What is a Yacht Broker?
If you are on the market for a yacht or boat, you may have heard the term ‘yacht broker’, but many people are unaware of what role a yacht broker has. Yacht brokers are specialists that assist the buyers and/or sellers of a yacht. They act as the representative of a sale/purchase. Similar to a real estate agent, yacht brokers are paid a commission by the seller to list a yacht on the market and handle the inquiries and negotiation processes.
Yacht brokers attend several stages, including the inspection, water trials, and if successful, delivery. Yacht brokers who help the buying client with locating a yacht, qualifying it, and handling negotiations are not commonly paid commissions from the buyer, rather the broker will share commissions paid from the seller. They are known as the Listing Broker (represents the seller), and Selling Broker (represents the buyer).
There are only two states which require Yacht brokers to be licensed and bonded, they include California and Florida. This is to help keep the public protected, but each state has different rules regarding the qualifications of ‘yacht’.
To be considered a yacht, it must be longer than 16 feet, usually referred to as LOA (Length Overall), but weighs less than 300 G.R.T (Gross Registered Tons). To take part in the sale of a yacht, a $10,000 bond must be submitted to the state, and have a valid license from California Division of Boating and Waterways (DBW). Prospective sales people are required to take a two-hour written test.
With yachts over 32 feet LOA, a license is required. A $10,000 bond must be submitted to the state, have a valid license from Florida Department of Business and Professional Regulation (DBRP), and have a criminal background with fingerprints. To create a yacht broker company or ‘broker of record’, a $25,000 surety bond is required. Each company has a single ‘broker of record’ position, which is responsible for all sales people, yacht sales, and sales reporting to the state.
Both California and Florida require a sales person to be licensed for two years prior to applying to be a broker.
Yacht brokers in the United States and Canada can earn qualification credentials in Certified Professional Yacht Broker (CPYB). To do this, they must successfully finish a three-hour written test. All seven yacht broker associations support and offer the CPYB program in North America.
Within the Netherlands, a yacht broker that holds qualifications is referred to as an ‘MCI Certified Yacht broker’.
Location and Commissions
It is more common to find yacht brokers near popular yachting regions, such as coastlines. For example, within the Caribbean Sea, Mediterranean Sea, and on the east and west coast of the United States.
Commission rates are typically paid by the seller, which is an agreed upon amount. However, the common percentage rate is a 10% commission. Many brokers will negotiate this amount based on different factors.