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Even the best and well-cared-for boats have a finite lifespan. Sooner or later, your boat will start aging, and you'll be ready to start considering getting rid of it. That might mean selling it and using the money for some other hobby or trading it in for a new version of the very same model.
Whatever your goals are, you have a few options for managing the end of your boat’s life. Namely, you can trade in your boat or sell it to the highest bidder. Which one of these options is better and how should you make the decision?
What Are Your Options?
Let's start with the biggest options available to you.
- Trade in the boat. For starters, you could trade in the boat with a dealer. Usually, in this arrangement, the dealer will provide a value for the boat you're about to trade in. You'll surrender the boat to their possession, and they will take that value and deduct it from the price of a new boat. You'll walk away with a new boat in your possession for much less than the recommended sticker price.
- Sell as an individual. You could also sell your boat as an individual. Instead of treating your boat into a dealership, you can shop around for a willing buyer who wants to pay you directly to gain ownership of the boat. This can be a time-consuming process, but you'll usually end up with more money in your pocket than if you trade it in with a dealer.
- Sell through a broker or dealer. If the process of selling and marketing your boat sounds like a hassle, you could also list the boat through a broker or a dealer. In one of these arrangements, you'll still sell your boat to the highest bidder, but someone else will manage most of the process for you in exchange for a small cut of the proceeds.
- Scrap the boat. Of course, if your boat isn't in good condition, or if no reasonable buyer would ever want it, you may have trouble trading it in or selling it. In these rare scenarios, your best option may be scrapping the boat or recycling it.
Advantages of Trading In
What are the advantages of trading in a boat?
- A simple, hassle-free process. For the most part, trading in a boat is a simple and hassle-free process. You'll have to spend time putting the paperwork together and dropping off the boat dealer (in some situations), but you won't have to go through the steps of listing your boat for sale or haggling with various bidders.
- Faster resolution. Generally, trading in a boat also leads to a faster resolution. This isn't always the case, but it can sometimes take weeks or even months to find a willing buyer for your vessel. By contrast, trading in could allow you to complete the process in a single day.
- A new boat. When you trade in your old boat, you'll usually get the opportunity to buy a brand new boat. That's an exciting time for any boat enthusiast, regardless of how many vessels you've owned in the past. Of course, if you do sell your boat independently, you can also use the proceeds to buy a boat; Trading in isn't the only way to get the new vessel.
- Tax advantages. Some people like the idea of trading it because of the tax advantages. The money you make by selling your boat may be subject to taxes, but if you're trading in the vessel and applying the value to a new purchase, you can avoid those taxes entirely.
Advantages of Selling
And what are the advantages of selling?
- A higher sale price. Dealers usually want to offer a fair price for your trade in, but they're never going to offer you as much as a willing buyer operating outside of the system. If you sell the boat on your own or with a broker, you'll usually fetch a much higher sale price.
- More flexible options. You also have much more flexible options when it comes to listing your boat. You can choose one or more of several different platforms for online listings. You can choose to fix up your boat or sell it as is. You can also choose whether to work with a broker or dealer or try to sell the vessel by yourself. You're much less restricted this way.
- Control and transparency. Some people appreciate the control and transparency afforded by selling a boat yourself. You get to talk to prospective buyers directly and choose who gets ownership over your vessel next.
- Liquid cash. If you're going to buy a new boat no matter what, trading is very practical. But if you're not sure what your next vessel is going to be, or if you just want more flexible buying power with the proceeds, you're better off getting the liquid cash by selling your boat directly.
Variables to Consider
There isn't a single right answer to this question, because every boat and every boat owner will be different. These are some of the most important variables you'll need to consider when trying to answer this question for yourself.
- Current value of the boat. How much is your boat currently worth? How much could you potentially get out of it if you sell it on your own?
- Current condition of the boat. Is your boat in good shape? If so, you may have an easier time selling it.
- Your future boat. Are you interested in a new boat? If so, trading in starts to look more practical and more appealing.
- Patience and time horizon. How much time are you willing to spend trying to sell the boat? It can sometimes take a long time to find a buyer, but are you willing to spend that time?
- Personal tolerance and preferences. Some people trade in simply because they don’t like the idea of going through a sale process on their own. Often, these financial decisions boil down to a matter of personal preference – and there’s nothing wrong with that, so long as you’ve considered all your options.
So, should you trade in your boat, sell it by yourself, or sell it with a dealer? Unfortunately, we can't help you answer that question beyond what we've already done. But we can help you list your boat for sale and get the highest possible price for your old vessel. Start listing your boat with one click today or contact us to learn more!