Great brokerage bargains for boat buyers as market heats up

by Jeni Bone on 23 Jun 2011 Peter Nicholson, Broker at Ensign Ship Brokers, says it’s a very exciting time in the 'pre-loved' boat market.

'There’s a lot of activity at the moment, buying and selling,' he says, adding that buyers can find great bargains, from $20,000 to $6m boats, across the range. 'As far as pricing, there’s downward pressure. It’s a buyer’s market. People can expect 5-10% beneath the asking price. But for sellers, depreciation depends on the boat, its age, hours, condition, make and model.'

Peter reports sales have been fairly strong in Gladstone and the Gold Coast is doing well. 'But we are selling product to people all over Australia. There were people here over the Sanctuary Cove weekend who bought and their boats are heading their way now. We sold a Meridien 411 for half a million, which is going to Sydney from the Gold Coast. And we have boats going to Townsville and Groot Eylandt.'

With offices in Sydney, on the Gold Coast, Manly Brisbane and Gladstone north Queensland, Ensign has a large catchment of product, around 500 boats on its books.

'Ensign is the largest independent brokerage in Australia. Having 500 boats in brokerage gives us large capability too – people end up buying their next boat from us.'

From a market frantic with people upgrading, buying sideways, trading down, getting out of boating altogether, Peter says there are a few emerging trends.

'We have seen a lot of interest in first time yachting, particularly sail. People entering the market for the first time attracted to the lifestyle, and looking for a large cruising boat to live aboard, both new and old. The grey nomad segment is cash up. They’ve done the campervan trip and now they’re ready for the next challenge, sailing.'

According to Peter, this older market – frequently overlooked by every sector – is 'an interesting evolving market in power and sail, as well as houseboats'.

'Particularly in Queensland, where you can still live on a houseboat!'

Another trend is the rash of 'private imports', boats brought in from Europe and the US which are making things harder for people to sell their used boats.

'Imported boats, bought when the Australian dollar was low, are now having to compete with imported boats coming in as ‘grey imports’ rather than through the dealer network three to four years ago. There’s a lot of product out there.'

The importance of consulting a broker with the expertise gained over years in the industry cannot be overstated.

'Brokers have an understanding the market place, they know the product and are able to work with buyers to identify their real needs and match their expectations with product. Then, we are skilled at handling the negotiations between vendor and buyer, the intricacies of the paperwork and guidance through sea trials and surveys, establishing the vessels have clear title and can be sold, so when we hand them over, it all goes smoothly. Brokers also manage the marketing and merchandising.'

Peter says he has seen and heard of 'plenty of people buying overseas, private imports thinking they’re getting a good deal, and then suffering remorse when something goes wrong'.

'Most times they are non-compliant, in terms of electronics and internal electrics. People are potentially buying a hazard. Then there’s freight, GST on American boats and additional duty of 5% on foreign builds coming in from the US. Brokers can navigate these topics with people. We can help them by showing them some of the potential pitfalls.'

More at www.ensignbrokers.com.au

BIAA have put out a brochure 'Thinking of Importing Your Next Boat'.