Surveys done, now what?

[Bear Paws]

A quick intro then I will cut to the point. I’ve got an accepted offer and did the boat and engine surveys/sea trial on a 10 year old 480 DA. I have a repair estimate on the engines for about 5k and probably will take another 5k to make her stand tall. This is my first boat and have a top notch broker but always like to analyze deeper. I feel like we’ve negotiated to their bottom, how can I proceed without feeling like I left something on the table? As a seller, what would you expect at this point?

 

[fwebster]

I wouldnt worry about what the seller thinks.......

At this point, I think this boils down to the legal basics. You have a contract to buy the boat at a specific price subject to various contingencies which you obviously included in the terms of the contract.

On the $5,000 repairs that are needed......you have the right to reject the boat now and get your deposit returned less the sellers costs for haul out and other things he did to make the boat available for your survey. The seller loses a several hundred thousand $$ sale, must relist the boat and start the process over. You lose the cost of your surveys and a small portion og your deposit. This means that you have leverege here.

On the other $5K "stand tall" cost, unfortunately, you should have identified these needs on your initial inspection so you don't have a lot of leverage here.

You are at the point where you need to talk to the broker and tell him: " Your guy's boat failed the survey for these reasons (1, 2, 3, 4,.....don't give details or let the broker try to initiate negotiating each point). Additionally, we found another $5K incidental repairs the boat needs to bring it back to a safe and seaworthy condition. Therefore, I am prepared to cancel the sale unless you can get your seller to amend the selling price." Then shut up and wait for a response, whihc is likely to be "Oh, he would never reduce the price that much." Stop the broker heading down that rabbit hole and respond with "Well, it isn't my fault your guy has neglected proper maintenance and care for a $xxx,000 boat anad I am not paying the price for that neglect. Why don't you see if we can reach an accomodation with the seller that we all find accpetable?"

Keep in mind that we frequently run into negotiating roadblocks if the seller has a lot of debt on the boat. Perhaps he is highly leveraged and cannot make up the shortfall if he cuts the price further....but I'd make him blink to find out.

Good luck with it........

 

[sbw1]

Repairs of about $5,000 on the engines? I'd be surprised if that number turned out to be the actual number. If it were me, I would want the engine issues fixed. Might cost $5,000, or 4,813.49 or 15-20 thousand. I don't do deals when the costs are described as "about x dollars." I would try to get repairs nailed down and tested before close.

 

[Gofirstclass]

I agree with sbw1. I'd want the engine repairs done and I'd like to be able to choose the shop that does the repairs.

As to the other "cleanup" costs I'd try to negotiate the price down to cover as much of that as I could, then I'd probably do as much of that myself as I could. Waxing, washing, cleanup, etc. are things I can do and I consider those items a labor of love.

 

[JVM225]

I’ll also agree with SBW and recommend you insist that the $5000.00 repairs be made by the seller.
Repairs usually wind up costing significantly more than a first estimate, and $5000.00 worth of repairs doesn’t really go a long way.
As far as the “Stand Tall” items, you should only deduct what you didn’t know about before you made your offer.
Again though, if they involve unexpected repairs then I would insist they be done by the seller too.
If the seller agrees to have the necessary repairs made and bring the boat up to what you thought it was before the survey then you should pay him the price you agreed to pay when you signed the contract.
If not, I would seriously consider walking away.
If you buy it, the problems now become yours.

 

[fwebster]

We can only respond to information in the OP's post. He didn't post the repair shop's estimate. He only described it as an estimate of about $5K. So, when was the last time you asked a repair shop for an estimate and got a precise, to the penny number........Never, unless you live in a perfect world. What you got was an estimate with fine print at the bottom about undesclosed conditions that may effect the final repair cost.

It is also a mistake to expect a seller to handle repairs as a contingency of the sale. He will get it done as cheap as he can with no reguard for quality opther then to last until closing and delivery. I prefer my issues be handled under my supervision and done according normal proper marine repair practices.......not just "fix this as cheap as you can so I can deliver the boat Friday. "

 

[Little Ducky]

Enjoy the dance.

You hold all the cards in these negotiations.

What kind of engine repairs are needed for 5K?

Simple parts replacement I hope or is there some unknowns?

If possible get past invoices on what was done to the boat and you will get a better idea how the boat was taken care of. When I bought my 98 290 DA the marina turned over 7 years of invoices before I signed on the dotted line.

 

[JimT]

Interest and storage over the winter will exceed $10,000. You have leverage. Insist on the repairs per the survey. No matter how confident a seller may seem they are not.

 

[sbw1]

I feel like we’ve negotiated to their bottom, how can I proceed without feeling like I left something on the table?

Any expenses above the estimated repair bill of $5,000 after you own the boat is money you leave on the table. Nail that number down and have it fixed prior to closing, or escrow a safe amount of money with a cushion to cover the repairs if you close prior to the work being completed in a workmanlike manner. I would put these repairs in a different category than the "standing tall" issues. However, if standing tall includes some gel coat repairs for example, or canvas that is well worn, you may want to add those to the repair expenses. Gel coat repairs, while simple to complete by competent techs are surprisingly expensive. It's easy to spend $1,500 on minor repairs. Same thing with canvas, and your 480 has a lot of that to maintain.

