The etiquette of buying a boat - surveys and offers...

We just closed on our boat sale in the USA and the buyer had a full survey, engine survey and a sea trial. We had to replace a small piece of plywood under an air conditioner as it had 'mould' on it from condensate from the compressor, even though this was all inside an enclosed compartment and hidden away. The sea trial I suppose proved the engine could run at full chat for 10 minutes, pulled full revs in gear etc, but the sailing trial proved very little other than that the in-mast furling and genoa furling worked, as I had to force the buyers to even try taking the wheel under sail. The broker, surveyor and myself at least enjoyed a last sail on a beautiful boat

A long time ago I hada buyer pull out on a trial sail on a Halcyon 23 as he said 'I didn't realise it did not have standing headroom!
 
Robin said:
We just closed on our boat sale in the USA and the buyer had a full survey, engine survey and a sea trial. We had to replace a small piece of plywood under an air conditioner as it had 'mould' on it from condensate from the compressor, even though this was all inside an enclosed compartment and hidden away. The sea trial I suppose proved the engine could run at full chat for 10 minutes, pulled full revs in gear etc, but the sailing trial proved very little other than that the in-mast furling and genoa furling worked, as I had to force the buyers to even try taking the wheel under sail. The broker, surveyor and myself at least enjoyed a last sail on a beautiful boat

A long time ago I hada buyer pull out on a trial sail on a Halcyon 23 as he said 'I didn't realise it did not have standing headroom!
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they didnt have head room when i fitted a few out 50 yrs ago @ OSY
 
vjmehra said:
The industry is in the dark ages...lets not kid ourselves, most people on here still feel a boat with a toilet is a 'luxury' :-)

However I completely accept boats are bought and sold every day, people put up with things, the same with houses, but even there things are changing, look at all the online estate agents popping up. Just because something is currently the norm, doesn't mean it will be forever.

Anyway what I call a test sail may actually be what you mean by sea trial. My point was about what should happen in an ideal world, I fully accept that at this moment in time the cost is probably prohibitive for the broker/seller hence the ideal situation is implausible in reality. But I stand by the fact that other than super cheap boats or those at a massive discount (where the buyer is fully pricing in risk) it is insane not to check out that everything works at sea.
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Pleased that you have now come to accept that what you are asking for is a "sea trial". Far from being in the dark ages, this has been in the standard contract for as long as I can remember and is normal practice. The buyer pays the cost as it is, as others have said part of the survey. Not everybody actually does a sea trial, because the survey and their own inspection has satisfied them, but it is common with complex boats where there is a lot to check, or where there are aspects of performance, for example ensuring that powerboat engines reach their designed revs.

Everything is covered in the contract to ensure that the buyer is happy with his purchase as there is no comeback once he has taken title. There is no reason why the contract cannot be varied if the seller and buyer agree to include specific conditions related to certain aspects of the boat, and specific situations which might lead to withdrawal.

However such things are not common as an informed buyer and an honest seller who follow the standard procedure usually conclude a satisfactory transaction.

If you are buying a new boat, the dealer may well offer a real test sail to convince you to buy his brand of boat rather than a competitor, but you might be surprised that few take up the offer. Having said that dealers often organise test days as part of their general sales pitch - for example to serious enquiries from a boat show, but it is more about keeping the prospect interested than actually learning much about how the boat performs. A potential buyer learns more from spending time with owners of the same boat than spending an hour on the boat with a salesman!
 
Resolution said:
OK, so what changes would you like to make to bring the industry bang up to date?
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1) Dealers/Brokers to GUARANTEE there are no liens on a boat purchased through them (or take the downside risk of suing the owner, rather than the purchaser)
2) Test Sails without a commitment to purchase
3) Surveys done by a neutral 3rd party, paid for by the seller upfront (included in the purchase price of course, but if already done the sale can be sped up)

Those are three points off the top of my head with respect specifically to purchasing. I'm not in the market for a boat so don't claim to be an expert, but two of those are issues that would be a big concern for me as a 'newbie' and the third one I think would benefit everyone frankly, but would of course have to be adopted as an industry standard (for what its worth I think the same should apply to English property sales in the same way I believe its done in Scotland).

However as I've already stated I appreciate they aren't on offer, presumably due to prohibitive costs. I don't expect to walk up to a dealer and get that service...I'm just saying thats what (I believe) should happen. If you think of the levels of customer service we expect now in other sectors, its far greater than 20 years ago, probably even than 10 years ago...the marine industry (in my opinion) seems to lag, with so much resistance.

