Buying a boat can be an exciting time but it can also be a stressful proposition full of complex choices, so it may be good to seek professional help in the form of a marine sales person. New boats are sold via a dealership that represents a given boat manufacturer and also direct from a smaller (volume) manufacturer. A pre-owned boat can be purchased from a broker, a private seller or more rarely from a dealer who took a boat in trade and is now reselling it.
If you’ve narrowed down your purchasing choices to a dealer for new models and a broker for pre-owned boats there are some benefits to each as well as tips on how to go about the purchase transaction.
Above: Working with boat dealers and yacht brokers can help simplify the boat buying process. Images via Pond5.
Benefits of Buying a New Boat from a Dealer
- Dealers are very knowledgeable about the specific brands they sell and service and can answer in-depth questions about them.
- Dealers service the brands they sell and they’ll take care of your repair, upgrade or replacement needs in the future.
- Dealers act as a liaison between you and the manufacturer for warranty work.
- Dealers can assist with arranging boat financing.
- Marine Industry Certified Dealers must meet high standards of customer service and have agreed to abide by the Marine Industry Consumer Bill of Rights so you’ll have recourse should something go seriously wrong.
- If a dealer doesn’t have exactly what you want on the show floor, they can order it allowing for extensive personalization as well as the addition of the latest technology.
Benefits of Buying a Used Boat through a Broker
- Brokers list their inventory on numerous websites so you may be able to find and research the model you want fairly quickly rather than scouring classified advertising.
- By listing nationally, brokers also attract buyers out of the immediate area so you have a wider range of options.
- Used boats have already gone through initial depreciation and the down payment may be lower so your dollar goes farther. A broker will be able to help value a pre-owned boat and have access to marine lenders for financing used boats that can (sometimes) be difficult to finance.
- Brokers can negotiate on your behalf if you’re uncomfortable with haggling or asking for changes.
- Brokers will be able to find similar boats on the market and may even suggest comparable models to consider if you can’t find the one you seek.
- Brokers can arrange a convenient and safe way for you to see (and possibly test) a boat rather than dealing with individual owners in random locations.
- Brokers can process the transaction paperwork so there’s less confusion and less possibility of fraud.
Tips on Purchasing from a Boat Dealer
Here’s how to get a better deal at a dealership.
- Buy in the off-season if you’re not in a hurry. September through February can be good months for better pricing, especially in cold northern areas where dealer inventories are just sitting.
- Buy last-year’s model from dealer stock for deeper discounts.
- If you’re ordering a personalized boat instead of buying from stock, ask if the dealer will pass on the discount from not having to inventory and finance it.
- Work with a dealership close to where you’ll be boating because it will be easier and faster to get the boat serviced.
- You may be able to shop and compare different dealers (even for the same boat brand) at a boat show as well as get a discount so see if there are any in your area.
- Don’t walk into a dealership unprepared. Educate yourself online as to what kind of boat you want, what size/brand of engine, which upgrades or equipment and what kind of price you’re prepared to pay. It will help the dealer zero in on your needs but also it will caution him/her against hard sell tactics.
- Narrow your choices to a few models before ever walking into a dealership to speed up the process but also to show the dealer that you know what you want.
- Ask the dealer for a test run. For new boats, you don’t have to put in an offer to go for a drive.
- Remember that boat dealers have slimmer margins than car dealers so your bargaining needs to be within reason.
- Check the dealer’s history and if you can, find reviews or testimonials regarding their pre- and post-purchase service.
- Work with a dealer with whom you can form a long-term relationship because boat ownership goes far beyond the day you sign the paperwork.
Tips on Purchasing through a Broker
- Brokers represent either a buyer or seller in the pre-owned boat market. Although they may focus their efforts on a certain type of boat, they’re not tied to just one brand and they can usually compare different boats within a category, opening up more choices to you.
- Brokers are like real estate agents. Find one, stay loyal and let them work for you.
- Ask about the broker’s resources including finance companies, insurance providers and service/repair vendors. Used boats have different challenges from new ones so you may need a strong support network.
- Make sure the broker is excellent with communications and organization because both will be needed when it comes to doing the sea trial (test drive) and survey of a pre-owned boat.
- Don’t let a broker talk you out of a survey.
- Ask the broker for a history of a chosen model. They should be able to access more information on anything sketchy.
- Remember that the broker’s commission will be subtracted from the seller’s net so be reasonable with you offers.
- Let the broker negotiate for you to keep everyone’s emotions in check.
- If you’re buying a used boat that was taken in trade, remember that the dealer (or a broker within the dealership) will want that boat sold so drive a little harder on price, equipment, upgrades or future service work.
How are brokers and dealers compensated?
Dealers make a margin on the boats they sell. You can bargain for a better price but be careful to not squeeze the dealer so hard that they don’t want to deal with you in the future for service issues. Brokers are usually compensated via a fee that is based on a percentage of the selling price. The standard is 10% but that’s paid by the seller, not the buyer.
