SELLER’S GUIDE
This guide is directed at Sellers who are trying to sell their yacht on Boat Trader as a Seller Direct effort and includes helpful tips to making the sale happen.
You might consider that your showings are crucial. First impressions are everything!
Following are things that I have strived to do after years of successful yacht selling:
1. Develop a nice brochure in digital format and printable (so you can keep a copy onboard during showings). When you compose your brochure, use a format with only important information and strive to be brief with highlights for added equipment/improvements.
Take nice photography which shows the different areas of the boat in wide-angle and good lighting. Have it ready to send to inquiries.
Ensure that a wide angle profile of the boat is the one posted on the BT ad. I prefer profiles away from the dock.
Do your research and ensure that your boat is priced within the market if you want calls!
2. Prepare your yacht for showing! Remove all unnecessary clutter.
Make beds and consider buying new comforters, sofa pillows and such. The ladies (often the key element to going forward) are especially sensitive to ambiance as they see themselves enjoying the boat.
Ensure the boat is clean – inside and out. Don’t forget about clean bilges and holding tank odors.
Put yourself in the Buyer’s shoes and ask yourself if this boat (yacht) is something you would want to buy.
3. Showing Time. – Ensure that the boat is easily accessible to get onboard. Just because it works for you, might not mean that it works for older peeps or women. It can also cause trouble for you if someone might hurt themselves (God forbid!)
Take care of maintenance items including making the engine room tidy and corrosion free. This isn’t hard using products like Spray 9, Ospho (for rust) and something like Corrosion Block. Savvy buyers look at the machinery as a reflection on how the boat is being kept. Polish the boat. Clean the cushions. Remove anything from the boat that you do not wish to convey (like tenders or jet skis, tools, artwork, etc). Buyers don’t like it when you take things away from the showing.
Keep in mind that a properly kept yacht will defend a certain price a whole lot better than a boat (or yacht) which has a lot of excuses.
If you have a cabin style yacht, be sure to cool the boat prior to viewing and turn on all the lights including the engine room!
Be sure to disclose any serious deficiencies or repairs made in advance (ie. Termites, groundings, engine failures, etc). Don’t wait until later – this is fertile ground that attorneys love to explore for lawsuits.
4. I do not recommend owner involvement if you can help it. Train a capable person to show the boat if you can. Be distant, it will help you in the long run. Or just introduce yourself, go away and let your trained person handle it. The reason for this is that many sellers make the mistake of agreeing to things as they get ‘put on the spot’. This is especially true of survey time. I have seen many deals fall apart or costly agreements made that didn’t need to happen – just because of such.
5. Offer Time. Have you considered a purchase agreement with a deposit in escrow?
If not, you should consider this, rather than a ‘handshake’. Any competent attorney can draft one for you (if you don’t mind the cost).
Key elements should include:
• Date of offer
• Date of offer/acceptance
• Date of acceptance (after the buyer surveys the boat)
• Date of closing
• Deposit (normally 10% held by an independent entity in escrow)(the escrow agent is party to the agreement)
• Responsibilities of seller (ie. You will provide the seatrial and delivery back and forth to the haulout site at your cost, any taxes or vendor payments due before the closing, etc)
• Responsibilities of Buyer (ie. They will pay for haul out costs and survey, taxes due from the sale, cost of registering, etc)
• What happens to the deposit if the Buyer or Seller default?
• Guarantee of clean title
• What happens if the boat is damaged prior to closing
• Language saying that the seller will not sell the boat to another party during the period of agreement
• Language saying that the seller will not use the boat after survey
Remember that often, paperwork is needed during the course of the deal (normally 30 days). Ensure that you keep up with such and file accordingly. But do this to stay within the terms of the agreement (ie. Extensions, etc)
6. Survey Time. A wise seller will do a pre-survey check on all the systems to ensure that things are working properly. Do this ahead of time to ensure you can fix what may be broken. Little things add up (bilge pumps, light bulbs, etc )…try to repair or improve whatever you can so that they do not become a sore issue. Too many little problems equals a poorly kept boat in some eyes. Have the bottom cleaned prior to survey. Engines should be left ‘cold’ prior to surveyors coming aboard.
