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  #1  
Old 10-06-2010
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Yacht Broker - how to deal with them?

The used car salesman and new car salesman are often viewed as untrustworthy character by the public. Do yacht brokers suffer the same fate?

1. In real estate, brokers have (somewhat) a standard fee for listing, does YB have a standard fee also (percent)?
2. How does the selling broker split the commission with the buying broker?
3. Should one use one broker exclusively, or use as many as one sees fit? Who ever find you the best boat wins. In reality, I probably find the boat myself, call and deal the broker directly. What is your take?
4. What is the dealer profit of selling a new boat and the commission for the brokers. Do those figures make public like new car dealers?

I am sure I may be overly simplified the industry of selling and buying yachts. If you want to be critical, I would like to hear that. Please refrain your criticisms without offering answers. One liner answer like "Well..... it all depends" is not a answer.

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Old 10-06-2010
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The typical commission for a yacht broker is 10% of the selling price.

If you are listing a boat, there is only ONE LISTING BROKER, since that generally most listing agreements require exclusivity to protect their commission.

Unfortunately, there's no real standard for a buyer's broker in the yacht world, unlike real estate, so the terms vary.
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I just bought my first boat less than a month ago, so I can offer you some current info. I talked to a few different brokers. One of them was rather used-car-salesman-esque, I didn't like him. I eventually settled on one who was highly recommended both here on sailnet and by the author of a book I read. Everyone seems to say "find a broker you trust", and that's what I did. I discovered a number of clients that had used my broker multiple times, for both buying and selling. Every boat I saw, I saw through him. He never asked me to sign anything saying I was exclusively using him, nor did he mention it, but I got the distinct impression he expected me to not use other brokers. A good number of the boats I saw were his suggestions, but more than half were ones I found on yachtworld and expressed interest to him (including the one I bought). He'd then call the listing broker and get the inside scoop, and if that sounded good, set up a showing.

I have heard the commission is 10%, as SD said. I believe it is split equally, 5% to the listing broker, 5% to the selling broker. If the broker represents both the buyer and the seller, I believe he pockets all 10%. That situation nearly happened as I had an offer on a boat my broker had listed, but the deal fell through. I felt like he kept a good balance of the interests between me and his other customer (the seller). I told him the information he needed to know, and I consulted with him during the negotiations to get his reaction on how much I should raise my offer, but I was careful not to give him too much info that he might accidentally let slip to the sellers.
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Old 10-06-2010
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Thanks Again, SD. It is a good to know and a good start as I embark the journey of acquiring my first keel boat.

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I am old school. Integrity is to do the right thing even when no one is watching.
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Old 10-06-2010
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rmeador, judging from your experience, it looks like you got yourself a great broker whom has the integrity and passion about serving his clients. If I live near you, I would want to talk to him.

Thanks for taking time to reply.
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I am old school. Integrity is to do the right thing even when no one is watching.
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Hey,

IMHO, the ratio of good brokers to 'used car salesman type's is probably 25% to 75%, meaning that 3 out of 4 brokers are not good.

While I think the concept of a buying broker is nice, I don't know how that would work in the real world. For example, when I bought my second boat I looked all over the Long Island Sound, from the North Fork of Long Island to Mystic CT. I used Yachtworld primarily, and when I found an interesting boat I would email the broker. If I liked the response I would call and if I was still interested I would visit. What would a buyer's broker do in this situation? Perhaps it was because I was looking at cheap boats (28-32' boats for under $20K in ready to sail condition) but there often a big discrepancy between how the boat was presented in the ad and how the boat appeared in person. I don't believe that a buyer's broker would be willing to travel all over the place to earn perhaps $1000, but maybe I'm wrong.

In any case I learned to forget about boats represented by sleazy characters and only deal with people I felt were trustworthy.

To date, I have bought two boats from brokers, and each time I was satisified with the deal and I would recommend the broker again.

Barry
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Many brokers aren't going to be very motivated to help you with sales of smaller, older boats... budget has a lot to do with it, since a boat broker would rather help a customer buy a $500,000 boat, than they would a $20,000 boat. The really good brokers will help you buy a $20,000, and are looking at you as a long-term investment... hoping that you will buy your future boats through them and sell your boats through them as well.
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Old 10-06-2010
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Quote:
Originally Posted by sailingdog View Post
The really good brokers will help you buy a $20,000, and are looking at you as a long-term investment... hoping that you will buy your future boats through them and sell your boats through them as well.
This is very, very true, and an easy way to discern a stand-up broker from a sleeze.

Also, it should be very apparent by a broker's listings what they specialize in. Someone listing a majority of sailboats will be way more helpful to you than someone listing mostly power.

There are many negative things that can be said about brokers, but I don't think it's fair to compare them to car salesmen etc. A good broker may be hard to find, but a good broker is a tremendous asset when it comes to yachts, and will try to keep you as a client for life.
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Quote:
Originally Posted by rmeador View Post
.. If the broker represents both the buyer and the seller, I believe he pockets all 10%. ...
I concur with your advice about the use of a broker, but I want to clarify that the broker represents the seller, and if you work "with" a broker who introduces you to another broker's listing, "your" broker is also representing the seller, who pays both.
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Last edited by sailingfool; 10-07-2010 at 06:37 PM.
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