How to Buy a Sailboat

How to Buy a Sailboat

The Fall and the Spring are the two busy seasons of boat buying.  In the fall, current owners wish to sell their boat not to pay storage or insurance over the winter. They want to begin looking for their next boat, or order a new one to be built for delivery next spring using the sale of the old boat as a deposit.  In the Spring, many buyers appear, looking for boats so they can go sailing for the summer.

There is so much to look for when buying a boat, advice is abound from everyone.  Most builders have great reviews on their quality, others are iffy.  Longevity of a boat also is something where most boats last for eons, and others are abandoned or crushed sent to a dump. A great boat from a great builder that has been rode hard and put away wet may have a great price, but the cost to make her shipshape, Bristol or yar once again can easily exceed the purchase price. You need a team of experienced people to get the right deal for yourself.

Engage a Broker

Many think they'll save money bypassing a broker.  There is no law requiring the use of one.  However, a broker can be a valuable asset.  Commonly they know lots about the type or exact style of boat you are looking for.  They'll know the types of problems these boats have had over time and can help steer you away from one that will cost you more to fix, than you paid for the boat in the first place.

They'll listen to your goals, understand your budget, whether you are a hands-on tinkerer, or pay others to maintain all systems.  They get the size range from you, boats you've seen and don't care for, and those you have seen that you like.

As a professional, they have come a long way and know their personal reputations are on the line when putting a deal together.  Many have joined the Yacht Brokers Association of America earning the CPYB designation (Certified Professional Yacht Broker).

Think of the commission they earn as the knowledge you don't have when searching for a boat to purchase.  It's worth the price.

Hire a Surveyor

A great boat can have hidden damage, either by original design or workmanship, or by an owner who either cut corners in a repair, or incompetent repair work performed by a repair yard.

How do you know what boat you are buying is as sound as the day it was built?  Or at least know what defects must be fixed before it is taken for a sail?

After you picked a boat, and a contract of purchase signed, commonly you will have a clause in there that the completion of the sale is based on a successful survey.  This specialized field is one where experience counts.  A surveyor commonly knows the weak points of a model you are considering buying, plus inspects the entire boat inside and out (out of the water survey is required, don't cut corners doing a survey in the water).  It is uncommon for a boat over 5 years old to come out with a "clean survey."

Survey's uncover all sorts of things from the simple - "the fire extinguishers are out of certification," to the expensive to repair where there is "delamination in the hull or deck" (it is common that boats are built like plywood, a layer of fiberglass on the outside, a layer of foam or balsa wood in the middle, and a layer of fiberglass on the inside of the sandwich).  If the glue holding these layers together have failed, or water has gotten it wet on the inside, a seaworthy repair can be done, it just is time consuming and expensive to do.

Surveyors inspect the rigging, mast, boom, poles, deck, lines, electrical, plumbing, structure, and all things within eyesight.  They do not get involved in testing the operation of electronics, engines or generators.  There are other professionals that can be hired who can test these thoroughly (ask your surveyor for a recommendation), so you can be assured this boat won't end up being a money pit for you.

The key section in a survey are the "Recommendations."  These are the items in the Surveyor's opinion that makes the boat "unseaworthy."  You will find that the word "Recommendation" changes to "Required" with your insurance company.

Reason being is a Federal Law called the "Warranty of Seaworthiness."  In a nutshell what it says is no insurance company has to pay a claim if the boat was unseaworthy when it left the dock for its adventure.  Case in point, a big sailboat with a built fire extinguishing system in its engine compartment left for a long distance sail.  The fire extinguishing system was out of order when they departed (and warrantied to be operable when applying for the insurance).  They were caught in a hurricane with extensive damage to the boat.  No fire mind you, mainly exterior damage.

A judge declared as the fire extinguishing system was not operable when it left for its adventure the vessel had broken its warranty of seaworthiness, and the insurance company had no responsibility to pay for any damage to this boat.

With an insurance company requiring you to fix everything that the surveyor "Recommends", you are guaranteeing the boat is seaworthy at the time the repairs are made and setting off on the right foot.