More generally however I do think from the comments (I don't mean on this thread, people here seem pretty open to discuss) generally the industry is in the dark ages still, there is a strong resistance to change and anyone who disagrees with those who have 'experience' often gets shouted down. But feel free to disagree...its just based on my observations from browsing the forum.
 
Tranona said:
Pleased that you have now come to accept that what you are asking for is a "sea trial". Far from being in the dark ages, this has been in the standard contract for as long as I can remember and is normal practice. The buyer pays the cost as it is, as others have said part of the survey. Not everybody actually does a sea trial, because the survey and their own inspection has satisfied them, but it is common with complex boats where there is a lot to check, or where there are aspects of performance, for example ensuring that powerboat engines reach their designed revs.

Everything is covered in the contract to ensure that the buyer is happy with his purchase as there is no comeback once he has taken title. There is no reason why the contract cannot be varied if the seller and buyer agree to include specific conditions related to certain aspects of the boat, and specific situations which might lead to withdrawal.

However such things are not common as an informed buyer and an honest seller who follow the standard procedure usually conclude a satisfactory transaction.

If you are buying a new boat, the dealer may well offer a real test sail to convince you to buy his brand of boat rather than a competitor, but you might be surprised that few take up the offer. Having said that dealers often organise test days as part of their general sales pitch - for example to serious enquiries from a boat show, but it is more about keeping the prospect interested than actually learning much about how the boat performs. A potential buyer learns more from spending time with owners of the same boat than spending an hour on the boat with a salesman!
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Sea trial / test sail, I think we were talking about the same thing. I meant a sail to ensure nothing went wrong, a buyer should never be declined that (which I said was a test sail, but should have said sea trial).

What I also was saying however is that yes in the perfect world the buyer should be able to test the boat out just to see if they like the way it sails. I also said however I appreciate due to the costs involved this isn't practical. However, that doesn't mean its a bad idea, if all buyers expected it and it got built into the cost of purchasing (or selling), it would become the norm. The demand isn't (currently) there so it doesn't happen.

I think I essentially agree with your last post, I'm just talking about how I believe things should evolve, I have no doubt you know more than me about how the process actually works!
 
Kwik Decision said:
Well the weather forecast looks good for the weekend, why don't we phone the broker, pretend to be interested in the Halberg Rassie he's got for sale, and get a free days sailing in.........
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As I've said multiple times I appreciate its not cost effective for the broker to do that currently.

That doesn't mean it isn't the way the industry should evolve.

Liquidity is fairly poor (in most asset classes to be fair), if it is easier for the buyer the liquidity in theory should improve. Not that this alone would solve things of course, but it may help.

With cars it is now the norm, there's no reason why it can't be that way with boats if consumers expect it.
 
vjmehra said:
As I've said multiple times I appreciate its not cost effective for the broker to do that currently.

That doesn't mean it isn't the way the industry should evolve.

Liquidity is fairly poor (in most asset classes to be fair), if it is easier for the buyer the liquidity in theory should improve. Not that this alone would solve things of course, but it may help.

With cars it is now the norm, there's no reason why it can't be that way with boats if consumers expect it.
Click to expand...

And yes there's no doubt some would be time wasters, the same happens with all asset classes. Some people moan, some try to convert a potential time waster into a sale. It may not be cost effective today, doesn't mean it can't be in the future.
 
vjmehra said:
As I've said multiple times I appreciate its not cost effective for the broker to do that currently.

That doesn't mean it isn't the way the industry should evolve.

Liquidity is fairly poor (in most asset classes to be fair), if it is easier for the buyer the liquidity in theory should improve. Not that this alone would solve things of course, but it may help.

With cars it is now the norm, there's no reason why it can't be that way with boats if consumers expect it.
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There is a very good reason: the cost of launching and then recovering the yacht. Plus the time involved, always assuming the boatyard had space available in their travelhoist schedule.
 
Resolution said:
There is a very good reason: the cost of launching and then recovering the yacht. Plus the time involved, always assuming the boatyard had space available in their travelhoist schedule.
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Yep, I acknowledged at this moment in time it's not viable due to cost and as you point out time....however things change!

From a hypothetical point of view would it not be a good thing if it were possible?
 
vjmehra said:
1) Dealers/Brokers to GUARANTEE there are no liens on a boat purchased through them (or take the downside risk of suing the owner, rather than the purchaser)
2) Test Sails without a commitment to purchase
3) Surveys done by a neutral 3rd party, paid for by the seller upfront (included in the purchase price of course, but if already done the sale can be sped up)
Click to expand...

