Diane interviews a couple brokers, Melanie / Marcy of Sunshine Cruising, for tips and tricks on how to best sell without a broker and also common pitfalls that lead you to listing with a broker for help.
They discuss market conditions since Covid and how the market has changed recently. They talk about quasi-broker deals where the costs are less, but you get the fiduciary and legal security of the brokerage.
We were hesistant about interviewing yacht brokers as this website is an advocate of the FSBO approach, but Melanie and Marcy provide excellent, helpful information. Sunshine Cruising has a catamaran specific program and is headquartered in St Augustine, Florida, USA.
Website: Sunshine Cruising Cats
Transcript
Welcome to another CatamaranSite interview. This time, I’m with Melanie and Marcy, and they are going to talk to us. They’re from Sunshine Cruising, and we’re going to talk about brokers, which is a bit of a surprise for a site like this, but I think they have a lot to add. Marcy and Melanie, can you tell us about yourselves? Maybe start, Melanie.
Melanie
We founded Sunshine Cruising about about three-and-a-half years ago. My boating background is fairly extensive. I grew up living aboard a sailboat and cruising up and down the East Coast and Bahamas. I always tell people we were like YouTubers before there was YouTube. We wrote for magazines and stuff.
So anyway, I started selling boats about eight years ago. Then in February 2020, I was with another brokerage, and decided to open my own brokerage. I opened it up in February, Marcy helped me. She was part of the founding crew. So it was just myself, and Marcy, and one other guy in the trenches. We opened the company February 5th of 2020, and then the whole world shut down a few weeks later. It’s been a really interesting ride, and interesting to see all the changes in the market and industry. It was one of those things that it could have been the very worst time to open a brokerage. It turned out to have a silver lining and that it was a very busy time. Things are still settling out now.
We’re on the East Coast, we’re in St. Augustine. St. Augustine is a huge catamaran destination because we have one of the few marinas, the St. Augustine Marine Center here, that has a lift wide enough to haul the big cats. St. Augustine, Fort Lauderdale in Florida, those are the two places that people go to look at and buy and sell cats. We work with folks all over the place. We have a broker in Tahiti, we have ten different brokers at the moment. Marcy and I are pretty much the most most active.
How about you, Marcy, how did you get into selling boats?
Marcy
I grew up on powerboats in Ontario, Canada. My grandparents had a cabin on a lake in the Frontenac Provincial Park. Power boats, canoes, a lake girl really. That was the extent of my knowledge until I started hanging out a little bit more with Melanie, and Melanie’s like, “We’re going to show you sailboats! We’re going to show you a little something different.”
She asked me to join the team, and it has been one of the most amazing and exciting things I have ever done, I love it. I like to tell people I have fun, and while I’m having fun, I sell boats. Everything’s just been fantastic. As she mentioned, the pandemic threw things a little crazy, but it was a great time to start the business. We’re starting to see things normalize now, but it’s still a great time to buy and sell boats.
Tell us a little bit about your catamarans. Specifically, what kind of percentage do they make up, and what’s your experience with catamarans?
Melanie
It’s interesting. My background was on a monohull, I was on a 47 foot Gulfstar. Most of the sailing I’ve done has been monohulls. I was living on a 35 Island Packet when I started the company. It’s just sort of by default, I sold a lot of Island Packets, I sold a lot of monohulls that were similar to where I have my experience.
I realized when I was with my last brokerage, Edwards Yacht Sales, that I had to learn about catamarans. The cat that made me fall in love was, a Manta 42. I loved it, one of my favorite boats. Then I sold a couple of Geminis, then the Manta, several Lagoons. We’ve sold most of the major major types.
You learn so much about boats when you’re doing surveys and trial-arounds. I thought I knew a lot about different kinds of boats before I started selling them. You realize every different boat you go on, every different boat you sail, you get to know the characteristics.
We probably, right now, a third of the deals that we have going on are cats. We have a Seawind under contract, we have a Gemini, a Catalac, a Kennex, those are the ones that are under contract right now. Then listings, we have a Lagoon, it’s a 400, and a Prout. Working on another one soon.
It sounds like a real range of boats. Often, we’re on CatamaranSite, it’s for people who are working to sell their own boats. Why is it sometimes great to sell your own boat? What are the benefits of going without a broker?
Melanie
We always tell people, and I’ve always told people, if you want to do it yourself, do it! I would never discourage somebody from selling a boat themselves. Obviously, the main advantage is that you don’t have to pay a commission. The seller in the deal is just like a real estate transaction, the seller is someone who pays the commission, they benefit to both the buyer and the seller. Obviously is that the buyer can theoretically get the boat for less, and the seller doesn’t have to pay a commission.
I think also, nobody knows your boat like you do. I can learn about it when I go to list a boat. Usually, the first thing I say is, “Hey, give me a tour of the boat like you’re trying to sell it to me. Tell me what you like about.” I think having the knowledge about it, and obviously the financial aspect, are two good reasons to do it on your own.
