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

[daviddb]

I 've never yet bought a boat. Father drummed the 3-Fs rule into me from an early age.

In my life I've bought four houses, three with a survey. Each of the surveyed houses later, after the passage of time, proved to have significant, material yet fixable problems. At a cost. In one of the cases we went some way down the legal road of taking the surveyor to task but reached a point of saying 'you know what let's just fix this, wipe our mouths and move on with life ' Sueing someone with professional indemnity insurance is, by and large, a mugs game. Indeed from subsequent conversations with those in the trade one gathers that these days most every paragraph in the survey is boilerplate cut and paste from the indemnity insurers pre-approved selection.

So how might this translate to the boat buying process? As a tyro I think I would like to be there during the survey having a conversation and am unlikely to complete the deal without plonking the barkey back in the water to have the major systems demonstrated as best as practical.

Wishful thinking? I hope not..... that pension lump sum is starting to burn a hole in me trews.

 

[Garold]

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?

I think that the brokers are concerned about time wasters.

If buyers were willing to make a fair contribution to the real or notional costs of a test sail then surely someone could organise it. Even if it was a third party who offers this service either through the broker or independently from the owner.

And for those owners who don't want to take up this service/option, they can opt out.

In a slow market, I'm surprised that the selling boats hasn't changed much. All the old obstacles remain.

Garold

 

[Resolution]

.

In a slow market, I'm surprised that the selling boats hasn't changed much. All the old obstacles remain.

Garold

There has often been a slow end of the market. That is, the MABs that are poorly presented, probably over-priced by a long-standing owner, and for which the standard costs of a survey or a launch off and lift back out again are substantial compared to the capital value of the boat. These slow movers sometimes obscure a faster-moving market in newer AWBs at higher values.
Peter

 

[vjmehra]

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

The problem is, as with estate agents, in order for things to evolve many existing brokers would probably cease to exist, so whilst it may be in the interest of the market as a whole it would not necessarily be in the interest of all brokers for things to change, hence there is likely to be a strong resistance to change within the brokerage community (again that's opinion not fact).

Its also worth noting that its impossible to capture the number of potentially missed sales from people put off by the existing process (it may be negligible of course....but then again it may not be).

 

[duncan99210]

The problem is, as with estate agents, in order for things to evolve many existing brokers would probably cease to exist, so whilst it may be in the interest of the market as a whole it would not necessarily be in the interest of all brokers for things to change, hence there is likely to be a strong resistance to change within the brokerage community (again that's opinion not fact).

Its also worth noting that its impossible to capture the number of potentially missed sales from people put off by the existing process (it may be negligible of course....but then again it may not be).

The cost implications of your change to the normal pattern are considerable. Unless the boat owner has time to conduct pre offer trials, then you need a crew of two for most of a day, say £250. Lift in and out costs will be another say £350, mitigated if the boat is in the water. So that's an outlay of somewhere in the region of £600 for a boat on the hard, less for one in the water.

If the broker were to conduct the sail himself, then he'd loose a day's work in the office, so the opportunity costs for that need to be factored in as well.

If there is an accepted offer in on the boat, with a deposit paid which could be used to cover costs, then there's no worry. But running a risk of being out of pocket a not inconsiderable sum for a "tyre kicker" would require some sort of mechanism for ensuring the cost could be recovered if the trial did not result in a sale.

The usual progression of viewing (accompanied or not) followed by offer, deposit and contract, survey, sea trial and completion represents a clearly understood progression which is cost and labour effective. The only exception to that sort of process is where the boat is in the water and the owner has the time and inclination to permit sea trials to any interested potential buyer.

 

[vjmehra]

The cost implications of your change to the normal pattern are considerable. Unless the boat owner has time to conduct pre offer trials, then you need a crew of two for most of a day, say £250. Lift in and out costs will be another say £350, mitigated if the boat is in the water. So that's an outlay of somewhere in the region of £600 for a boat on the hard, less for one in the water.

If the broker were to conduct the sail himself, then he'd loose a day's work in the office, so the opportunity costs for that need to be factored in as well.

If there is an accepted offer in on the boat, with a deposit paid which could be used to cover costs, then there's no worry. But running a risk of being out of pocket a not inconsiderable sum for a "tyre kicker" would require some sort of mechanism for ensuring the cost could be recovered if the trial did not result in a sale.

