Interesting topic from our Fabulous Forums…
From time to time people bitch about boat brokers and voice this idea that they’ll save money by cutting them out — like this guy who wants to buy an unlisted J/105 (good luck).
I am more than sufficiently experienced in purchasing and selling boats, most of the J/105 listings are available on the internet, and I do not want to pay a higher price due to broker’s commission. Having said that, I would consider paying broker a finders fee if and when I purchased a boat that he/she found for me.
This is bunk. As a buyer, skipping the broker you won’t get a lower price for reasons mostly having to do with psychology and market economics that are out of your control.
1. Market size. By cutting out the broker-sold boats, you’re restricting yourself to a much smaller market. Even if you were saving the broker premium (you are not — see below), is it really worth saving 10% to miss out on the best boats? Buyers gain the most when they can force sellers to compete, simple supply/demand.
2. Market sets price, not brokers. Any reasonable seller (do those exist?) is going to match his asking price to whatever the market price is — and the market price is generally set by the broker-listed bosts on Yachtworld. No seller says… “I’ll cut out the broker, do extra work myself, and pass on those savings to the buyer”. No, every one of them is thinking “I’ll pocket that 10% difference.” At best, the “deal” you get is that they knock 10% off the listing price and that’s the no-broker discount. But realistic sellers price in room to negotiate anyway, so you’re really only getting the same deal any broker-listed boat would have give you.
3. Avoiding the Cheap Bastards. Sellers who want to avoid a broker are the cheapest and most unreasonable people out there. These are the math geniuses who would rather pay years of slip fees than give a broker the satisfaction of clawing one dime from their sale. And you think they are going to give you a deal? Ha! These guys are going to nickle & dime you every step of the way and almost certainly cheaped out on maintenance too. Unrepresented sellers are a market-signaling mechanism you want to pay attention to — and you are trying to seek them out!?!