What tends to happen, and I’ve owned I think five boat as an adult, and I’ve always sold them on my own until recently, when I had access to brokerage tools. There’s a point where people realize that it’s a lot of work. There’s a lot of paperwork, you’re fielding lots of different phone calls, you’re showing the boats. It takes on average, ten times to show a boat, or ten showings before you get it under contract. It’s a very time consuming thing.
There are a lot of people who start out selling the boat themselves, but then they have to move home. They’re from the Midwest and they’ve been cruising, and leave their boat in Florida. That’s part of that turning point where people decide to go with a broker.
That’s a really interesting statistic, the ten showings per [contract]. When talking about that Marcy, did you want to jump in on that one?
Marcy
Just to comment, we’re actually helping a good example right now. We’re help helping a for sale by owner with a Manta Mark IV, they found their own buyer, but the financial and the legal aspects of it, both sides felt very comfortable having a broker involved. We are helping with legal contracts, the fiduciary holding, the escrow. Helping to manage every step of the way as they go through the survey process, and the conditional acceptance and stuff, and having the documents to keep both parties feeling good, feeling safe, and being excited about the process. That’s kind of a hybrid in between a true for sale by owner, and going with the brokerage. We’ve met some people in the middle.
Tell me a little bit more about what is a hybrid offering. Something you do regularly, or is that something people approached you with?
Melanie
It tends to be something that people approach us with, it’s not a normal practice. Selling boats, the brokerage takes on a lot of responsibility and liability, handling paperwork, and that’s sort of the scary part of it. We started to realize, most of the boats that we list, we’ve met the owners when they were for sale by owner. We’ve told them, “Hey, continue, do this yourself. If you want us to help at some point, we can step in, and we negotiate a reduced commission in that situation.” Obviously, because we’re not the ones advertising the boat, but we are the ones picking up the work on the tail end of it.
It’s something we’ve started to see more and more. You guys know well, in the last couple years the catamaran market’s been kind of crazy. It’s been fairly easy for people to sell boats on their own. I mean, throughout the ten showings for a boat, that’s across the board but it’s also not during Covid time. I had a Lagoon, I think it was a 45, during the height of the the catamaran frenzy. Beautiful boat, it was only a couple years old, great, just kept perfectly. I listed it, and within 24 hours had three offers above asking price, and under contract. That was the market. In that market, it’s a lot easier for folks to sell the boat on their own just because the demand is there, but it’s definitely getting back to a normal market.
In a more normal market, when you’ve stepped in and people have decided to go with a broker, what are you seeing as some common mistakes that people might be making when they’re trying to sell them themselves that you as a broker are able to help them correct?
Melanie
One of the biggest things, obviously, is not prepping a boat well enough. I’m sitting in my house right now, and I apologize if the dog barks, but I look around and I don’t see my mess. But somebody else is going to come in and look around and see I just moved, so it’s a huge mess. If you’re living on your boat, for example, which I’ve lived aboard for a long time. If you’re living on your boat and you have a lot of stuff, people don’t clean up their clutter. That’s one of the big things because somebody wants to go aboard that boat and envision themselves on the boat. They don’t want to go aboard the boat and open a closet and it’s full of somebody else’s clothes.
Getting getting rid of the clutter, taking care of the cosmetic stuff. Most of us that are serious cruisers, or have been in this world a long time, we know that the cosmetic stuff is important, but it’s not the most important thing. So they’re people that will let the cosmetics go in favor of having a mechanically sound boat. You have to do it all. We’re talking about things like cleaning the engine compartments, cleaning your engines themselves, making sure it’s very easy. It’s not that easy to wirebrush, and paint. The things like that when you’re in a normal day-to-day relationship with your boat, you don’t.
Beyond prepping and cleaning, what are some other things that you find people haven’t quite got right?
Melanie
I think pricing is one of those, and that’s something. We all know there’s asking price and there’s getting price, selling price. Boats are a very emotional thing. We’re emotionally attached to our boats. To us the boat can be worth something different than what the market says it’s worth.
We work with a lot of folks that, once they start working with us, we’re able to show them. You can go online and and look at whatever a Manta is listed at and assume that that’s what the boat’s worth. But we have access to sold boat data so we can go back and tell you this is what this boat was listed for, this is where it was listed for three months, and then it sold at this price. We have a lot more data than normal by owner sellers would.
So that’s the other big thing. It’s very frustrating. This is not something that you should say as a broker, but boats are a terrible investment. Here, I always tell people they’re an investment in your happiness, your quality of life. They’re investments that way.
Marcy
They depreciate!
Everybody hears the story of somebody who’s bought a boat to go cruising for four years and come back and sold it for more than they bought it for. I think there’s a lot of expectation that that’s going to happen, especially with catamarans being so popular. So what are some tips you have for people to get the most out of their their boat, their catamaran, when they sell it? What kinds of things can you do beyond keeping it really clean, and catching up on cosmetics? Is there things like moving it to a really good port, or what would you? What kinds of suggestions?
Melanie
It’s like Marcy said, easy access. I mentioned in St, Augustine, where a lot of catamarans get stored in the St. Augustine Marine Center here, because it’s a hurricane-safe place, and all that. Having your boat in an area where there are other similar boats for sale. I always tell people too, somebody will, if you want a specific boat, you’re gonna travel to it. Unless you’re someplace really difficult to get to, location doesn’t matter that much. But bring it to the US, if it’s a U.S flag boat. Have it in a place that’s easy for people to look at it.