It is impossible to guarantee that there is no lien on a boat. However, like many things people worry about, it is very rarely a problem as due diligence will uncover most. Financial institutions do not lend against boats without a mechanism for ensuring the boat is not sold without their permission. The courts are very reluctant to support an undeclared charge against a boat, and the last case where there was a challenge (unsuccessfully) was nearly 30 years ago. So, in reality if you follow the normal procedures the chances of there being a hidden charge are just about zero. Anyway, how can a third party such as a broker guarantee something over which he has no control? He can demonstrate he has done due diligence, which is all a professional person can do. It is the same with other professional such as lawyers and accountants - they give you professional opinions, not guarantees.

Test sails without commitment has been done to death. While a trader such as a boat dealer may offer this as part of marketing his products (and most do) a second hand boat sale is a private contract between two people involving the seller's private property. Why should a seller allow any access to his private property other than a viewing without any commitment?

You misunderstand the purpose of a survey. There is no compulsion to have a survey - its purpose is for the buyer to satisfy himself that the boat is as described. Why should the seller pay for that? If a survey is done by a third party, nobody can rely on that - the duty of the surveyor is to his client and a third party surveyor does not have a client. There are practical issues, not least the fact that boats often take months to sell and a survey done at the start of a sale process will be out of date by the time the sale happens.

Buying a used boat is no different from buying a used house. It is offered as seen with no guarantees and it is up to the buyer to satisfy himself it is suitable for his needs.
 
Tranona said:
It is impossible to guarantee that there is no lien on a boat. However, like many things people worry about, it is very rarely a problem as due diligence will uncover most. Financial institutions do not lend against boats without a mechanism for ensuring the boat is not sold without their permission. The courts are very reluctant to support an undeclared charge against a boat, and the last case where there was a challenge (unsuccessfully) was nearly 30 years ago. So, in reality if you follow the normal procedures the chances of there being a hidden charge are just about zero. Anyway, how can a third party such as a broker guarantee something over which he has no control? He can demonstrate he has done due diligence, which is all a professional person can do. It is the same with other professional such as lawyers and accountants - they give you professional opinions, not guarantees.

Test sails without commitment has been done to death. While a trader such as a boat dealer may offer this as part of marketing his products (and most do) a second hand boat sale is a private contract between two people involving the seller's private property. Why should a seller allow any access to his private property other than a viewing without any commitment?

You misunderstand the purpose of a survey. There is no compulsion to have a survey - its purpose is for the buyer to satisfy himself that the boat is as described. Why should the seller pay for that? If a survey is done by a third party, nobody can rely on that - the duty of the surveyor is to his client and a third party surveyor does not have a client. There are practical issues, not least the fact that boats often take months to sell and a survey done at the start of a sale process will be out of date by the time the sale happens.

Buying a used boat is no different from buying a used house. It is offered as seen with no guarantees and it is up to the buyer to satisfy himself it is suitable for his needs.
Click to expand...

You've sort of proved my point about resistance to change there...
 
vjmehra said:
You've sort of proved my point about resistance to change there...
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vj
Whilst I applaud your interest in improving the existing system, haven't you considered that lots of yacht brokers have already spent hours looking for ways in which to improve their service? And done so with the practical experience which you are , I suspect, lacking?
Peter
 
Whenever this topic comes up, there are always people who challenge the standard way of doing things, usually on the point of the timing of the sea trial. I see nothing wrong, if the boat owner is willing and the boat is in the water, in following the car sales idea of taking the boat out for a trial before making an offer. However, undertaking a sea trial cannot be compared to a similar trip in a used car.

For starters, typically you take a car out for perhaps thirty minutes. It can be done almost on demand, the only holdup being perhaps a need to shuffle cars on a forecourt to get it out (I tend to buy the cheapo car at the back of the forecourt...) A sea trial will often be dependent on the state of the tide as well as the availability of someone to accompany the potential buyer. It will typically last two or three hours and will need and hour or two before and after to ready the boat for sea and shut it down afterwards: effectively a days work for someone.

When you start to consider all these points, it becomes obvious why most sellers and virtually all brokers will not be happy to arrange a sea trial without some sort of commitment to buy before arranging one. I'm lucky, I'm retired and have the time to arrange a pre offer trial when I come to sell a boat but it's simply not possible for most people. And even then I would seek to have any out of pocket expenses covered should the trial not result in a sale. Now how would I arrange that? Well, I think I'd need a deposit wouldn't I?

Do people begin to see where the problems lie?
 
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