The usual progression of viewing (accompanied or not) followed by offer, deposit and contract, survey, sea trial and completion represents a clearly understood progression which is cost and labour effective. The only exception to that sort of process is where the boat is in the water and the owner has the time and inclination to permit sea trials to any interested potential buyer.

Absolutely, hence its not currently viable, I've not said it is. I'm merely saying it's in the inter st of the industry as a whole to work towards that. It may of course never happen....but maybe one day it will who knows!

 

[duncan99210]

Absolutely, hence its not currently viable, I've not said it is. I'm merely saying it's in the inter st of the industry as a whole to work towards that. It may of course never happen....but maybe one day it will who knows!

But if the system works, why reinvent the wheel?

 

[vjmehra]

But if the system works, why reinvent the wheel?

It doesn't really work, thats the point, it functions.

Things could be significantly better for the buyer, not necessarily for individual brokers. But if you had a more secure, efficient process then there is less risk for a buyer hence the market should encourage new purchasers and improve liquidity.

That in turn should be good for the industry, although inevitably some smaller brokers may not be able to generate enough margin to remain viable.

As I say though, its not something that will happen in a hurry, as with the housing market a lot could be done to improve things but there is resistance from the industry, it all comes down to whether enough people feel things could/should be better or not.

I'm just saying things could (and should) be improved, however that doesn't mean everyone will agree!

 

[Resolution]

Absolutely, hence its not currently viable, I've not said it is. I'm merely saying it's in the inter st of the industry as a whole to work towards that. It may of course never happen....but maybe one day it will who knows!

vj
I am getting tired of your banging on this point on which you are so manifestly WRONG. There are plenty of independent brokers (as in estate agents) who would adopt your suggestion IF it made sense. It doesn't, so they don't. Give up.

 

[vjmehra]

vj
I am getting tired of your banging on this point on which you are so manifestly WRONG. There are plenty of independent brokers (as in estate agents) who would adopt your suggestion IF it made sense. It doesn't, so they don't. Give up.

what you've said makes absolutely no sense...

I've clearly stated that it wouldn't be cost efficient to implement what I'm talking about at the moment, that applies to large and small brokers.

As I've said multiple times, that doesn't mean it couldn't happen in the future and it would undoubtedly be better for the buyer if it did.

Anyway why don't we put this to bed for now and see the state of the market in 10 years time

 

[steve yates]

vj
I am getting tired of your banging on this point on which you are so manifestly WRONG. There are plenty of independent brokers (as in estate agents) who would adopt your suggestion IF it made sense. It doesn't, so they don't. Give up.

Why is he wrong? Just because you disagree? Or brokers disagree? He is speaking from a buyers PoV, which in the end is the customer. I think he speaks sense, and I realise, as he also admits, there are substantial costs and obstacles to it working in that fashion.
Just because there are, does not mean the system is perfect as is, nor does it mean it will always stay that way.

Just a simple what if.... Imagine brokers reccomended that boats for sale be moored? Or that they took a bond from a serious buyer, which paid for the lift out lift in.? Or they bought their own crane? Or whatever. Businesses must always adapt and markets rarely stay the same.
The boat buying business seems to me to be often ( not always) pretty shoddy, with crap pictures, dirty boats, and a lack of interest.
If the broker doesn't make enough on these things to bother doing it properly, just don't accept them for sale?

 

[Lucky Duck]

I think he's admitted to having no interest in buying a boat is its a moot point really

 

[Blue Sunray]

vj
I am getting tired of your banging on this point on which you are so manifestly WRONG. There are plenty of independent brokers (as in estate agents) who would adopt your suggestion IF it made sense. It doesn't, so they don't. Give up.

Some already do to some extent. My last purchase was subject to sea trial 'to buyer's absolute satisfaction'. Frankly you're beginning to sound a little worried that your comfy existence might be undermined.

 

[vjmehra]

I think he's admitted to having no interest in buying a boat is its a moot point really

That's correct I am not looking for a boat currently, however that is irrelevant to whether I believe the process could be improved for the buyer or not.

 

[Blue Sunray]

That's correct I am not looking for a boat currently, however that is irrelevant to whether I believe the process could be improved for the buyer or not.

Don't you try that logic thing, that's cheating round here, not exactly sportsmanlike.

