Buying a used sportfisher is a complex transaction that involves hundreds of thousands or millions of dollars and lots of moving parts. For the average would-be boat owner, without experience in boat sale transactions, there can be many pitfalls.
A misstep at any point along the way can cost lots of money, waste quite a bit of time, kill the deal or a combination of all three. What follows is some perspective on what to expect… as well as a bit about the value of working with professionals who know and understand the process.
An InTheBite How To by Winslow Taylor
Like many others before you, you may have been bitten by the sportfishing bug. Maybe you have moved up from a center console or wanted to jump right into the sportfishing scene, either way, purchasing a boat can be a daunting task. The new boat market is fairly easy to ascertain, meaning comps are easy to find and a vessel’s value is not difficult to predict.
The used boat market, on the other hand, is vast and can seem overwhelming. Although a prospective purchaser can cruise yachtworld.com (or the InTheBite classifieds!) it’s not like buying a house and looking at Zillow purchase and sale prices. When approaching a used boat you need to come to the table armed with an open mind and plenty of information (or with someone who has plenty of information).
Speaking with brokers, surveyors, and captains this article provides some insight and perspective geared to getting you into the boat for you at a fair price, without the headache.
First Things First – Determining What You Need
It may sound like common sense, but only you (the purchaser) really knows how or where you are going to be using your prospective boat. Assuming you have never owned a large(r) sportfish you should be open to using your boat for new things, but be careful not to be a “dreamer” and purchase something you don’t need or that doesn’t fit your use.
If you spend 90% of your time a few miles off Palm Beach, for instance, your needs would be different than someone running to the canyons daily. If you don’t have an immediate need or desire to travel with your boat, there is no need to be sucked into purchasing extra systems designed for travel which may otherwise incur increased maintenance cost and that you will not use.
Determining the systems and capabilities that you need in a boat – as well as those that you may not, is a great first step in the purchase process. If you lack experience coming in, an experienced captain, a professional broker or a boat owner who has been at it a long time are all excellent sources of perspective in this regard.
Knowing what you want going in is also a great way to expedite the process. If you want to buy a pickup truck, you don’t need to look at sports cars.
Avenues of Boat Purchase
Primarily there are two ways to purchase a used boat: (1) using a broker, or (2) owner to owner. Using a boat broker is probably the most common approach, and it certainly is the best approach if you lack experience and knowledge – or if you just don’t have to time to babysit a deal. Brokers are excellent resources and a good broker’s job doesn’t stop when the sale is complete.
Depending on the experience level of a prospective buyer, a broker can wear many hats. Jud Black a broker with Bluewater Yacht Sales provides insight into this fact. Black explains his job as finding a needle in a haystack, then negotiating the deal, going through due diligence, and keeping everything pointed towards the finish line. This is no easy task, especially when money, emotions, and specialized equipment are on the line.
For an inexperienced buyer Jud may spend hours talking with the client about how they hope to use the boat and what the budget may be. This would be followed up by looking at several (maybe dozens) of boats to get a feel for what customer likes. It might seem obvious, but there are many questions that only the buyer knows.
Something as simple as where the buyer wants to keep a boat can have a great deal of influence on the purchase. If you want to keep your boat behind your house, but you only have 4’ at low tide, a boat drawing 6’ would be a no go. Not considering this before buying the boat would cause a fair bit of headache later.
Jud also points out the less obvious concerns that need to be addressed. Does the prospective boat have motors that are prone to potential issues or gelcoat/paint issues? A boat may check all the boxes and look great, but if it has an eight-year-old paint job with a paint that has a ten-year life expectancy, that could be a huge unexpected hit to the wallet and resale value.
Selecting the Right Broker for You
Although it may sound obvious, it’s important to retain a broker you can truly trust and that understands exactly what you are looking for. You don’t hire a sailboat broker to find you the best-maintained used Spencer on the market. You need someone that knows the product inside and out. Another extremely knowledgeable broker, Rob Spano of the Palm Beach HMY office, illustrates this point clearly.
One of the most important commonly overlooked variable is boat history. Anyone off the street can search yachtworld.com, but an excellent broker will know the vessel history of each boat as well as their maintenance schedule and fishing program. Rob’s (and HMY’s) network allows him to get the full picture for clients.
For example, two 2000 55’ Vikings may seem nearly identical on paper and in person, but a good broker will be able go beneath the surface to determine how each boat was cared for. Was the boat captain or owner maintained? Do did they adhere to the recommended maintenance schedule? Will the seller provide you the maintenance logs? Did the owners’ kid run the boat ragged? Was it lightly used or fished the canyons no-matter-what?
The truthful answer to those questions can go a long way to determine pricing and whether or not you want to purchase the boat at all. A beautiful boat at the dock isn’t worth much if it’s been severely neglected below the waterline and in the engine room. Rob also discussed the importance of a truthful long-term plan. Rob needs to be able to know how you are going to use your boat, so he can provide vessels which fit that criteria.