You should remember that it is always cheaper to fix things ahead of time rather than negotiate a price adjustment or lose a deal due to something easy to remedy.
Many owners neglect to have their fire suppression system certified yearly. This is one of the ‘easy’ fixes. Another item is the engine cooling systems…did you know that many engines who don’t have seriously neglected coolers (along with the air conditioning system) can have them cleaned via a closed loop with mild acid?
A pre-seatrial at wide open throttle (check temperature) is advisable.
Any significant receipts for work or repairs should be available.
Surveyors (hull and engine) typically show up early morning and start working during ‘cold’ conditions. Someone should be available to show them how to get to certain things or explain systems. Don’t leave it to guess work.
A trusted operator should be in place to get the boat to the haul out site, do a seatrial and back home. Use one who can familiarize himself (herself) with the boat ahead of time. Don’t do it yourself!
Recall above where I mentioned that the owner should be remote from the survey? This is quite important during survey. Everything that shows up on survey will have the buyer looking at YOU to correct a particular issue.
7. Acceptance Time – This is where the ‘rubber meets the road’ so to speak. And this is where being remote during survey time does you a favor. A bit of time between the survey and acceptance provides time to figure out problems and digest the issues. The sooner you address stuff the better.
Almost always, buyers feel compelled to ask for adjustments to price or repairs made. You are almost always better off taking care of deficiencies on your own (unless they are big ones). This is where the pre-seatrial and survey comes in handy.
Understandably, things happen out of your control. However, this is the time for patience and logically figuring out how to make things happen…otherwise your time is wasted. And worse, word gets out that a boat ‘didn’t pass survey’.
8. Closing time – So, if you have a good agreement, this is where the deposit ‘goes hard’ ie. Non-refundable. And whereby a buyer default can gain you the deposit for your time.
A seller usually doesn’t need to do much during this period except look after the boat.
However, if the boat is held in a corporate entity, you should ensure that you are up to date and can provide both the Articles of Incorporation and a Letter of Good Standing (Incumbency). Is your documentation or registration up to date? Are you and any others on the title able to sign? Is your insurance and dockage up to date? Have you removed the exempted articles?
Prepare a closing statement for the buyer and ensure that correct documentation is signed over at closing time.
Handing over a boat should involve you personally or your trusted agent. It is always a nice gesture to explain different systems, show the buyer where things can be found, tell them about idiosyncrasies, etc.
And done!
Sounds easy right?
Well, these suggestions are developed after many trials and errors.
However, another aspect to consider is making the phone ring. Boat listings get stale…especially overpriced ones. They have a ‘shelf life’. Compound a high price with the cost of owning this asset along with depreciation – and you can do the numbers.
In today’s market, just one ad on one site doesn’t get it done. Circulating your ad in a variety of sites do.
There are a few components to a successful yacht sale – Location, Price and Condition. And Desirability. Give yourself time to follow this advice and you should achieve your selling goals.
Sounds like a lot? Actually it is.
Savvy, experienced sellers know that a good broker is instrumental to making deals happen. Yacht brokers come in a variety of colors. A good one is not a waste of money, rather a bonus to get the job done properly and at the best possible price. Many sellers end up listing their yachts after little luck with the one ad program.
I run into sellers who don’t want to use a yacht broker for a variety of reasons, such as:
• They had a poor experience with a lousy broker
• They are successful enough to buy the boat and may be in sales as a career
• They just don’t know what they are up against – it’s not like selling a car or anything else short of an aircraft
If you can relate to this article and want to contact me sometime, I am available. Free advice including referrals for trusted vendors. Want good stories to back up what I advise…I have plenty if you have time.
Standing by,
Andy Kniffin (Certified Professional Yacht Broker)
Ak Yachts – member IYBA and CPYB
Independent – 25 years experience
(954) 292-0629
andy@akyachts.com