 

[fwebster]

............
It's easy to spend $1,500 on minor repairs. Same thing with canvas, and your 480 has a lot of that to maintain.

Really? Suggest you look at a photo of a 48DA.

 

[MonacoMike]

Not knowing the details of the engine repairs needed it is difficult to know for sure if they should be repaired and surveyed before the sale completion or just take the credit.

It usually comes down to the risk tolerance of the buyer and how big a control freak the buyer is. I would be like Frank, I want the money and will take the risk to be in control. Not everyone can do that.

MM

 

[Bear Paws]

I wouldnt worry about what the seller thinks.......

At this point, I think this boils down to the legal basics. You have a contract to buy the boat at a specific price subject to various contingencies which you obviously included in the terms of the contract.
Keep in mind that we frequently run into negotiating roadblocks if the seller has a lot of debt on the boat. Perhaps he is highly leveraged and cannot make up the shortfall if he cuts the price further....but I'd make him blink to find out.

Good luck with it........

 

[Bear Paws]

All, thanks for the input. I do have a very detailed list of which of these items are “necessary” and which are expected in a 10 year old boat. The 10k all in covers fixing/replacing the items to make her function properly/safely as well as some routine maintenance. I do have access to the service records and will be looking to see if these were known and neglected. Fwebster, I think you said it best. I do have the leverage and wrote it so as to not have to pay a dime after the surveys, so the seller will be on the hook to rewinterize should I decline. I just got all this info back over the weekend and the next few days will tell a lot. I will post the outcome. Thanks again.

 

[sbw1]

Really? Suggest you look at a photo of a 48DA.

An aft curtain for that boat is not cheap. Could easily cost five thousand depending on how it's done.

 

[fwebster]

Perhaps in the frozen north or NYC, but in the real world, replacing that piece of canvas will take about 20 yards of Sunbrella, add zippers and Strataglass and you have roughly $900 worth of materials. Canvas shops double the cost of materials for labor, so this is an $1,800- $2000 curtain.

 

[sbw1]

Perhaps in the frozen north or NYC, but in the real world, replacing that piece of canvas will take about 20 yards of Sunbrella, add zippers and Strataglass and you have roughly $900 worth of materials. Canvas shops double the cost of materials for labor, so this is an $1,800- $2000 curtain.

Real world prices in Michigan are much higher. An aft curtain for my boat was $1,900 in 2004.

 

[The Bill Collector]

When we bought our boat it was 9 years old and advertised in "Bristol" condition. With that, we expected turnkey operation. There were a couple very minor issues discovered in the boat survey (light bulb, latch, etc) but in the mechanical survey the heat exchanger on the gen. failed, some of the main cooling hoses were cracked, alternator bad, anyway it came down to $3500 + another $2500 that I wanted done to have A baseline for routine maintenance items. My deal was you offered the boat @ Bristol and it has these deficiencies so you'll need to pay for the repairs and we complete the sale or I take my deposit and walk away. The seller agreed to pay for $3500 in repairs and we bought the boat...

 

[sbw1]

When we bought our boat it was 9 years old and advertised in "Bristol" condition. With that, we expected turnkey operation. There were a couple very minor issues discovered in the boat survey (light bulb, latch, etc) but in the mechanical survey the heat exchanger on the gen. failed, some of the main cooling hoses were cracked, alternator bad, anyway it came down to $3500 + another $2500 that I wanted done to have A baseline for routine maintenance items. My deal was you offered the boat @ Bristol and it has these deficiencies so you'll need to pay for the repairs and we complete the sale or I take my deposit and walk away. The seller agreed to pay for $3500 in repairs and we bought the boat...

The way I look at it is your buyer survey is going to disclose most issues with the boat and you will end up paying for the repairs, deferred maintenance or whatever. You might as well stay on top of things and enjoy a well maintained boat that looks sharp. And, it will be worth more and easier to sell when that time comes.

 

[MonacoMike]

When we bought our boat it was 9 years old and advertised in "Bristol" condition. With that, we expected turnkey operation. There were a couple very minor issues discovered in the boat survey (light bulb, latch, etc) but in the mechanical survey the heat exchanger on the gen. failed, some of the main cooling hoses were cracked, alternator bad, anyway it came down to $3500 + another $2500 that I wanted done to have A baseline for routine maintenance items. My deal was you offered the boat @ Bristol and it has these deficiencies so you'll need to pay for the repairs and we complete the sale or I take my deposit and walk away. The seller agreed to pay for $3500 in repairs and we bought the boat...

That is great, BUT every deal is different, completely different buyers, sellers, brokers, liens, and subject boats. They need to negotiate an agreement that may be like yours or very different. That is why I recommend a buyer broker to help folks that do not do this often navigate the negotiations.

MM

 

[Brent Nutting]

That is great, BUT every deal is different, completely different buyers, sellers, brokers, liens, and subject boats. They need to negotiate an agreement that may be like yours or very different. That is why I recommend a buyer broker to help folks that do not do this often navigate the negotiations.

MM

I had a buyer's broker when I purchased our boat that was listed by a private seller. One of the best things I did! Well worth the money to have peace of mind to make sure everything was going the way it should.

On and regarding canvas up here in the north. I just got a new cockpit canvas for my 480DB. It included an extension of 3 feet. It also has the screens or windows depending on what the weather is like. That cost just over 5 boat bucks and included the extension bar.