If you (the buyer) walks into a brokerage house and say “I want a big boat, with a stateroom, diesel engines, and a fighting chair” then you are just blindly throwing darts against a wall. The buyer needs to do his homework so he can allow the broker to work efficiently. It’s a two-way street, and the more information the broker has, the better he will be able to identify certain boats which check all your boxes.
Although brokered deals are more commonplace in larger vessels, plenty of boats are sold “off market.” With these transactions come the potential for increased headaches and misunderstandings. One example of an off-market deal was when Captain Rob Barker (http://fishdesperado.com/) of Manteo purchased the Desperado a 56-foot Taylor Made. Since Rob was already running his owner’s Hatteras, he helped facilitate the purchase of the Taylor Made.
In situations like this, Rob already knew the “new” boat’s history, but he still had to schedule surveys, negotiate a price, and handle the financial side of the transaction. It certainly is not out of the ordinary to have an owner to owner (or captain to captain) sale, but there are a lot of moving parts and you need to really know what you are doing.
No matter how you are purchasing your boat you should have everything in writing. It’s a huge purchase and you do not want to leave anything to chance!
Get the Survey!
I’ll say it. If you are buying an even remotely complicated larger boat and you don’t get a survey, you are making a mistake. Regardless of how you find your new to you boat, you NEED to get a hull and probably an engine survey. Now if you regularly buy and sell smaller center consoles (and you know your product) then you might not need to spend the money, but anything else should necessitate a survey.
Most saltwater boats that are five years or older and greater than 26’ require a survey due to insurance guidelines. Furthermore, if there is a loan involved, the bank will most likely require a survey. To provide some guidance in the process I talked with Jared Houghtalen of JHH Marine Services LLC (https://jhhmarineservices.com).
Jared is a marine surveyor out of Wilmington who regularly surveys new and used boats around the Carolinas. Jared’s job is to dive into the condition of the vessel and provide a report to his client on the boat’s systems and their condition. In talking with Jared, he broke the process down into two buying scenarios (1) a brokered sale and (2) a private sale.
For a surveyor, the most straightforward is the brokered sale. In a brokered deal everyone’s roles and responsibilities are well defined. All communication between the parties happens through the broker or brokers. When it comes time obtain a survey, usually the broker representing the buyer provides a list of surveyors to the buyer. It’s up to the buyer to contact and hire the surveyor of his choice.
One of Jared’s recommendations for a potential buyer is to make some phone calls to the surveyors and/or do some research online. There are numerous resources and reviews online which help to find the right surveyor. Also check on surveyor’s report and turn around time, as time is often of the essence.
Once a buyer’s offer has been accepted, the clock begins for closing (always read the contract and understand the trigger dates). At this point, if you already have a relationship with a surveyor – great! If not, you need to move quickly as surveys don’t happen overnight. The next step is finding dates which work for everyone, this includes, broker, owner, and haul out facility.
There are a lot of moving parts involved which is why having a broker representing you makes the process easier. Usually with a brokered boat, the surveyor and buyer find a date that works for both parties (if the buyer is attending). The date is provided to the broker, who then lines up a haul out facility, a haul out time and coordinates who is going to run the vessel for survey.
Unless you plan on rowing your new boat, engines surveys can be just as important as surveying the hull. Although it can depend on whether the engines are under warranty, it is always a good idea to have a mechanic or technician inspect the motors. Today’s engines are highly sophisticated pieces of equipment and it’s important to hire someone who is familiar with the engines on your prospective boat.
For instance, if I had CATS, I would try to find an engine surveyor (or technician) who specializes in CATS. Between a hull and engine survey you should be able to put together a pretty good picture.
Surveys in Private Transactions
Although no two transactions are identical, Jared is quick to point out that private sales are a little more complicated than brokered deals. Jared’s main emphasis on a private sale is the potential for misunderstanding between the parties. If you are a buyer, communicate with the selling party that you wish to have a surveyor perform a pre-purchase survey.
Additionally, in private sales the buyer or seller (and sometimes surveyor) will have to play a bigger role in scheduling a survey date, a sea trial time, who is going to run the vessel and where the vessel is going to be hauled to inspect the wetted surfaces (if required).
Although it should go without saying, but it’s especially true in a private sale, make sure to clearly communicate your intentions to have a survey. Not everyone knows what a surveyor does, when he is available and how long a survey takes to complete.
Buying a used boat is a process, and you really need to figure out what works best for you. Boating is supposed to be fun, but if you buy the wrong boat or stretch yourself too thin financially, it goes from fun to stressful very quickly. It’s important to know your limitations and
reach out to those who know more than you. All the folks I spoke with in the article reiterated that buying a used boat is a team sport. If you are in the market or think you may be in the market, I urge you start doing your research because the more you know the better off you will be.
Do you have any comments or questions for us? We’d love to hear from you.