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Old 06-19-2013, 04:55 PM   #1
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Default Selling or "Flipping" Boat from US to AUS?

Hello,

I am curious about sailing my boat, a 39' Fountaine Pajot from U.S. to Australia to get a better price on it in the market. Is this possible? Has anyone ever 'flipped' a boat in another country for a relevant mark up?

Thanks,
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Old 06-19-2013, 10:14 PM   #2
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The market in Australia is just as slow here, but prices are better. You might be stuck here a while (read: many years!).

There's really only an advantage for the buyer. If they're willing to buy sight unseen and sail it back from the US or travel around looking at boats before buying then it can be cheaper.

Flipping only works well in a bouyant market.
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Old 06-20-2013, 12:22 AM   #3
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What Haiqu said ... I know of several boat that I would consider good deals that have been on the market for over a year. I also know of one boat that sold the other day at a very cheap price after being on the market for over two years.

Boat prices appear higher in Australia than the US but most of those are the asking prices. I have heard of ridiculous prices being accepted by owners just to move their boats. A close friend not long ago had his boat advertised for 49k and accepted 20k for it eventually as he wanted to get on with his life.

I do not feel that the cost of bringing the boat to Australia and paying the duties involved, (yes there are substantial fees to be paid if you sell while in Australia), then staying here or leaving the boat in the hands of a broker till it sells, would net you any gain financially over what you could realise for the boat in the US.

I reckon you should sit down with pen and paper and work out the financial end and not be romanced by the asking prices of boats advertised here.

Think:

Cost of transporting the boat to Australia.
Customs fees and GST for importation of the boat ... must be done or cannot be sold in Australia.
Your expenses being here for an indeterminate amount of time ... at anchor living on the cheap ... allow at least 1600 a month realistically.
Or Putting it in the hands of a yacht broker and paying his commission "IF' it sells.
Flying back to the US.

Hope this gives you something to think about ...

Lexx
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Old 06-20-2013, 01:57 AM   #4
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Oh and I forgot that Customs add in the cost of transporting your yacht to Australia from the US for GST (tax) purposes ... yes they get you coming and going ...
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Old 06-20-2013, 02:33 AM   #5
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One benefit of sailing your boat to sell it in Australia is that you get to sail across the Pacific. Realistically, that will take you at least two seasons....and it will be heaps of fun. Ocean crossings are not without expense.

A boat well prepared and ready for coastal sailing is a different animal to one prepped for ocean crossing. Sails and rig, safety gear, first aid, electronic equipment and so much more need to be checked, upgraded and or replaced where necessary.

An owner sailed Fountaine Pajot of 39' would sell well in Oz. It is a very desirable boat. However, If it's history is tied in with a charter fleet, it's appeal will be significantly reduced both because of the charter layout and because former 'taxi cabs' don't attract big dollars. Aussies are very particular about the boats they buy,,,low end boats are expected to be projects...high end boats such as yours are expected to be in first class condition.

The Australian market, although slow, will realise you a better return than the US market, but if it will offset the cost of preparing for, then sailing across the Pacific (especially when you factor in a couple of season's lost income), is debatable.

The cost of living aboard in Australia is less than in the US, especially at anchor. Import duties are levied at 5% of the boat's value on the market in it's home port plus 10% GST, and the cost of delivery can be deducted from that value before duties are paid (as long as you don't take years over the delivery). But you would need to register the boat in Australia firstly, before you arrive. The cost of Oz rego is about $1200, not including the cost of formally deregistering the boat through the USCG. (See appended extract from Australian Customs, below)

If you then decide to return to the US after only going say as far as Mexico, you must realise you would be in a foreign registered boat which would then require you to import it back into your home country at some considerable expense.

I have friends who sail one boat from the Americas to Oz every year. They buy only proven cruising boats (their latest was a Hans Christian of about 39'). In 8 years their worst return was 35%, their best 75%. Their boats have all sold within 3 months of arrival. But they don't make as much as this would seem to suggest.

Preparation upgrades, repairs and maintenance eats into their profits, as does the cost of living and sailing thousands of miles, but they are able to sponsor themselves into a wonderful lifestyle. I think if their motive was solely profit, they would find an easier and more lucrative venture.

