Let’s take a minute and discuss pricing your boat when you want to sell it. Yes it is up to you how you price it, we can give you suggestions but ultimately it is your decision. That being said if you realistically want to sell your boat in the next year you have to price it in a range that will attract attention from buyers and seriously takes into account the condition of your boat.
There are a few things to consider when you are pricing your boat for sale:
Notice how at no point did I say, how much you spent on improvements to your boat. The market doesn’t care what you spent on your rigging, bottom paint or upgrading your interior. It will always be judged based on it’s value relative to the rest of the boats in the same class. Spending $20,000 on any improvement does not mean you get to add $20,000 to the price it just means you get to price it near other boats in the same condition. This might be something to consider before you embark on a $40,000 refit of your 1982 Catalina 30.
So what does matter? What matters is the quality of your boat relative to the other available options, which is to say the three points above.
Except in rare occasions you can almost always find a comp that is close enough to the quality of your boat to make a fairly accurate judgment about what your boat likely would sell for. This is how buyers are judging as well! Is this enough information to make a perfect decision, no, but it can get you into a realm of possibility. I promise you your buyer is always looking at the other boats available, and if you are asking 30% more than every other boat there is almost no likelihood that you will even get an offer or even any calls about your boat.
Another issue to consider is this, if you do happen to get an offer that is significantly higher than the other comparable sales (fat chance) once that boat goes to Survey there is a good chance the Surveyor isn’t going to value the boat as high as the Offer, meaning the buyer might not be able to get insurance for the total amount of the boat. This would kill any chance to get financing, and even if financing isn’t involved a buyer is highly unlikely to go through with a sale when the surveyor is telling them they are overpaying.
So lets narrow it down. How should we price our boat? Realistically you should be a no more than 10-15% higher than the next most similar boat and that is only if your boat is in absolutely pristine condition and you are in no hurry to sell. If you do wan to sell in say 9 months or less, then you should probably price within 5% of the next most similar boat and expect that you may have to do a price reduction.
Bear in mind that no buyer is going to offer full price on a boat, unless maybe you price 10-20% below market, so you can always leave a little room above your target price. You also shouldn’t be afraid to say no to a low ball offer or to counter any offer at a reasonable price. Your broker should be able to guide you through this process based on your goals, this is a big part of what they do for you.
I promise if you keep these thoughts in mind as you work on pricing your boat you will have a much easier and less stressful sale.
Would love to hear your comments on these thoughts.