The pandemic caused a rush on a lot of things: toilet paper, cleaning supplies, n95 masks. And when the masses came for the boats, the brokerage market took off. “People realized that boating and yachting was one of the really great things that you could get out and do and be safe with your family and friends away from crowds and all the restrictions,” says broker Michael C. Galati with Galati Yacht Sales. “It took a few months, but by the third quarter of 2020, sales had picked up quite a bit. By the end of the year, all of the inventory that was desirable was sold. Brokerage and new boats—anything late model or new that was priced competitively—all of those boats were sold. Then the calendar turned into 2021, and we started to experience a shortage.”
That continuing shortage is the reason why, as you walk the boat-show docks this fall, they look a bit like the picked-over supermarket shelves from early 2020. Fewer brokerage boats are for sale than usual across all market segments, from center-consoles to sport-fishermen to superyachts.
HMY Yachts, one of the largest brokerage companies in the United States, usually brings 35 brokerage boats to the Fort Lauderdale International Boat Show in Florida. This year, less than two months before the show, the company was hoping to have 25. Worth Avenue Yachts, which specializes in yachts 80 feet and larger, booked 12 slips for the show. It had four boats to put in those slips as of September and expected two of them to sell before the gates opened.
Tim Derrico, director of sales at HMY, says the current state of the brokerage market is forcing would-be buyers to shop in ways that can feel just as shocking as what all of America experienced during the pandemic’s early supply-chain disruptions: “You better be quick on the draw. If you hesitate, somebody else will step in and buy it. If you wait a day or two, forget it.”
The New Normal
Get used to the current market conditions, experts say, because things may not equalize anytime soon.
The shortage is a result of numerous factors, starting with the type of people who led the recent boat-buying craze. Yes, there were longtime boaters in the mix, but a lot of the buyers were new to boating, including an unusual number of people so stunned by skyrocketing prices for homes on land that they turned their attention from the waterfront to waterborne.
“We normally would’ve seen people buy condos or houses, but all they can get right now is a shanty on the water,” says Jimmy Rogers, a broker with OneWater Yacht Group. “In the boat market, if they can find it, they can get a nice 60-foot boat. I think the craziness in the real estate market is driving the craziness in the boat market.”
At the same time, longtime boaters who normally would have put their rides on the market to trade up decided instead to hold pat.
“You have people who went to their boats because it’s safe,” says Westport Yachts sales broker Alex Rogers. “They could control what happened there to the point that they had their crew sit on the boat and not leave, and had things brought to the boat. In the Bahamas, they’d have seaplanes fly in with food—just crazy stuff. And that has continued.”
And longtime boaters couldn’t trade their boats for newer models because of jams in the new-boat supply chain as well. Brokers and dealers say sales closing now on new boats are for 2023 or 2024 deliveries. Some superyachts are being ordered for delivery in 2026.
The backup is so intense, Galati says, that brokerage buyers are now looking to sign deals for existing boats, with a handover whenever the owners become ready to sell them.
“We call them ‘future availables,’” he says. “Say the owner has signed a contract to buy a new boat and trade it in. Well, he’s not going to give up that boat until his new boat is ready, but we can sign the contract now for the sale later.”
The result of all these pressures is that when boats do come up for sale, they’re finding buyers incredibly quickly, often even faster than the brokers can make the listings available. Brokers advising clients to move ultra-fast these days really mean it.
“Right now, our best advice seems like a sales pitch, but it isn’t,” says Chuck Cashman, chief revenue officer at MarineMax. “When we say that boat is going to sell overnight, it’s actually happening.”
Prices are only slightly up—buyers haven’t lost their fiscal minds—but the new currency of value is the knowledge that a boat is about to go on the market, so you can make an offer before anyone else even knows it’s available.
“I just listed a 1990 36-foot Sabreline Fast Trawler in the Florida Keys, and in two days, I had three offers,” says Curtis Stokes, president of Curtis Stokes & Associates. “We put it under contract for full asking price, and the seller cut off the bidding. Normally, that would have taken six months.”
Do you think that sounds fast?
