ANSWER: Boats are either sold by yacht brokers under a “listing agreement” or “by owner.” The latter category of sales is probably familiar to you in terms of housing sales. The “by owner” yacht for sale will probably not have to pay a commission in the event it is sold. The drawback in a “for sale by owner” situation is that no yacht broker will design and carry out a campaign to market the boat and it will not appear on the multiple listing services; i.e., the potential buyer market will be quite small. Yacht brokers will tell you, and probably correctly, that more potential buyers for any given boat will mean a higher sales price (supply and demand) which should more then compensate the owner for the yacht broker's sales commission.

A “central agent” is a yacht broker with whom the owner has signed an agreement for the sale of his boat. The listing yacht broker will be responsible for preparing and executing a marketing program for the boat and will handle showings of the boat and will coordinate any purchase offers and ultimate sales. The listing yacht broker is compensated for his work, even if some other yacht broker sells the boat, by a pre-agreed fee (usually about one-third of the total 10% sales commission). The balance of the commission, about two-thirds, is paid to the yacht broker who actually sells the boat- which may or may not be the listing yacht broker!

An “open listing” is one where the owner agrees to pay a yacht broker the sales commission (still usually 10%) only in the event that the yacht broker actually sells the boat himself. Any given boat may have numerous “open listing” agreements with various yacht brokers. Some owners like this type of listing because they believe it offers a greater incentive to a large number of yacht brokers who will, presumably, therefore work harder to sell the boat. The negative aspect of an open listing is that there is no yacht broker with a built in commission and therefore no one to prepare and implement a marketing program, coordinate showings of the boat or to do any of the other things a “listing yacht broker” normally does.

ANSWER: The seller is responsible for sales commissions and pays it out of the sales price he receives. Yacht broker's commissions do not effect the price paid by a buyer, except to the extent that the seller might take less for his boat if he did not have to pay a sales commission. Normally, however, from a buyer's point of view, he should not offer more for the boat then he believes it to be worth and therefore the presence or absence of a yacht broker in the deal should not effect what price he pays.

ANSWER: Normally the listing yacht broker will bear the cost of advertising such as thumbnail ads with description and photo in boating magazines and the like. Advertising expenses such as a partial or full page ad in a boating magazine or a slip at one of the big used boat shows are almost always borne by the owner. This is because the listing yacht broker may never sell the boat or get the commission but the owner will almost always sell the boat and end up with the sales proceeds. Some yacht brokerages, such as Ardell, will credit the owner back for bona fide marketing expenses when the boat is sold.

ANSWER: Assuming that the buyer is represented by a yacht broker, the yacht broker should research sales prices of similar vessels and provide the buyer with the information he needs to make a decision as to value. The yacht broker can also provide the buyer with information about the sales prices of older vessels of the same type, so that the buyer can get a sense of what level of depreciation he is looking at after he buys the boat. The most important ingredient in determining value is the qualify of the boat being considered - a bad boat at a cheap price will almost always be a bad bargain for the buyer.

ANSWER: Yes, there are true bargains out there among quality yachts for sale. Sometimes a very good boat will sell for way under market price because of the circumstances of its owner- death, illness, lack of patience on the sellers part, etc. These boats usually pop up and disappear very quickly and you normally have to rely on the judgment and advice of your yacht broker to find one. A not uncommon source of bargains, for instance, is a boat which is placed on the market at much too high a price. Such boats often sit for long periods until the owner is well and truly sick of them and they often end up as donation boats or the owner often accepts a below market offer to put an end to it all! Remember, when it is your turn to sell your boat, an above market price often kills interest in the boat and once yacht brokers turn away from a boat it is very hard to get them interested again!

ANSWER: One of the nicest things about a large luxury yacht is that the owner does not need to be intimately involved in navigation, maintenance or day to day management of the boat- he can rely on a professional crew and simply enjoy himself. Yachting is really all about lifestyle and is very little about marine proficiency!

ANSWER: You should expect to lose a bit of your original purchase price, but maybe not much and maybe not any at all. A top quality, used luxury yacht that is twelve years old is not worth much less then an identical sistership which is only nine years old. The key here is buying quality in the first place and then maintaining the yacht so that it remains in the same or improved condition. A second key is to buy a boat which is not only of the highest possible quality but is also of a widely sought after type and style. The third key to selling your yacht without taking too much of a loss is to make sure that you did not pay too much for it in the first place!