My marina neighbor watched as I taped the "For Sale" sign on the bow of my boat. "What a coincidence," he called across, "because I'm getting rid of this boat, too."
"But," he added, "I'm trading it in on a new boat. I don't want to go through the headache of selling it myself."
I shook my head back at him. "I'm willing to put up with some extra work because I want to get the full value out of this boat."
As it turned out, we both got exactly what we wanted.
There comes a time in the life of every boater when you're ready to move on to another boat. It's probably larger, and it might be faster, shinier, or just newer. Your old boat has been a good companion but you've got "boat fever," and all those boats at the boatshows are turning your head. But before a new boat arrives in your driveway or marina slip, you have to sell the old one.
Sell it Yourself, or Trade?
Your decision of how best to part with your boat usually comes down to one of two choices: sell it yourself or use it as a trade-in. If you don't want a new boat, then you can probably eliminate the trade-in, since most dealers don't take trades on used boats unless you have a very special boat. And yacht brokers are generally not interested in representing smaller trailerable boats that don't generate much income.
So you're back to square one. Sell or trade. The choice is yours, so let's look at the pros and cons of both methods.
In short, the trade-in is both the easiest and least financially rewarding method of buying a new boat. It's easy, because you don't have to do anything at all: you simply pass the keys and the registration to the dealer, who handles everything including, in many cases, even picking up your boat.
The downside of a trade-in, of course, is that such a level of convenience doesn't come cheap. Dealers work on the "Buy low, sell high" concept to stay in business. If you're lucky, your dealer will give you the "high book value" based on one of the so-called "blue books" used to price used boats. But that is a wholesale price, so you're giving up a sizable amount of value in return for a no-effort transaction. The dealer, on the other hand, needs that low-ball value to cover the cost of reselling your boat, which includes advertising the boat, the display space overhead, paying a commission to the salesman, and handling the legal paperwork.
In addition, a trade-in imposes an additional demand on the dealer above and beyond the sale of a new boat. He doesn't get all of his money until he unloads your boat, so he probably won't give you as good a deal as you might negotiate without a trade-in. So your actual cost for a trade-in is the sum of the discounted value of your present boat and the less-than-ideal price of your new boat.
One final benefit to keep in mind about a trade-in is that, in some states, you only pay sales tax on the price of the new boat less the amount of the trade-in, so check with your local state registration agency.
Selling It Yourself
After taping up my "For Sale" sign, I also placed a classified ad in a newspaper that covered many of the local boating areas. Then I sat back and waited for the phone to ring.
A week later, I had received several phone calls from the ad about the boat, but I was a little discouraged because none of them were good prospects. One caller, who obviously knew nothing about boats, wanted a "sea trial" and it was apparent that he was looking for a free boat ride. Another, after a few cursory questions about the condition and the equipment, made a low-ball offer which I declined, suggesting that if he was serious, he should take a look at the boat. A third seemed only to want to tell me stories about a similar boat that he'd once owned. And I got several calls from sales people representing some of the national computer boat-for-sale listing services.
At the two week point, I had a call from someone who had seen the sign on the boat and wanted a look inside. He met me at the boat, spent an hour poking through the boat and then made a reasonable offer based on having the engines checked by a mechanic. I took his offer, we set up a time for a sea trial and the engine check, and I went home elated after taking the "For Sale" sign down.
The day before the deal would have been completed, my buyer called to tell me that he'd found another boat and had bought it, but thanks anyway. I was furious, both at my buyer and at myself for not having gotten a deposit. Tip: always get a deposit!
Several more weeks of ads finally netted a pleasant family who appreciated my boat and, after a couple of offer-counteroffers, agreed to a price that made me happy. They didn't have a trailer hitch of the right size, so I agreed to deliver the boat to their home about 50 miles away, and I also went with them to the motor vehicle department to sign off on the registration.
The bottom line is that I ended up with about 10 percent less than what the blue book advised was the average value for my boat. That didn't include the advertising or the cost of the delivery, and it didn't take into account the hours I'd invested in selling it myself.
On the plus side, I was able to negotiate a great deal on my new boat since I had cash in hand and the dealer didn't have to worry about a trade-in.
At the same time, my neighbor paid more than I did for a similar boat, but it was an effortless transaction. One weekend, his old boat was in his slip — the next weekend a new one was there. No grief, no problems.
So which way would I do it next time? I don't have any idea.
Whichever way you choose, there are some tips that can make unloading your present boat easier, faster and more profitable. Let's take a look at some of them.
First, pick the right season to sell. Boat prices are highest at the beginning of the boating season, and lowest at the end of the season. There are more buyers for boats then, so you can get a better trade-in value from a dealer who isn't facing a used boat that he'll have to store all winter. And, of course, with more buyers you'll have better luck selling it yourself, too.
Second, research the value of your boat beforehand. (For more details, read Boat Prices with NADA Guides.) Too many sellers don't determine a fair market value, so they either sell too low or expect too much.
Third, prepare your boat whether you're trading it in or selling it yourself. Get your boat so it looks it's very best, and will be in the top range of values. I've always found it amusing that the only time everything works perfectly on my boats is when I put them up for sale. Fix that broken windshield wiper, replace the snap on the Bimini top that has been flapping for ages, and finally get around to cleaning out that filthy anchor locker.
For more tips, watch our video:
How to Sell Your Boat for the Highest Price
Cosmetics are the number one selling point for any boat, and the first 30 seconds are the most critical when a potential buyer (or dealer) looks over your boat.
How much work you want to do depends both on the amount of money you're willing to invest to get back more money, and the time you have to commit. A basic project is to buff and wax the fiberglass hull to a shine, and touch up any paint or varnish.
Get the mildew off the cushions and covers, and empty out the drawers. A clean engine compartment is always reassuring to buyers so, if your boat is trailerable, you might take it to a commercial truck stop for a steam cleaning. Make sure the engine starts easily, that the batteries are fully charged, and that the electronics are all working. And make sure that the head is clean and sweet-smelling!
There's an art to "propping" your boat, and I don't mean choosing a propeller. You need to make your boat look attractive and inviting, and it doesn't take much to achieve that effect. Think about model homes you've toured, where comfy pillows made the bedroom seem inviting and a table setting in the dining table was ready for a friendly party.
A discount housewares store can give you some cheerful dishes and place settings, you can raid the home library for books that look good on cabin shelves, and a wine bottle will have a lot more atmosphere than the six pack you usually keep in the refrigerator.
A dealer will usually see through your superficial decor, but a clean boat that looks cared for is always going to get a better trade-in price than a messy or dirty boat.
If you're selling the boat yourself, put together an information kit for your prospects. You'll want a couple of clear photos of the boat in the water, preferably showing people having a good time. A brief history of the boat (as much as you know, anyway), copies of old sales brochures, and a neatly typed list of the equipment included can help your sales pitch immensely.
Whether you take the easy but higher cost way with a trade-in or the tougher but more rewarding sell-it-yourself method is a choice you'll make based on your boat, your location, your time, and your financial situation. Saying goodbye to an old friend is always tough, but that's offset by getting top dollar that you can put toward that new dream boat.
Editor's Note: This story was updated and republished in January 2015.