What kind of documentation do boat brokers handle?
Brokers and dealers are familiar with the specific documentation needed for the kind of boat and transaction you’ll be making. If you’re purchasing a boat for corporate or trust ownership, you’ll need specific expertise. If you’re purchasing and trying to insure a high-risk race boat, you’ll need someone knowledgeable. Depending on the vessel, marine industry paperwork can be voluminous, confusing and archaic so work with a representative you trust.
How to find a broker or dealer to work with
For dealers, look at the websites of the boat builders of the brands you’re considering. You’ll find a dealership locator or you can call and see if they sell directly. If there is more than one dealership for a specific brand nearby, visit both and see with which one you click better. Your choices will be somewhat limited by the manufacturer’s dealer network.
To find a broker, start with a local marine directory (online or in print). Check out the names of individual brokers or companies associated with published listings in the category you’re searching. If you’re looking for a specific kind of boat (racing, vintage, rare), look for a broker with similar inventory and a deep understanding of that particular market. Your choices will be limited to the inventory that’s for sale and the broker associated with it. However, you can find a broker you trust and bring him or her into the negotiation with the broker who has the listing. This will reduce the selling broker’s commission so they won’t be thrilled.
How to work with a dealer or broker during the sales process
A dealer should be willing to guide you to the right model if you’re new to boating and aren’t sure what you need. A good dealer will ask probing questions about how you plan to use your boat, where and when you’ll be boating and how you’ll be managing ongoing maintenance and service issues. Beware the dealer who sells hard from the start of the meeting without getting to know you and your particular circumstances. That isn’t an individual with whom you’ll want to form a long-term relationship. A good dealer will be looking to foster a happy (and repeat) customer rather than an immediate sale.
To start, a broker should be able to help with accurate valuation of a used boat. With access to professional versions of NADA Guides and SoldBoats that are like the Kelly Blue Book valuations for boats, a broker can provide a price range to set your expectations of what you may pay for a used boat.
A broker should guide the sea trial and survey and be present at both of these two critical parts of the sale to ensure the transaction is completed to the satisfaction of both the buyer and seller. A broker should also be available for post-sale follow up as part of the usual customer service.
Frequently Asked Questions
If I’m working with a broker on a used boat and find one for sale by owner (FSBO), can I bring him/her into the transaction?
Remember that a broker’s commission is paid by the seller so it’s unlikely you’ll find an owner that will agree to that. However, you may be able to pay for the broker’s time as your adviser yourself if you feel you need that expertise.
What happens if I buy a new boat and then move out of state?
Ask the selling dealer if there’s a branch or another dealer who could provide service and warranty work in your new area. If not, you may have to move the boat to the current dealer for repairs or you may need to work with local independent contractors. However, boat manufacturers generally won’t reimburse independents who are out of their network for warranty work.
What’s the best used boat for the money?
That is completely dependent on how you plan to use the boat so don’t start with shopping just on price. You may find a great deal on a pontoon boat but if you’re planning on sailing, no price will be good enough for that tradeoff. Choosing between center console fishing boats, jet-driven runabouts, tow boats or bow riders will be easy once you decide how you and your family will enjoy your new purchase.
What’s the best brand or model of used boat to buy?
There is no one boat that’s best for everyone although some brands will hold their value more than other brands. Some boat may be more popular in certain areas, for certain activities, and thus valued higher in different parts of the country. Start by researching pre-owned boats online and see how the prices compare. If a model/brand has been around for a few years, you’ll find either praise or lots of angry owners complaining about the same things. If you’re working with a broker, he/she should have expertise or resources they can draw on to provide more information on that model/brand. Numerous repeat buyers of a particular brand is a good sign that you’re considering a strong used boat. Boat brands that tend to hold their value the best, or near the top of the spectrum include brands such as Boston Whaler, Grady White Boats, Bertram, Viking Yachts, Hatteras and Hinckley, just to name a few.
Is a new boat a good investment?
Generally speaking, boats are depreciating assets like cars. That depreciation is significant in the first two years so a new boat will devalue fairly quickly in the beginning. That said, just like vintage cars, there are models and brands that hold their value if cared for properly. In rare circumstances, a boat may appreciate beyond its initial purchase price but usually that happens only once it becomes a classic.
How do I budget for a new or used boat purchase?
Don’t just take into account the price of a new or used boat. For both, you may need to budget for taxes, registration, insurance and financing fees. For new boats, you may pay for commissioning and added or upgraded equipment. For used boats, you may need repairs or replacement of worn or outdated equipment. For both, you’ll need to consider storage (a trailer or an in-water berth) and ongoing maintenance of equipment and cosmetics. The total cost of boat ownership can sometimes exceed the initial purchase price 20% or more.