I'm going to give you a legal answer from my jurisdiction, but perhaps not the same in yours. Don't read it for the law, but simply as a posible guide that might help you get to the etiquette. I think the law is a good go to, simply because it is what society turns to when they want to know what their rights are.
In this case, you actually did have a legal agreement. You sold the boat to him, true enough, but there was a condition precedent to the sale. Your pal broke the contract when he did not offer the boat back to you first before selling it to someone else. That is the piece that, for me, informs everything else.
Yes, I know, it was not in writing - but it does not need to be in writing. That is a myth. With a house, you almost need a writing. With a pleasure boat, not so much. True, if it were in writing, you would have proof. But that is the only difference here, and there are many other ways to establish that you had said this. When he bought it, that meant he agreed -- again, in my jurisdiction.
Now, let's leave the law for a moment. You are friends. He knows what you said, even if, to be generous, he has forgotten it. If you jarred his memory, he would probably remember.
If he were a friend of mine, and if I wanted to keep the friendship, I would tell him that I have really appreciated our friendship, but that in order to keep it, I needed to clear the air.
I would stress again that I really did want to keep the relationship, then, I would ask him what he remembered of the terms of the sale.
If he does not mention your clause, I would remind him of it. If he swears he does not remember it, then you can forget it all, kind of, and either allow him to do it possibly do it again, or never sell him anything again. You could also choose to end the friendship or sue him. You might not win unless you have someone else who knows about your sale, or some other good proof, though. (I know you don't want to do either of the last two things, I'm just letting you know what the remedies are.)
If he does remember the clause, I would tell him that I would really would rather have the boat back on the conditions I gave him, but that I know that can't happen. The third party was innocent, and the boat is now legally the property of the third person. Still, I would ask him if there is a way he could make it up to me, so we can both continue to feel good about our friendship.
If he says no, you can still maintain the friendship, but I agree with everyone else, and I would probably think money was more important to him than my friendship. That's a judgment call, and has nothing to do with the law or etiquette.
Still, when I come across things like this, the law helps me figure out the etiquette of the situation, and that informs my final decision.