No room for negotiation?

[rabbi]

The cat market is different these days than it used to be.

If one owns a decent mainstream cat in good shape serious buyers just line up.
We listed in September priced in the top price range for the age. We had a listing broker but only for marketing on the large websites. We received all inquiries unfiltered and dealt with the buyers directly.

We had lots of blind low ball offers which were met with a 1 line response if any at all. Some people think their budget should determine the price and not the market. And many follow their rule of thumb. These folks likely don't own a cat today.
We had a few more reasonable offers (>90%), and a handful of people interested at asking price. All within days and weeks after listing.
During two weeks under offer we continued to receive serious offers up to 10% above asking price, even through buyers brokers.

That is just the reality for buyers of recent cats these days.

And I expect the market will get worse as Irma reduced the ongoing supply of used charter cats dramatically for the next 3-4 years.
If supply is reduce but demand remains stable then there is unmet demand piling up, increasing prices much more than just a small imbalance between supply and demand.


If you have the time just step aside and wait. This may change quickly in maybe 5 years when all the recent builds enter the used markets, and manufacturers run into overcapacity. Unless another Irma comes along...

[letsgetsailing3]

Originally Posted by Scout 30

Market value is the most probable price that a boat should bring in a competitive & open market, based on a reasonable exposure time, with both the buyer & seller being knowledgeable. What a boat sells for is the Sale Price which can be above or below market value. Simply wanting to get more for your boat, for whatever reason, does not make it worth more and if a buyer is dumb enough to pay more for a boat because the seller spent a lot on breakfast that would increase the sale price but not the market value of the boat.

If you have 2 identical boats for sale sitting side by side at a marina and one is for sale by owner while the other is listed with a broker they are both "worth" the same amount. If you attempt to roll the Broker's commission into your list price a prospective buyer will simply buy the adjacent FSBO boat.

You're thinking of "efficient market" that you maybe heard about in an introductory economics class, but the boat market is anything but that.


Efficient or not, however, brokers will get a cut of the negotiation if they're involved in a boat deal.

[Scout 30]

[QUOTE=letsgetsailing3;2828911]You're thinking of "efficient market" that you maybe heard about in an introductory economics class, but the boat market is anything but that.


I'm not sure efficient is the correct term. However, a competitive & open market is required. There seems to be a recurring theme here that Yacht Brokers are evil & that there is widespread manipulation of the market by misrepresenting sale prices. I don't believe it & I don't think anyone on this thread has any proof of this. Yacht Brokers are licensed & regulated & would risk both their license as well as their access to multiple listing services like YachtWorld if they were regularly committing fraud. In addition many of these boats are bought with very large loans making them Federally related transactions. Anyone engaging in a scheme to intentionally and fraudulently inflate boat prices would run afoul of the Banks & could face criminal prosecution.

I'm not a Broker but I have used and abused quite a few & have only been treated ethically, honestly & with more patience than I probably deserved. There's nothing wrong with relating a bad experience but generalizing about a whole profession is wrong.

[letsgetsailing3]

[QUOTE=Scout 30;2828936]

Originally Posted by letsgetsailing3

You're thinking of "efficient market" that you maybe heard about in an introductory economics class, but the boat market is anything but that.


I'm not sure efficient is the correct term. However, a competitive & open market is required. There seems to be a recurring theme here that Yacht Brokers are evil & that there is widespread manipulation of the market by misrepresenting sale prices. I don't believe it & I don't think anyone on this thread has any proof of this. Yacht Brokers are licensed & regulated & would risk both their license as well as their access to multiple listing services like YachtWorld if they were regularly committing fraud. In addition many of these boats are bought with very large loans making them Federally related transactions. Anyone engaging in a scheme to intentionally and fraudulently inflate boat prices would run afoul of the Banks & could face criminal prosecution.

I'm not a Broker but I have used and abused quite a few & have only been treated ethically, honestly & with more patience than I probably deserved. There's nothing wrong with relating a bad experience but generalizing about a whole profession is wrong.