 

[Lucky Duck]

Some already do to some extent. My last purchase was subject to sea trial 'to buyer's absolute satisfaction'. Frankly you're beginning to sound a little worried that your comfy existence might be undermined.

My last boat was 'subject to sea trial', it was several weeks before the boat yard were able to launch as it was in the middle of 'launching season'. It was finally launched just before Easter and on the Saturday we motored up and down the river for 10 mins or so in the pissing rain before everybody had had enough.

Overall it seem just a waste of everybody's time and money

 

[vjmehra]

My last boat was 'subject to sea trial', it was several weeks before the boat yard were able to launch as it was in the middle of 'launching season'. It was finally launched just before Easter and on the Saturday we motored up and down the river for 10 mins or so in the pissing rain before everybody had had enough.

Overall it seem just a waste of everybody's time and money

But that was (presumably) your choice, you could have asked for longer to ensure there was a chance to get the sails up in case there were any unforeseen problems.

Also surely by getting out even for only 10/20 minutes you were presumably able to feel confident enough that the engine and instruments worked okay (for example). So that in itself made it worthwhile?

 

[Resolution]

Why is he wrong? Just because you disagree? Or brokers disagree? He is speaking from a buyers PoV, which in the end is the customer. I think he speaks sense, and I realise, as he also admits, there are substantial costs and obstacles to it working in that fashion.
Just because there are, does not mean the system is perfect as is, nor does it mean it will always stay that way.

Just a simple what if.... Imagine brokers recommended that boats for sale be moored? Or that they took a bond from a serious buyer, which paid for the lift out lift in.? Or they bought their own crane? Or whatever. Businesses must always adapt and markets rarely stay the same.
The boat buying business seems to me to be often ( not always) pretty shoddy, with crap pictures, dirty boats, and a lack of interest.
If the broker doesn't make enough on these things to bother doing it properly, just don't accept them for sale?

Steve
vj is wrong because he is proposing a structure which involves costs which make it unattractive. He admits these costs exist ("at present") but still suggests we should consider his way. The point I have tried to put over is that many brokers HAVE looked at ways of improving the buy/sell process, but have discarded the alternatives which are obviously impractical or uneconomic. It is hard reality that he is wrong, nothing to do with my personal view or any brokers' views.

"I think he speaks sense, and I realise, as he also admits, there are substantial costs and obstacles to it working in that fashion." I think you need to take a reality check. There are so many things that would be wonderful if only there were not substantial costs and obstacles in the way.

" Imagine brokers recommended that boats for sale be moored? Great, except that they will have to be lifted for the survey. Difficult to escape that dilemma.

Or that they took a bond from a serious buyer, which paid for the lift out lift in.? It is not really a bond that you need, because the seller will need the expenses of the launch off, trial sail and then lift back out to be definitely paid. These are third party expenses which someone will have to pay. Of course the seller might be prepared to wrap them into a competed deal sale price, but until the deal is definite they remain just expenses.

Or they bought their own crane? Time for another reality check.

Sorry to be so dismissive, but there are lots of brokers with lots of experience out there looking for a way to gain an advantage over their competitors. As has been said before, the present system is not perfect, but it is the best balance of buyers and sellers interests that the market has been able to come up with. No doubt there will be changes over time, and new technology does make some differences.

 

[Lucky Duck]

But that was (presumably) your choice, you could have asked for longer to ensure there was a chance to get the sails up in case there were any unforeseen problems.

Also surely by getting out even for only 10/20 minutes you were presumably able to feel confident enough that the engine and instruments worked okay (for example). So that in itself made it worthwhile?

Sorry, missed off the word 'sold'

 

[Resolution]

Some already do to some extent. My last purchase was subject to sea trial 'to buyer's absolute satisfaction'. Frankly you're beginning to sound a little worried that your comfy existence might be undermined.

??? "My comfy existence"??? I don't think we have ever met, so not sure how you are able to judge whether I am comfy or not. But I have bought and sold a number of yachts over several decades of boat ownership in various different countries, so have a fair amount of practical experience in boat transactions. I have also in the past been an owner or part owner of businesses involved in marine matters, so have seen it from the other side as well. What I have been trying to bring to this thread is a bit of reality in the face of some lovely but impractical suggestions.
Peter