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Go Back   SailNet Community > General Interest > General Discussion (sailing related) > "You make your money buying the boat, not selling it."
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Thread: "You make your money buying the boat, not selling it." Reply to Thread
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Topic Review (Newest First)
07-07-2013 08:01 PM
mark2gmtrans
Re: "You make your money buying the boat, not selling it."

Quote:
Originally Posted by JimMcGee View Post
Mark I wouldn't downplay the real cost of buying this way. Auctions are often selling as is boats that you may not be able to inspect - so the hidden costs can be significant.

And buying something far from home has a lot of hidden costs in either shipping the boat or traveling back and forth to work on it.

We bought five hours from home and the costs included:
  • Two hotel stays
  • Five trips to the boat (hauling tools, parts, etc.)
  • Food and fuel for all those trips
  • A one way rental (for the trip to bring her home)
  • Meals for the guy who helped me bring her home

It's really easy to underestimate your all in cost on a long distance transaction.
Jim,

I am not speculating, I have done this for many years. My primary business from 1990 to 2005 was buying and selling, primarily for export, trucks, heavy equipment, boats, and other equipment and vehicles. I bought online without ever seeing the vehicles, vessels, equipment in person more often than not. The one thing that sets me apart from the normal buyer is that at the time I was the owner of a trucking company with the right equipment to haul any piece of equipment, or vessel, or vehicle which I had purchased. I also stated in my post that in some of these auctions the general public is not allowed to purchase.

Obviously if a person is purchasing a vessel with the intentions of reselling it, then the costs must all be calculated. However, if you purchase a vessel for $3000.00 that if it had been well maintained would have brought closer to $30,000.00 you should first know that it will have issues. Then you should also know that you have to pay to get it home to your shop. If you were to spend $10,000.00 to get it fixed up and $3,000.00 on the original purchase, and you throw in another $5,000.00 fro transport and motels and what have you and you still have a $30,000.00 for $18,000.00. It is a risk if you do not know what you are doing, but if you do not know what you are doing, you will by the time you do it five or ten times.
07-07-2013 03:02 PM
JimMcGee
Re: "You make your money buying the boat, not selling it."

Quote:
Originally Posted by mark2gmtrans View Post
Insurance companies, estate sales, divorce sales, and owners who have lost their income are constant occurrences, if you are willing to travel, and to have a boat shipped or take delivery in another state you have many options. Not everyone can purchase from an insurance company, but if you are able you can get stolen and recovered vessels every single day from auctions like Insurance Auto Auctions and other sources. That is how I have bought several boats and hundreds of pieces of heavy equipment and semi trucks. You may have to do repairs, but what boat have you ever purchased used that you did not have to do some repairs.

Not every boat is logged on soldboats.com I know I never logged sales there.
Mark I wouldn't downplay the real cost of buying this way. Auctions are often selling as is boats that you may not be able to inspect - so the hidden costs can be significant.

And buying something far from home has a lot of hidden costs in either shipping the boat or traveling back and forth to work on it.

We bought five hours from home and the costs included:
  • Two hotel stays
  • Five trips to the boat (hauling tools, parts, etc.)
  • Food and fuel for all those trips
  • A one way rental (for the trip to bring her home)
  • Meals for the guy who helped me bring her home

It's really easy to underestimate your all in cost on a long distance transaction.
07-07-2013 02:57 PM
JimMcGee
Re: "You make your money buying the boat, not selling it."

This really doesn't have to be all that hard.

My experience buying houses, boats, etc. is to be nice but look out for your own interests.

If I'm up against an owner who doesn't want to come down on the price I'll counter with "I'm offering this because X". It's been surprising how often just giving a reason for the offer has broken the ice. If they still don't want to move on the price I move on. Life's too short and there are other boats out there.

Going back to that owner who's held that high price for a while can't hurt. They may have gotten to a point where they're finally ready to sell - and you might be the only taker because everyone else has written them off.

As for making money on boats - well somebody hit the lottery for $500 million - doesn't mean it's likely to happen to me. The money I spend on the boat is the same as money I'd spend on vacation, it gives me pleasure, end of story.

When it's time to sell if your boat is well maintained, clean, shiny, smells good and the lockers aren't filled with junk it will stand out from 90% of the boats on the market. That means it will likely sell faster and for a little more money than similar boats.