The other part of it too, we mentioned cosmetics, making sure everything works, and we have a whole checklist that if anybody’s interested, we’re glad to share. We have a seller’s guide, but it’s got a pre-survey checklist, a checklist of things to do when you’re listing the boat, just things that you wouldn’t normally think of. The day before your survey, you want to go through and turn on everything, make sure one little thing not working could mess up the deal, or mess up the financial part of it.
Marcy
The survey is not the first time that things should be tested. That’s for sure.
That’s a great tip!
Marcy
I think that might be even on our website, the information.
Melanie
It is. The buyers and sellers packets are both on the website.
The other thing too, and you mentioned the example of somebody who buys a boat, takes off to go cruising and sells it a year later for more. That doesn’t really happen very often, but there’s always the exception to the rules. Over the past couple years it has happened quite a bit, but it’s sort of going back into a normal market.
One of the mistakes that people make, and it’s heartbreaking because you go back to the investment part of it. Let’s say you spent $300,000 on your boat, and then in the first year, you spent $60,000 adding equipment, whatever . You’re probably not going to get that $60,000 back out of the boat. You’re probably not going to be able to get exactly everything you’ve put into the boat. Now, you can get more, or you can help you sell the boat more quickly. There are all kinds of ways that they can help, but we see people that get really disappointed because they’re like, “Well, I just put lithium batteries in, and I spent X amount of money.” Well, your buyer wants AGMs and doesn’t really care. Overvaluing the equipment on the boat is definitely a common mistake.
Does that makes sense when people are selling their home so often remodel a kitchen or bathroom before they sell. How much work should be people putting into a boat before they put it on the market? Should they be out there buying new sails, or that kind of thing?
Melanie
Any type of regular maintenance, they definitely need to make sure they’ve done that. Major money things, like sails you mentioned. If you go out and spend $20,000 on new sails, you’re probably not going to get an extra $20,000 for the boat. You will help it sell more quickly. So how much does your time worth and all that. That’s part of it.
Marcy
One key thing is to make sure you document all of the repairs, upgrades, and routine maintenance that’s been done. People want to see that, especially when we say our standing/rigging was replaced in 2020. They want to see documentation of proof of that on the phone. Because we can say it, we’re getting the information from the seller, and the buyer would like to see documentation of some sort. Spending the time to update equipment, and maintenance logs, things like that, and [making] sure routine servicing on the engines, the mechanicals has done is a must.
Melanie
Real quick, it’s actually pretty important. With routine and servicing on the engines, do not change your oil when you put a boat up for sale. That’s completely against your instinct, we all want fresh oil. The reason for that is, during the survey of oil sample might be part of the process, and it’s kind of like blood work for a boat. They run the engine, take take your oil, send it to a lab, let you know what kind of metal particulates are in it. If the oil is fresh, a lot of times people will think that that somebody’s trying to cover. That’s just a little counter-intuitive thing, but it makes sense.
That’s a cool tip! So somebody’s had their boat for sale by themselves for a while, at what point should they give up? Or what are some reasons that they might stop trying to sell it themselves and go to a broker?
Melanie
I think the biggest reason is time. People don’t necessarily realize how much time it takes to respond to every inquiry, and make all the phone calls, do the showings, that kind of thing. If you don’t have anything else to do, and if you want, I mean that’s not a good reason. If you are able to spend the time then do it, but a lot of people aren’t able to. A lot of people need to return to their jobs.
Marcy
Or don’t realize how much time is involved with the process. It’s how long it’s up for sale. I mean, it could take six months to a year to sell a boat, if it’s priced accordingly. If you want to sell it sooner, you adjust the price, that kind of philosophy. So you’ve got to wait, optimizing the best return on your investment versus your time, and how long you want to be showing a boat.
Melanie
The other thing too, I think realize [about] brokers, because we’re paying for them, we have more tools then your average seller does we have you know. We have the advertising budget, it’s not huge, but we’re able to get the boat out there. I love CatamaranSite, I always look and see what’s going on. We’ve worked with a lot of people who will spend several months trying to sell the boat on their own, and then realize that they just need more robust exposure. They want somebody else to do the legwork for them.
Fair enough. How can catamaran owners or buyers contact you, to find out about your services?
Melanie
Our website is sunshinecruisingyachts.com. It is easy to find all of our contact information on there. I’m Melanie@suncruising.com, [she’s] Marcy@suncruising.com. I don’t know where we can post the link, or anything like that.
It’s usually included.
Melanie
And we’re on social media, and actually that’s another thing that a lot of folks don’t realize, for sale by owner. I’ve probably gotten a third of my sales through social media in eight years of being a broker. The days of just advertising in one place, or advertising the newspaper, or whatever, are gone.
Marcy
We try to stay current, even with the new sailors. We dabble in TikTok, Instagram. We have fun stuff too, we have fun making fun of ourselves during the process. We’re just trying to stay relevant.
Melanie
My 12-year-old had to teach me how to use TikTok!
