Buying SV Tusitala
I've read that it takes people years to find and purchase the right boat. I think that could be true. We began the search online, scouring over listings on Yacht World. I contacted brokers on 10 or more boats just to see how to get a feel for the process. I quickly got the feeling that brokers saw me like a tire kicker, which I was.
In the beginning, I was looking at monohulls that would sleep our family of 7, mostly Benetueas, because, at 50', they are built with enough beds for us all. And while I actually only sailed small catamarans, the picture of a large monohull filled my imagination of what ocean sailing was all about.
After my week-long ASA class on a Beneteau 45, I began to consider that a catamaran may be a better fit for my family. More research confirmed my thoughts that a catamaran is just a better fit for the 7 of us. My research leads me to the Leopard 46 and Leopard 43. Shaft drive, skeg mounted keel with lots of space, and a solid reputation.
The first boat we made an offer on was a leopard 46, located in Florida. Our offer was rejected, which turned out to be a good thing. Part of our thinking here was that we wanted to see how the process worked, and knowing that our offer was low, I expected our proposal to be rejected.
I first inquired about Tusitala on July 14, 2019, and we closed on the boat the last week of January 2020. The entire process took 6 months. Much longer then I expected that it would take. I'll try to break down the process and details just for fun.
Steps for buying a sailboat:
This may be the most essential step in finding a boat. Sailboats are complicated machines that come in lots of different shapes and sizes, kinds, and colors. I have been sailing for a long time and really only know about one type of sailboats, Hobie Cats. So I had a lot to learn about blue water cursers. My research was all done online. My process was basically to find an exciting boat, read the detailed description, and why I came across a brand or device or system that I hadn't heard of I would google it, read about it, which youtube videos about it, rinse and repeat. Being a major nerd, I find it really easy to blow hours and hours doing this for just about the most ridiculous things. I got to the point where I could name most brands of catamarans and monohulls I saw at a glance and give a brief rundown of their best and worst features, according to the internet.
2. Finding a Boat
Yachtworld.com is the defacto website for searching for new and used sailboats. The majority of boats listed on Yacht World are listed by boat brokers. Having never purchased a large sailboat before I can't say much about using a boat broker, but for me, it didn't seem like paying an extra 10% was worth it. With that in mind, we began to search for boats for sale by owner. My wife found a great site catamaransite.com that lists used catamarans for sale by owner. At first glance, the site appears a bit dated, but the boat inventory is good, and boats listed there are well described and photographed. Because we live in Utah, we begin to limit our search to the west coast.
3. Making the offer
Making a and getting an offer accepted was more complicated then I hoped it would be. We made our initial offer via email. The email offer is pretty simple, you just need to get the seller to agree to take you on a sea trial and let you haul out the boat. You need to specify the amount, your contingencies, and an expiration. Deposits on a boat are often 10 to 20% the purchase price of the boat, but it is always contingent upon your satisfaction with inspection, sea trials, and survey. You don't give the seller the deposit, you give it to a third party. In our case, once our email offer was accepted, we wrote up a more official officer with help from an attorney friend of mine, who also served as a third party to hold the deposit. We specified our deposit to be $5K, which ended up not mattering much. We signed the offer with the sellers before we proceeded with the haul out and sea trials. The seller initially asked for 330K for the boat but reduced the price to 300K, we agreed on 280. One thing to keep in mind, you can put anything you like in your offer. The basic offer includes purchase price, deposit expiration date, and warrants that if for any reason you do not like the inspection you do not lose your deposit.
The diligence process is primarily made up of inspecting the boat, sea trials, and a haul-out survey. We made two trips to visit the boat. We visited the boat once before we made our offer and once to complete inspections and surveys. During this phase, you want to spend as much time as possible on the boat. One advantage of dealing with the owners is that if you are willing to ask questions, they will mostly give you honest answers. We hauled out the boat early one Saturday morning. We hired a marine survey for the day to provide us with his opinion and write up on the boat. This cost us $18 per foot. The haul-out happens at a boatyard and costs us about $15 afoot. The buyer typically pays for both of these expenses. One piece of advice I would give is not to rely too much on the survey. Preform your own detailed inspection. Ask to run every system, open and close every hatch, cupboards, look in every corner, take hundreds of pictures, check every line and piece of the rig. Our survey was excellent, but he missed a handful of items during the inspection.
Step two of the diligence process is Sea Trials. This is arguably the most fun part of buying a boat. In our case, we scheduled the sea trials after the haul out. This was a matter of convenience or rather inconvenience as I would have preferred to haul out boat after the Sea Trials and only if we decided to continue with the diligence process. That way if we hadn't like the way the boat sailed, we would not need to pay for the haul out! However, we were on a tight schedule and the wind San Diego doesn't usually pick up until afternoon works out well to haul out in the morning and test sail in the afternoon. Or surveyor accompanied us on the sea trial, and we took the boat a few miles out of the San Diego bay. We ran her diesel, raised and mainsail, unfurled and furled the jib, went over the electrical systems, ran the autopilot, radar, nav systems, tacked, jibed, opened every hatch, looked in every bilge. I took lots of pictures and made a video of most of my conversations with the boat owner, so I could go back to them in detail later.
Our closing experience was quite long and drawn out. I imagine that our purchase would have been much quicker if we followed a more traditional path of purchasing a boat from a broker. While a good broker might be able to speed the process along you will pay for it. In our case, we save a lot of money by buying the boat for sale by owner and buying LLC rather than a boat. We hired the Wenther Law Group out of San Diego to help us purchase the LLC. They were very helpful in walking us through the process of buying the LLC. The biggest problem we had with purchasing the LLC was that the LLC created by the previous owner was not documented well enough for the purchase. Wenther was great in helping the seller in organizing the correct LLC documents and forming the new LLC. Getting the LLC in order for the seller delayed the closing by several months. By purchasing and LLC without using a broker the process took a lot of leg work on our end but ended up saving thousands of dollars. A couple of gotchas in closing on a large boat. First finding a bank that will loan on an LLC is important. Second, getting insurance can be a bit of a process and they will require your sailing resume. Start the process of finding the bank and insurance very early in the process.
5. Taking Possession
We took Possession of the boat in the last week of January. This was a pretty simple process. Once our bank funded the load the seller arranged for keys to be dropped off at the boat. We found a slip in a pinch and move the boat too in Chula Vista. End ties in Southern California are short supply so we didn't have a lot of options.
In summary, purchasing a boat is similar to purchasing a house, but slower. It's a complicated process that takes a lot of time and patience.