I read one disaster recently where the buyer accepted a year-old survey the owner had done.  Never do this.  Always hire your own surveyor.  As it turns out, it appears that the boat ran aground after the buyer's survey was done.  The damage was extensive, and then hidden.  The seller did not disclose this damage, and the buyer purchased the boat. The buyer was out in the middle of the ocean when things began to fall apart and they started taking on water.  Luckily they made it back to shore alive.  But now they have a repair over $100,000 that they could blame on no one other than themselves, and accepted this the reality.

Hiring a surveyor would have uncovered this damage, the buyer would have had the choice to either walk away from this purchase and get their deposit back, or, require that seaworthy repairs were done to this boat before consummating the deal.  The rear view mirror advice they gave was, "to always hire your own surveyor when buying a boat."

Where do you find a Surveyor?

One last reason to hire a surveyor is, most insurance companies will require it if the boat is 10 or 15 years, or more, old.

Insurance Agent / Insurance Company

There is no law requiring insurance (does this make you want to buy uninsured boaters coverage when some uninsured boat might hit you?).  If you have a loan on your boat, your bank will require insurance.  No two insurance companies make their policies are alike.  The quality and coverage differences are all over the map from one insurance company to the next.  Ask your shipyard owner what insurance companies not to use.  They'll tell the horror stories of the boat that sank, needed a crane on a barge to go out and retrieve the boat.  The cost of that recovery (salvage) is deducted from the value of the boat on the policy.  Then when it comes time to pay for the repairs to make the boat right again, there's not enough money leftover in the boat limit to make the repairs.  Or worse, to pay off the boat loan.  You're stuck making bank payments on a boat that won't ever sail again.  Other insurers deduct the cost of salvage (crane and barge) from the "liability part" of the policy, so that 100% of our insured hull value is there to repair your boat once it is ashore.  This is just one small difference.

As one shipyard owner told me, "Look for a marine insurance company.  Not a mass merchandiser of personal home and auto insurance to insure your boat."

Many of these policies are on the "Agree Value basis" which means 5 years from now, that whatever you paid for that boat will still be what you are paid by the insurance company when the boat is destroyed.  No depreciation or market value changes are involved.  These insurers wish to protect your investment.  Never skimp on liability either, it is the least expensive portion of your coverage and purchase $1,000,000 at a minimum if you can afford it.  Then order your umbrella agent to add your boat to your umbrella.

Shipyard

Almost all boats in the North get pulled out of the water for the winter and put on Stands or Cradles. Putting your boat in a shipyard is just part of the process of ownership.

Are you the type that hires everyone else to do everything for you?  Have no idea how to spin a wrench, fix a loose wire, or change the oil in the engine?  Be sure to store your boat at a full service shipyard and make sure they will come to your harbor in summer to make repairs.

There are other yards who will haul the boat in the fall, and launch the boat in the spring, with no services available otherwise.  Sailors who do all of their own maintenance commonly store in a shipyard like this.

Be sure to match your skills to those of the shipyard you choose.

Small Boats

At a certain value, size and simplicity in boats, most do not wish to pay for the Broker or Surveyor.  The systems on these boats are less complicated (probably no engine, no electrical system, no plumbing).  Don't get me wrong, these boats can have problems that a surveyor would find.  Commonly someone newer to sailing will take a knowledgeable sailing friend to inspect a used small boat.  Commonly they will have heard where the weak points in a design or construction is, and know to look that it appears to be in good shape.

Fixer Uppers

These are abound everywhere.  You can get them cheap, and pour lots of blood, sweat and tears into these boats.  This is not a good idea for someone new to sailing.  You should have done repairs on other boats, learning the tricks of the trade.  Here's one example - always use stranded wire for electrical installations.  But that is not the full answer, you must buy "tinned" stranded wire.  The copper wire has tin plating on the surface of the wire, inside the plastic coating.  The marine environment is corrosive to copper, especially salt-water sea air.  Copper is corroded quickly without the tinning.  This wire costs more than regular wire, but it won't short out, won't overheat and cause fire, an will keep your electrical and electronic instruments running.

That's just one little tidbit of the knowledge you should have before starting on a fixer upper.  If you wish to see the 9 part series on "Rehabbing a Used Boat" take a look at the right rail on this webpage and click on a six-week intensive program of a fixer upper our family did in 2014.

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