They tell me they can transport a 40' monohull (a onemaran) on the deck of a boat delivery freighter for about $10,000 from the US west coast to Oz, but again, their objective is not the profit but the trip. A catamaran may well cost twice that, I guess.

I would say that if you want to have a great holiday and to then recoup your costs but not want to make a big profit, you should sail your lovely boat to Australia. If you seek only profit...don't bother, you will be disappointed.


Where the boat is sailed to Australia, overseas freight will be determined having regard to essential sailing costs incurred under the most commercially viable conditions. Such costs would include sailing expenditure necessarily incurred while the vessel is actually sailing (and entering and leaving) those ports of call on the most commercially viable route. It would not include any in port expenditure related to the vessel's period of stopover.




Where supported by sufficient/reliable information, essential sailing costs would also include:
  • cost of maps, charts pilot books, light/radio lists, etc.
  • crew's hire/wages or forage allowance in lieu
  • victualling or food costs (does not include tobacco and alcoholic beverages)
  • bunkering or oil/fuel costs.
These costs can be deducted from the surveyor determined value before the cost related to import (duty and GST) are applied, providing the boat is Australian registered and as long as the Australian surveyor (another considerable expense) ratifies the value you claim as valid. In most cases the value will be determined BY THE PURCHASE PRICE...so bring your documents.
The AMSA and Customs inform me privately ( I bought my boat in the US and am sailing it home to Oz) that they have a high degree latitude when assessing each and every case. While there are specific rules governing the import of boats, the differing values and means of delivery call for flexible assessments....I expect sometimes this can be a benefit; other times a liability.
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Old 06-20-2013, 02:44 AM   #6
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Importing a yacht into Australia...

The following is taken from importing a yacht

the Australian Customs and Border Protection Website ...

Yachts are subject to a general rate of duty of 5% based on the customs value (basically the price paid) and 10% GST calculated on the customs value plus international transport and insurance plus the duty.

Privately imported yachts are generally valued using the transaction method of valuation when purchased overseas new or second-hand for export to Australia. Circumstances where Customs may use an alternative method of valuation include such situations as where:

the yacht was constructed by owner/labour;
the yacht has been extensively modified since purchase;
the purchaser and vendor are related parties and that relationship has influenced the purchase price; or
the original purchase price is too far removed in time.

In these instances the yacht will have to be valued by a marine surveyor in Australia. This valuation will be based on the market value and as such will include elements such as customs duty and GST. Customs will have to deduct these elements plus overseas transport from the local valuation.

Where the yacht is sailed to Australia, overseas freight will be determined having regard to essential sailing costs incurred under the most commercially viable conditions. Such costs would include sailing expenditure necessarily incurred while the vessel is actually sailing (and entering and leaving) those ports of call on the most commercially viable route. It would not include any in port expenditure related to the vessel's period of stopover

. Where supported by sufficient/reliable information, essential sailing costs would also include:

cost of maps, charts pilot books, light/radio lists, etc.
crew's hire/wages or forage allowance in lieu
victualling or food costs (does not include tobacco and alcoholic beverages)
bunkering or oil/fuel costs.

This is an indicative rather than exhaustive list, if you have any doubts or queries seek further information from a Customs Information and Support Centre 1300 363 263
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Old 06-20-2013, 03:22 AM   #7
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Hi Del, I'm not disputing your assessment but I am basing my submission on the evidence provided by my sailing mates (the importers above) and as a result of my own research regarding the purchase (US), transport and import of my own boat to Australia.

There is a reasonable degree of ambiguity in the rules regarding the import of boats. Largely this relates to whether you are importing the boat with the intention of selling it for a profit, whether you are an Aussie or an alien, or if you are importing (my case) to retain the boat; in which case the assessed value is of academic interest only...and possibly of some small interest where the owner may want to comprehensively insure the vessel. Customs also will determine whether the delivery trip is purely a trip for the purpose of delivering the boat to Australia, or if in fact it is a pleasure trip disguised as a delivery. Usually, they inform me, this depends almost entirely on the time taken.

"This valuation will be based on the market value and as such will include elements such as customs duty and GST. Customs will have to deduct these elements plus overseas transport from the local valuation."

Either way, if you have a $100,000 boat which costs you $15,000 to bring to Australia, then Customs impose 5% duty, then another 10% GST, you have a boat which has already made you a profit of $250.

Best wishes,
Dave.
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