I don't think they're evil. I just take exception to the idea that they're "free".

[hellosailor]

Yacht brokers are not necessarily any more evil than the top-name department stores, or your local supermarket.

Department stores may advertise "cashmere sweater" $149.95 on sale for $64.95, when in fact they've never sold them at the higher price, or just listed them at that price for two weeks, knowing they wouldn't sell until the "great sale" reduction.

Or your supermarket, that sells brand-name mayonnaise for $5.79 a bottle, then regularly puts it on sale for the same $3.25 that Walmart sells it for every day.

Are they evil for using different price strategies? Not necessarily.

But the brokers who glibly say "I haven't had a chance to look at the boat" when you call to ask if there are any deck leaks or obvious problems, because they would rather play dumb and let you waste the day (or weekend) finding out for yourself...I'd argue they go on the evil list.

Sales, big ticket commissioned sales, is not an easy game. And there are some honest brokers out there. Sometimes honest and hard-working as well. But overall? Really, you're talking about used-car salesmen who prefer bigger-ticket sales and topsiders, from what many folks have found. Is it that bad? Maybe not. But bad enough to give that perception.

And I know it isn't limited to brokers. I've even spoken to various "executives" and "bankers" who say flat out "We would have never said that" and, gee, you could hear a pin drop when you can say "Do you want to hear the tape?" back to them.

That's why we still remember "Caveat Emptor" even if we can't remember who first said it.

[Scout 30]

[QUOTE=letsgetsailing3;2828945]

Originally Posted by Scout 30

I don't think they're evil. I just take exception to the idea that they're "free".

Brokers services aren't free and they shouldn't be. The seller pays the Brokers fee. If the buyer hires a Broker he splits the fee with the listing Broker. If the boat is a FSBO then the buyer pays his Broker's fee. If you're back to saying that a boat listed by a Broker sells for more because the seller's costs are higher, well, I've been a property appraiser for close to 30 years & I can tell you you're just plain wrong. The market value of a boat has nothing to do with the seller's expenses. However, a boat listed with a Broker could very well sell for more than a boat that's for sale by owner simply because the Broker is good at his job.

[tomfl]

Originally Posted by smj

A surveyor that doesn’t give his opinion of price or value would be out of work as that is a major part of his job, both for your benefit and the insurance companies.
We have sold quite a few cats and all sold close to asking price and reasonably fast. An offer of 65% wouldn’t warrant a reply from me.

The key words here being 'insurance companies'. I called up a couple of insurance companies before buying and got their input about what a my potential boat could be insured for. Kinda like asking if you could insure a Yugo for $US100,000, or a BMW for $US75,000.


Another thing I have noticed is that a lot of monohull owners are commenting in this thread. As Boaty responded we are talking about whole boats; not half boats. I have seen many monohulls sold for what I considered give away prices because the owner wanted out from under ownership. Can't the same for what I call real cats (like the OP mentioned) as opposed to 1980 plywood boats.

[DockDoc]

Closure

As my profile now states I own a 2017 42 Lagoon OV cat.
I paid....... Full Price.

Why?
1. The owner had already previously reduced it.
2. The owner, who I met and stay in contact with, was a 60+ guy, South African Olympic team sailor who had the boat tricked out with every imaginable top of the line gear, sails, nav equip, electronics, LiPo battery banks, inverters, anchors + all chain rode, top end upgrade motors with low hours etc etc. The survey guy basically said the boat was spotless, no issues, and the dollar evaluation came in at 200k over what I was paying.
3. I wanted it. I had set aside 2 months to sail her from the Caribbean back to the Chesapeake and I didn't have the time to wait for other cats to come up. I could have chartered for two months but that would have cost me more than any price reduction that might have occurred.