Hope your search is going well, you need to get on the water before the season's over
07-07-2013 01:22 PM
JulieMor
Re: "You make your money buying the boat, not selling it."

FWIW, this thread has nothing to do with our individual boat related quest. I just found the quote interesting and I was wondering what the take of those who have bought and sold is.

Minn, your comment about the 4th is accurate in the financial sense of things. But I think it's important to distinguish between an excuse, in all its various forms, and a legitimate reason, which is based in real life facts and figures.
07-06-2013 07:40 PM
Minnewaska
Re: "You make your money buying the boat, not selling it."

With he Fourth of July passed, to sell your boat takes conviction. One starts to think about paying for another winters storage. Prices start to get softer, as a result.

On the other hand, it becomes another excuse not to buy. If you had an offer accepted today, there would a only a handful of remaining weekends to enjoy it, by the time it was surveyed, closed and delivered.
07-06-2013 07:40 PM
Minnewaska
Re: "You make your money buying the boat, not selling it."

With he Fourth of July passed, to sell your boat takes conviction. One starts to think about paying for another winters storage. Prices start to get softer, as a result.

On the other hand, it becomes another excuse not to buy. If you had an offer accepted today, there would a only a handful of remaining weekends to enjoy it, by the time it was surveyed, closed and delivered.
07-06-2013 03:45 PM
tonejunkie99
Re: "You make your money buying the boat, not selling it."

personally im not convinced you can make money on used boats... I have herd of people selling boats for more than they are worth, but I haven't actually seen it or experienced it first hand. I think the point that he is making is buy in smart and right and you wont take a beating later-on. as much as I have tried to make good choices when buying boats, I have never made a profit, they take forever to sell, and the slip rent while waiting on this has always made the ordeal that much more of a pia. but I always seem drawn back into boat ownership
07-06-2013 10:34 AM
TakeFive
Re: "You make your money buying the boat, not selling it."

Julie - I suggest that you completely ignore asking price when deciding what to offer. Some boats are worth asking price. Those are the ones that will sell quickly - so quickly that you rarely see them on the market unless you have perfect timing. On other boats, the owners are dreaming. Those boats may go for asking price, but only after the owner reduces his asking price significantly.

There really is little correlation between asking price and selling price, and little way to predict how flexible a seller will be. If he has just lowered his asking price by a significant percentage, he is much less likely to come down further. OTOH, if he's had it at a high price for a year without lowering it, and offer of 20-30% below asking should not be insulting or surprising. It all depends on market conditions and seller motivation.

You need to just get an idea in your head what a boat is worth to you and negotiate to that price. If the seller isn't willing, then move on to the next boat.
07-06-2013 09:00 AM
Minnewaska
Re: "You make your money buying the boat, not selling it."

Quote:
Originally Posted by JulieMor View Post
...This is pure speculation but this could be an example of an owner who bought at or close to asking price. ....
Could be, but I see no correlation. People list their boats high all the time, for a variety of reason. Believe it or not, in some cases, the boat is worth it, despite inferior comps. In others they are just stubborn, no mater what they paid, be it more or less.

I have a buddy whose boat is for sale right now for about twice what he paid. Granted, he did a huge refit of nearly every mechanical system aboard. However, he just has a line in the water to see if there are any stupid fish out there willing to reimburse him for the cost of his refit. If one bites, he will sell and move up. If not not, he's just enjoying his boat.
07-05-2013 12:10 PM
jephotog
Re: "You make your money buying the boat, not selling it."

Quote:
Originally Posted by JulieMor View Post
In our search we ran across a boat that appears to have been originally listed in 2007. It looks like the same owner. The original asking price was high (no surprise there!) Then he dropped it 20% after a couple of years. Then another 5% and has stayed there since.
I don't think anything that has happened in the last 6 years is indicative of long term values. In this time people have sunk their boats to avoid paying marina fees, have had their houses foreclosed on and parked their multi-million dollar jets to avoid paying the insurance.

If you wanted to sell any asset 2007 was the time to do it. Probably 2011 was the best time to buy anything as it looks like prices are going up. I still think the prices are fairly depressed compared to long term valuation and it is still a buyers market.
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