“We just sold a Garlington sport-fish the other day. I think we sold it in 20 minutes,” says Jon Burkard, president of Allied Marine. “That’s an exaggeration, but definitely within a couple days. The rise in demand has actually been breathtaking.”
In years past, it would take six to eight months to sell a motoryacht big enough to require a crew, says Brian Tansey, co-founder of Worth Avenue Yachts. “We had a brand-new boat that was a 100-footer,” he says, “and in 60 days, it was gone.”
How To Get In
Trying to buy a boat in this type of market can be challenging. And part of the problem is not the actual marketplace but the way so many of us now think about how to shop.
Back in the olden days—before social media and online boat listings—the way you found a great brokerage boat was by working with a knowledgeable broker. You’d look through classified ads in a magazine like this one, call a broker and ask about a listing that tickled your toes, and pick his brain about what other boats he knew about that might suit your needs. That broker, in turn, was using every one of his personal relationships to learn not only about boats for sale now but also about boats that might be coming up for sale soon. Having a broker who was “in the know” was an indispensable asset.
Then came the World Wide Web. Nowadays, buyers are using the internet to learn about boats coming onto the market for sale and then clicking to buy them.
“The broker’s participation in a boat deal went down to nil,” Alex Rogers says. “All they did was the paperwork, to the point that Yachtworld now has a make-an-offer button where you don’t even need a broker.”
That type of shopping strategy—which permeates modern society for all kinds of products—is the last thing a buyer should be embracing in the brokerage market right now. Instead, experts say, what’s often required in order to learn about—and make a successful offer on—a brokerage boat these days is having a relationship with a connected broker who can get you into the mix on a deal before the boat even hits other people’s computer screens.
“There’s no question about it. If you want a brokerage boat, you need to associate yourself with a salesperson from a large firm that handles multiple brands and has lots of inventory,” Derrico says. “Unless you’re dealing with somebody that’s in the know, that sells a lot of those boats, you’re never going to hear about it. A small-time broker that works out of his car? Forget about it.”
Not every yacht broker has those kinds of deep relationships, Alex Rogers adds, meaning that buyers would be wise to interview potential brokers about not just their current sales listings but also their connections. A broker should be able to explain, in this market, how he intends to help you find a boat that will suit your needs.
“The new brokers who just came into the business can’t do that,” he says. “All they have is the internet.”
Cashman also suggests that clients ask brokers to explain their sales from the past six months. “We’re at a historic level of business. Show me your results,” he says. “Make sure you’re dealing with somebody that has a track record of getting things finished.”
Be Ready To Pounce
Another thing buyers can do to increase their chances of success is having all their paperwork in order. If you’re going to need a loan to pay for the boat, then get preapproval from the bank. Most brokers won’t even bother making an offer right now that’s contingent on securing financing.
Insurance also needs to be considered well before you know which boat you want to buy.
“Insurance has changed our business in the past two years almost as much as COVID,” says broker Jeff Stanley at Gilman Yachts. “There’s so much business that the insurance underwriters have tightened who they want to insure. They’ve raised the bar.”
A buyer who has never owned a boat, or only owned smaller boats, and who doesn’t want to pay $75,000 a year for a captain on a 60-footer he’s looking to buy? Slim to no chance of getting insured. An experienced boater who thinks the insurance company will follow the normal pattern of waiting for a survey to determine a boat’s value? Think again.
“I just did a deal on a 2006 65 Marquis,” Stanley says, “and the insurance underwriter was telling the buyer what the boat was worth before there had even been a survey or an offer.”
Jorge Pecci, the CEO of SafeWaters Underwriting Managers, says insurers absolutely look at more than the boat itself. To determine risk, they consider the boat, who will be driving it and where it will cruise.
“This includes years of experience in general and on similar boats in the intended navigation waters, as well as what kind of training the operator had,” Pecci says. “US Coast Guard licenses are preferred.”
As with finding a top-notch sales broker, finding a top-notch insurance broker can also help.
“Avoid using generalists,” Pecci says. “When dealing with a brokered boat, you want a specialist, someone that understands boats. He or she will ask the appropriate questions to obtain a competitive outcome when looking for insurance on your behalf.”