I sailed for over 30 days, 2500 NM with friends and family. It was like falling in love every day with the best looking gal you could imagine. Sure I had issues, impeller failed, lighting strike near the boat caused electronics to go wonky, a tiny caulking weak point caused a deck leak, US voltage vs EU voltage and other minor issues. But I was so glad I choose to be aboard for all of the voyages rather than have her delivered by a paid captain and crew. I learned a ton about the boat, her systems, what she likes and what she doesn't.
I absolutely love the boat, got her to 15.8 SOG (that's with the gulf stream pushing 3 knots), and I can't wait to get sailing again.
To those who I disparaged by saying 'never full price,' I am having my second serving of crow. Sometimes full price IS the best deal!
Cheers all and see you on the water!

[Zzmeyer]

DockDoc - You nailed it. You got the boat you wanted at a price you determined is fair. Nothing like buying something you don't really want at a great price. One of the nice things about a boat is it very seldom makes economic sense. I'm happy for you.

[DeValency]

Congratulations, DockDoc!
Sounds like you were able to even add more happy days over your buying day... - what could a sailor ask for?
As for the price; as described, the boat justified paying the price with the described perfect condition and upgrades. We all know the actual cost of refitting - personally, I’m just in the middle of it - heading to St Lucia every two months as I couldn’t close and refit early enough to sail up to New England before the summer.
Enjoy the summer sailing!

[Kenomac]

Congratulations! You got the best deal, the kind of deal I was trying to explain in my posts, but nobody was listening... just criticizing.

Our 53, which is probably one of the nicest available for sale did not sell this year, so next week I’ll begin enjoying the boat myself for the next four months in the Med. The buyers with their low ball offers..... they won’t be enjoying the next four months on an Oyster 53 in the Med.

Have fun!

[smj]

Originally Posted by Kenomac

Congratulations! You got the best deal, the kind of deal I was trying to explain in my posts, but nobody was listening... just criticizing.

Our 53, which is probably one of the nicest available for sale did not sell this year, so next week I’ll begin enjoying the boat myself for the next four months in the Med. The buyers with their low ball offers..... they won’t be enjoying the next four months on an Oyster 53 in the Med.

Have fun!

Or maybe they are enjoying the Med for the next 4 months on a boat other than yours? Not criticizing just looking at reality.

[FlyingScot]

Want to share what you paid so we can get a feel for the deal?

Regardless I'm glad you bought a boat you like. Have fun, be safe.

[Kenomac]

Originally Posted by smj

Or maybe they are enjoying the Med for the next 4 months on a boat other than yours? Not criticizing just looking at reality.

Reality: Two of them came back with two more ridiculous offers just a week ago having never seem the boat, so I’m casting off for Greece a week from Saturday with 2 friends.

[Barra]

Originally Posted by rabbi

The cat market is different these days than it used to be.

If one owns a decent mainstream cat in good shape serious buyers just line up.
We listed in September priced in the top price range for the age. We had a listing broker but only for marketing on the large websites. We received all inquiries unfiltered and dealt with the buyers directly.

We had lots of blind low ball offers which were met with a 1 line response if any at all. Some people think their budget should determine the price and not the market. And many follow their rule of thumb. These folks likely don't own a cat today.
We had a few more reasonable offers (>90%), and a handful of people interested at asking price. All within days and weeks after listing.
During two weeks under offer we continued to receive serious offers up to 10% above asking price, even through buyers brokers.

That is just the reality for buyers of recent cats these days.

And I expect the market will get worse as Irma reduced the ongoing supply of used charter cats dramatically for the next 3-4 years.
If supply is reduce but demand remains stable then there is unmet demand piling up, increasing prices much more than just a small imbalance between supply and demand.


If you have the time just step aside and wait. This may change quickly in maybe 5 years when all the recent builds enter the used markets, and manufacturers run into overcapacity. Unless another Irma comes along...

yep wise words these. I sold my cat 2 weeks before irma so missed out on the uplift in the market but it seems pretty obvious that (another irma aside) there is going to be another glut in the charter cat market in around 4 to 5 years time. Just like last time that will drag down the owner versions as well.