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New Yachts vs Pre-Owned Yachts & Charter Yachts

There is always much debate about which is better to buy: New or Used Yachts?

There are pros and cons to each option. Buying a new yacht does not guarantee a trouble free yacht. Yes, there may be warranties to cover repairs, but even that does not ensure a hassle-free yacht. And buying a new yacht results in a big depreciation of the vessel the minute the yacht hits the water.

Buying a used yacht can offer the possibility to buy a bigger 2-5 year old yacht that you would not have been able to afford new but beware, make sure that you go into it with open eyes. Nonetheless, a good, clean used or "previously loved" yacht is great if you are somewhat handy with repairs.

An analysis of the pros and cons of each option follows this video in which Stephen explains the situations that call for considering each of the yacht buying options.

 

 

New Yachts

Things To consider When Buying A New Yacht

  • Often "boat show specials" are available before and during shows that can be significant discounts
  • Ask specifically if the boat builder has any unsold inventory or unsold production slots
  • Ask if the dealer has any inventory they would really like to sell i.e. discontinued models - they may have significant discounts 
  • Mention that you would be agreeable to have your yacht displayed at any up-coming boat shows in exchange for extra equipment or a discount

New Yacht Pros

  • Newest designs, materials, technology
  • The engineering that goes into a new boat produces a stronger, lighter, faster hull
  • Much less maintenance in the first 5 years
  • Mechanical and electrical systems are more efficient and safer
  • The newer engines use less fuel and are quieter, easier to maintain, more reliable and more environmentally friendly
  • Warranties are in place for between 2-5 years depending on the manufacturer
  • Financing is more readily available and at lower rates
  • You choose the options and upgrades you prefer
  • You get exactly what you want

New Yacht Cons

  • Fewer choices - only a few new models may fall within your price range
  • Quicker depreciation
  • Cost more initially
  • Not all the "bugs" may yet have been worked out, specifically if you buy the first two or three models of a new range
  • Consider the impact that foreign exchange makes - this could be good or bad, depending on how well the dollar stacks up to the Euro at the time of purchase
  • If you have dollars and are buying a yacht in Euros there can be huge price swings from year-to-year

Pre-owned or Used Yachts 

Yacht sales have seasonal price tendencies. We discuss in detail in this article how in relatively "thin" markets like the catamaran market, it is possible to see large swings in prices in just 6 months. We have seen incredible price changes from year to year and I think understanding this factor alone can save you many thousands of dollars. Consider this: every year, most catamaran buyers are buying for the winter "high season" in the Caribbean. They generally start their shopping in late August and this buying activity ends in December. The lowest priced or best deals sell first (late May-June-July-August) and the highest priced "worst deals" occur later on (October-November-December) but this can vary by one month in a given year. Every year, the very highest prices for a given model are usually seen in December or perhaps January. 

Pre-owned Yacht Pros

  • Slower depreciation, the original owner has already taken the hit and the 5-year old used boat should sell at around 60+% of the original value
  • Bigger "bang for the buck" - it bemores more affordable to buy a larger boat 
  • You may find you have a bigger choice of makes and models since there is a larger selection and variety than new yachts in your price range

Pre-owned Yachts Cons

  • You inherit problems of the previous owner
  • Appearance isn't always an accurate indicator of value. You MUST employ a competent surveyor
  • Boat maintenance increases after 7 years
  • Beware of the "fixer-upper". Most people grossly underestimate what it costs to refit a used boat. They say, "Oh, I can do a lot of the work myself!"... But they don't understand that a lot of the work is highly technical and the technicians required are priced in the stratosphere sometimes.
  • Read our article: Top ten catamaran buying tips 

Charter Yachts

Read an explanation of charter yacht programs.

Charter Yachts Pros

  • Costs of ownership are reduced through charter income 
  • Sometimes there are additional tax benefits by operating your yacht as a business
  • A professional will maintain the yacht for you
  • When you are done sailing, just walk away and the boat is cleaned and maintained
  • If you only have four weeks of sailing per year or less, consider putting your boat into charter

Charter Yachts Cons

  • The yacht will receive additional wear and tear and can depreciate faster than a "never-chartered" boat
  • Charter clients have been known to damage the yacht however, the charter company does carry insurance coverage for such incidents
  • Most charter companies restrict the equipment and layout you can have
  • You must leave the yacht at the charter base year-round and cannot be moved around at will

Contact Us for a more indepth discussion on this subject

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