Many buyers—given that the market has been in this state for the better part of a year—have learned that insisting on a specific model, features and build year is probably not the best approach. Flexible thinking, brokers say, is a better tactic.
“People are calling us that don’t necessarily want what everybody else wants, and maybe they’re willing to be less particular than they would’ve been, so we can find something that suits their needs,” Burkard says. “Enough of the clients know that stuff just isn’t out there, so they’re thinking of other ways to go boating. They change their plan. Maybe they wanted a sport-fisherman and they move to a big center-console for a while. Or maybe they adjust and get a motoryacht.”
Others are shopping in creative ways. Galati and Tansey say they’re selling boats after virtual tours on FaceTime or Zoom. To beat the crowds of buyers, the broker goes to the boat, loops in his client on a video call, and has a surveyor on standby. “We’ve had clients buy boats without actually touching the boat,” Tansey says. “We did that with a 56-meter [184-footer]. They did not see the boat until it landed in the United States.”
Stokes is encouraging clients to go to boat shows, but also to leave time to visit boats beyond the show docks.
“My advice to people going to boat shows is: Go. Enjoy the atmosphere, and look at all the parts and supplies, but hire a buyer broker to represent you well in advance, to scout out what boats are for sale in the general area of the boat show. You can look at boats that are for sale by owner or listed but not in the show, and then go the show for a day.”
Cashman also is urging clients not to wait until the shows to make an offer.
“I believe the premium, properly priced boats are going to be under pressure before the show,” he says. “That doesn’t mean there won’t be a good deal at the show…but if I was in the market to buy a boat, I would try to do it before the show. Get it off the market.”
Most of all, yacht brokers say, be patient. Nobody knows what will happen next. People who were new to boating in 2020 may sell in 2022, having had a taste of operating costs or deciding they want a different ride. People who fear an economic downturn may sell boats to get cash on hand. All of that could bring more boats into the market.
The one thing everyone agrees on is that, eventually, the market will change.
“This is not going to keep going forever,” Derrico says. “I’ve never seen an upcycle last this long. At some point in time, it’s going to stabilize.”
Broker Jimmy Rogers at OneWater Yacht Group says sellers are reluctant even to list boats until they find something new. “It’s just more buyers than there are sellers and not a lot of inventory out there. It’s a more challenging environment, and it may be getting more challenging.”
A Long Line
Sales broker Michael C. Galati of Galati Yacht Sales says his firm developed a yacht-shopping tool on its website to help would-be buyers receive the most up-to-date, publicly available information the moment it comes online. So far, according to the company, more than 3,000 would-be boat buyers have signed up. “It’s like Zillow,” he says. “You put in your parameters, and when that hits the market or there’s a price drop, you get notified with an email. Anyone can sign up.”
Tim Derrico at HMY Yachts says there is such pent-up demand right now for certain boat brands that listings sometimes don’t even make it online. “Being the biggest Viking dealer and the biggest Princess dealer,” he says, “if we come up with a late-model Princess or Viking, we can usually sell it with a couple of phone calls.”
This Is Different
Broker Curtis Stokes says previous buying sprees don’t compare to what’s happening now: “In 2007, just before the recession, it was a phenomenal year for sales but…there was more inventory; people could get into a boatyard and fix it. Now, I sense a lot of frustration among new buyers. They want to get on a boat and go, or update it, and they’re struggling to find the inventory. When they do find it, getting upgrades done and getting supplies or repairs is also hard. For someone brand-new to boating, it’s been a little frustrating.”
The brokerage inventory crunch extends beyond the United States, says Alex Rogers of Westport Yachts: “A lot of the brokers I’ve spoken to over the summer have customers in tow. They put together a list of boats stateside and [in] the Med, they book the ticket to fly to the Med, and before they get on the plane, half the boats have sold. It’s in a matter of days.”
Often in a sellers’ market, brokerage boats will be listed at sky-high prices that bear no resemblance to actual value. That’s not happening now, brokers say, so don’t overpay—no matter how many times you hear that the market is red-hot. “After sellers have heard this enough times, they think their boat is worth a lot more,” says Jeff Stanley at Gilman Yachts. “I don’t think it is. I just think it sells more quickly than it would have a few years ago.”