten on a private sale (the manufatcturer clearly has some considerable margins to play with) and we were able to expidite the disposal of our old boat rapidly and at a price that we were very pleased with.

We will probably be selling our boat at the end of next year, and I dont think that we will be trading for the same make, (I fancy a nelson or a botnia Targa) and will want to maximise our equity on our current boat, my big fear, how long will it take to sell the old boat? (answers involving lengths of string come to mind.)

I would be curious to see how quickly people are able to sell boats privately via private advertising, versus on the brokerage.

What did you sell and how long did it take?

Does anyone elso have any general advice and experience in regards to what sells best in what enviroment?

What actually counts as a "high demand" boat?

If the broker cant do a part ex against your boat because he doesnt own it, then I can not see the advantage of the broker for those who already own a boat and wish to buy yours! Or am I missing something?

 

[Guest]

Re: Your results from selling private?

My boat has been on the market since December last year with hardly a sniff. Yet I am assured the price is extremely reasonable and it is a popular make.

 

[Guest]

Re: Your results from selling private?

What make and model is it?