Is it worth it!?

10 minutes read

Buying a new yacht is rarely seen as a good investment.  This was the case for decades and certainly for many years in a row before covid-19 pandemic hit us and changed the world.  When it comes to investing in general, buying a new boat it seems the worse decision you can make.  Boats are name expensive to buy, even more expensive to run and ultimately can cost someones life too if handled improperly, especially in adverse weather conditions. 

However, in real terms, it seems that nowadays it’s all about avoiding huge inflation numbers.  There is a run away from currencies such as Russian Rouble, Turkish Lira and maybe increasingly also Sterling Pound, Euro and even US$ despite huge increase in value of it against its main rivals from UK and Europe.  Finding that coveted fund, crypto currency or yield in general that beats double digits loss that so called fiat currencies are experiencing nowadays is the key to ultimate success.   As an example, investors who last week put some money into Ethereum crypto currency, gained 14% instantly simply on the news that Goerli Testnet went live, which meant that Ethereum’s dress rehearsal for mid-September launch of new proof-of-stake blockchain that is expected to reduce gas fees and speed up transactions was successful.  And that was only a test, rather than the real deal itself.   In real terms this also means that amongst major crypto currencies, only Bitcoin will remain on energy demanding and relatively slow proof-of-work of system.

Many fund managers also promise regular, quality returns, investing in major stocks such as TESLA, APPLE, SAMSUNG or COCA COLA seems to give increasing or regular dividends and returns too.  Stock options are by now an old way to get huge returns, albeit attached to potentially huge risks and buying carbon credits may also bring in some returns.  For an existing yacht owner or an aspiring live-aboard sailor keen to circumnavigate the world, buying or investing into a new boat remains a risk too.  Given huge disruption across the world and in terms of just-in-time supply and delivery of boat parts and equipment, the manufacture of both sailing and motor yachts seems to have not only been delayed but in some cases, frankly stalled almost.

This created an investment opportunity for yacht buyers. Buying a manufacturing slot for a highly popular sailing catamaran such as Sunreef 60, Sunreef 70 or even Sunreef 80 or Sunreef 100 is a game worth considering when it comes to investment alone.  The same situation is with Lagoon 65 and hugely popular Lagoon 77 supercat. These highly popular charter and private yachts alike, simply cannot be found even on a second hand market any longer. Some of these models are now accepting orders for 2025 already as taking delivery of a new Sunreef in 2023 may be impossible unless the order is made in 2021 or maybe early 2022.  The same is likely to be across many other brands of sailing or power catamarans as ordering a new Bali 5.4 for example, seemed a poor move for a buyer who placed an order in 2020.  One particular boat for example was due to be delivered in September 2021, yet by August 2022 it is still not certain if she will hit the water in September 2022.  In charter terms, this created a huge disruption across the booking lists as both regular sailing holidays in the Caribbean, long-term charters in the Bahamas and even transatlantic crossings during ARC and from Gran Canaria to Saint Lucia all got cancelled or re-booked.

For an investor in these models, this almost proved fatal as losing necessary charter income to finance the lease of purchased boats or pay salaries of yacht managers, captains, and even brokers who arranged charters in the first place this move proved as a loss.  Given that these orders were placed before or during covid-19 pandemic, when disruption of supply chains did not hit home yet, this was not surprising.  The new buyer market scenario has in the meantime developed however as there is lack of new boats on the market while the same pandemic created a new need for self-isolation and social distancing which is perfectly achieved when sailing. In other words, sailing as a hobby, an activity, a type of holiday or as a boat ownership has seen huge increase in popularity and this created a new type of boat buyers.  As a result, buying a new boat, regardless of when the delivery is going to take place, suddenly seems like a good investment.  Those lucky to be taking delivery of a new Azimut, Sunseeker,  Riva, Sunreef, Bali or for example a VAAN catamaran in 2023 are likely to see a good % increase in value on their agreed purchase prices.

In fact, owners of second hand boats are already reporting amazing news for their pockets, as selling a boa they used for several years for more than they originally paid for it is an amazing achievement.  Usually, a boat such as Victoria 67, a Fountain Pajot luxury sailing cat would normally lose around 10% of her value every year.  Given current situation with delays in launch of new boats, such models are likely to be gaining 10% per year in fact.  Those newer ones such as Victoria 67’s successor, Alegria 67 is even more popular and buyers of such boats that would have taken delivery or managed to buy a second hand boat in early 2022 are the lucky winners.

As a result, I feel that those with funds in their bank and a keen desire to regularly sail or motor up their favourite coastline should consider buying a slot of a desired yacht immediately.  As a matter of fact, it may already be a bit late to guarantee a profit, yet not losing money in yachting terms as an owner is already a great achievement.  If you are one of those with funds and desire to sail therefore, we would recommend to get offers in immediately and considering buying either a motor yacht or a sailing catamaran.  These are likely to be most popular models, albeit power catamarans, luxury sailing yachts from brands such as Oyster, CNB and Wally are also likely to be proving beneficial in years to come.

If you are therefore not keen to risk your money on stocks, options, crypto currency or funds, do considering spending a good amount of your savings on a new VAAN R6 or O YACHT 6 for example as such an investment is likely to prove a good one.  If you can’t force yourself to make such a move with your existing knowledge, experience and insights, you can indeed seek an advice either by bank investor, fund manager or yacht sales broker.  One of the best investments can namely be buying a new PUCCINI YACHT 82 JING as by decorating both interior and exterior of a prestigious luxury motor yacht with Royal Chinese CLOISONNE patterns, taking delivery of such a boat already in 2023 at a reasonable discount and most importantly treating the boat as an investment by keeping her in a prime location such as London’s Tower Bridge or wherever a huge number of well-heeled Chinese tourists are likely to roam during their holiday, an investor is likely to both receive a return on regular charters as well as potential increase in yacht value as that would be a first such a yacht in the World and buyers of expensive Chinese vases that are made with same century-old technique already know that there is a good value in spending 100’s of thousands of GPB pounds or US$’s in acquiring such rare pieces of art.