By selling smartly you can easily increase the amount you can put down on your new purchase.
Like most things in life, you need to plan the process (yes I know boring huh?). But do this and you'll not only get the very best price, but you'll minimize the effort and time involved as well.
Make sure you cover these four important areas and you will be laughing all the way to the boat shop:
- setting a price
- deciding on how to sell it
- boat preparation
- doing the deal and paperwork
The main mistake made by boat sellers is pricing the boat either too low or too high. Too low and people will think there is something seriously wrong with it or an unscrupulous dealer will snap your hand off and make a hefty profit. Price it too high and you can't get rid of it.
What you need to do:
a) Check your local newspaper classifieds, to see what identical boats are going for in your area (don't forget that those are asking prices). If you cut these out you can show these to potential buyers what similar boats are selling for.
b) Talk to local dealers and see what similar models they have available, be careful if they make you an offer as it will usually sell for more privately.
c) Of course look at internet sites, you can do a lot of price research at the click of a mouse. Make sure you compare like for like as there are a lot of variations on spec's.
d) Check out the marine blue book value (NADA and ABOS) which you'll find at your bank, insurance agent, or boat dealership. Make sure you are honest about the exact details to get a realistic price.
How and when to sell it
You have three basic choices: sell it yourself, trade it in, or sell it through a broker:
You have choices of which Blue Book value boats make by the method of selling, it is usually influenced by the size and value of your boat. If your boat is small it is unlikely a broker would want to get involved as there is no profit for them, if it is large it will probably involve complex paperwork and negotiations so you may want to pass it to a broker.
Selling the boat yourself should make you the most money, but you have to do all the work. Decide your budget and plan your advertising campaign. Classified ads in a local newspaper are an obvious choice, but you could look at magazines, especially for bigger boats. Internet sites attract buyers across the country and worldwide. Don't forget to post ads on yacht club bulletin boards and add a "For Sale" sign on the boat if your marina allows it. Make sure you tell as many people as possible, try to get a bidding war going!
Trading in your boat is easy when you're buying a new boat, but most dealers won't take trades on used boats. Unless you are a master haggler you are unlikely to get anywhere near the blue book value.
Incidentally, the best time to sell your boat is the beginning of the boating season when buyers are most interested. If you try to sell off-season you will have difficulty getting the best price.
The same is true for trade-ins, because the dealer can't turn the boat over as quickly off-season.
Brokers
A yacht broker is like a real estate agent, they advertise and showcase your boat to potential clients. They also handle the legal paperwork, and take a percentage of the selling price as a commission, usually between 5 to 10 percent. Use brokers who specialize in boats similar to yours, since they are likely to have more serious buyers.
Usually a buyer of your boat will pay for a marine survey, (an inspection to determine the condition of the boat) this can be used to negotiate the price downwards to compensate for any problems that are discovered. Try to second guess the survey by getting problems fixed before advertising, it will be much cheaper.
Boat Preparation
The golden rule is 'a clean and tidy boat always earns a higher selling price'. You will have to invest some time and elbow grease but it will be worth it.
Scrub the entire boat and deck with mild detergent and a soft brush. To make the fiberglass shine have it buffed with rubbing compound and polished with wax, on small boats, you can do this yourself using an automotive buffing wheel. Make sure your varnish is in good condition or give it one coat, if the teak is gray, bleach it or oil it, too. Clean the bilge to make sure there are no smells to make the boat seem old.
Give the head and shower a good clean and add a double dose of chemicals to the holding tank. Repair any broken equipment, get the engine steam cleaned if necessary, touch up any spots of corrosion and change the oil. Make sure the engine starts immediately by charging the batteries, these are all things buyers check to see how well the boat has been maintained.
Give the galley a good clean and if you can remove the carpet, shampoo it and let it dry in the sun. Get the curtains and upholstery cleaned. Scrub the covers and Bimini top and clean or replace the side curtains if necessary. De-clutter anything that is non-standard, poorly installed or not for sale with the boat.
Sell the lifestyle! Put drinks glasses and plates on the table, see how they do it in the magazines - resist temptation to model yourself though! Put together a mini brochure to show buyers with photos of the boat in the water (not too many so they think the boat is older than you say), any old instruction manuals and brochures with a list of the specification and included items.
The Final Paperwork
Great you have done the deal, all you need to do now is the boring paperwork. If you ensure this is done correctly it will save any problems in the future. Type up a bill of sale including:
- price
- model and spec of boat
- registration numbers
- equipment included
- buyer and seller names and addresses
- driver's license numbers
Provide a receipt if you are taking a down-payment and you could make the deposit non-refundable so you reduce time-wasters. Ask for a cashier's or certified check for both the deposit and the balance. Agree the date for final payment and delivery/collection.
If a buyer wants a sea trial, make sure that you have an agreement that buyer will pay any costs for launching or refueling and you have non-refundable deposit in hand, also ensure you have any relevant insurance cover.
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