Buy a boat and then charter it?

Given what's happening with the economy etc.
I'm curious to know how utilisation rates have changed on charter boats.
When someone puts their boat into Charter Management they are usually told how many days of booking to expect through the year. How has this compared with reality?
Has anyone been told that their boat is being dropped from the books because it's rarely chartered?
Putting your boat with a sailing school is very different to putting it with a Charter Management company.
The sailing school will make full use of your boat. They have committed to covering a substantial proportion of the costs so have to. Some Sailing Schools go slightly further. They will cover costs but once the boat is used over a certain number of days they will also pay for those additional days. First Class Sailing (stones throw from Stormforce) at Shamrock do this.
However, with a Charter Company you are very dependant upon bookings to offset costs.

If you are financially dependant upon getting income for your boat then the Sailing School route would be an attractive route to go. I would certainly chat to some sailing schools and charter management companies before taking the plunge. It may well dictate the type, size and where you berth the boat.
 
Nice to come back from the weekend with all this feedback. Some good advice there. I didnt realise how much it costs to get a yacht coded. I thought is was simply safety equipment and making sure things are safe. 10k seems alot even for a larger craft. I can't see what would swallow up that money. The idea of something a bit niche does appeal as thats the sort of yacht i'd like to own in the first place. There are plenty of shiny white Baverias and their like out there. Having a yacht that offers something a bit different should gather some interest.
 
The cost of coding depends on the starting point. The figure I quoted was based on a "standard" production boat, which as you know always needs extras to make it usable. So that figure includes many items that would be "normal" equipment anyway. The extra for coding comes from having to specify particular and extra equipment, possibly modifications - for example back up power to the VHF, stability calculations if not already available and cost of the survey.

Be wary of a "niche" boat - by definition it means something that is only appreciated by a few, therefore only likely to be in demand from a few! There is a reason why standard boats are used. Just the same as buying - they appeal to the broadest market.
 
Don't

There has been a massive change in peoples attitudes re other peoples property and their own belief in their abilities and rights.
When I started chartering my boat 7 years ago things were good charterers enjoyed hand over brief and generally looked after boat or accepted loss of some of deposit to replace or repair.
Not any more the last 2 years have been hell people lying through their teeth to keep their deposit,
The last group allegedly a Solicitor, A Police Inspector and a retired Co Director from the Bristol area did so much damage as to make theboat unsafe to go out for the rest of the season. They fought tooth and nail not to pay a penny and the Club organiser threatened to report me to the HSE for storing 2.5 ltr of petrol in anchor locker. Yacht charter is a small community needless to say details have been passed onto other charter cos , good luck next year fellas as your names are now circulated.
Hopefully these people have read this post.
Dont charter your boat bit like having J Saville as a house guest.
Keith
 
neil1967 said:
Abroad is a different issue. I have had a Jeanneau 36i in charter in Turkey with a smaller charter company for 5 years now. She is more than covering her costs - and is being maintained to a far higher standard than the larger charter companies manage. Whether she returns a profit in the long term will largely depend on what we manage to sell her for, but on current returns I am reasonably optimistic - and that is not taking into account the value of the 2-3 weeks each year we use her. Happy to PM further details if anyone is interested.

Neil
Click to expand...
First of off I am not being disrespectful - I am genuinely interested.
I am intrigued with this model.
Would you not be better off chartering a boat yourself for 2-3 weeks useage a year?
Owning a boat and not been able to keep your personal gear onboard means when you turn it up to use it is no different to chartering a boat.
Even if all your running costs are met in each and every one of the five years, the depreciation suffered at the point will be how much (£40k?) - clearly I do not know - but isn’t that more than it would cost to cover the 2-3 weeks of chartering?
Bearing in mind you are upfronting the capital to acquire the asset or financing it - it does not appear to be a good deal to me.

I could see some benefit if you were getting 2 months onboard (say, month at start and end of season).

Genuinely interested in your answers/rationale.
 
NormanB said:
Bum never noticed that - still the 5 years has passed so may get an accurate assessment. ;-)
Click to expand...

Despite being 5 years old the issue is still relevant.

Whether it is with it depends entirely on your objectives. You have to be clear that it is a long term deal that locks you into a very illiquid asset, that is it is difficult to bail out if your circumstances change. I bought my boat on a typical 50/50 deal where I painted half the cost of the boat linked to a 6 year contract with abides to using 2 or 3 weeks a year then taking the boat over when I retired. The interest payments on the money I borrowed were less than 2 weeks charter each year. At the end of the contract I paid VAT on the original price I paid.

I used the boat for 3 years until circumstances changed then sailed it back to UK where I sold it 4 years later for much the same as I originally paid for it, less the cost of getting it back to UK.

Overall I was very happy with my choice but would have been even happier if I had more time in the Med before coming back, but that's life.

So it is not for everybody, but like every investment you have to look at the costs and benefits and decide for yourself whether it is worth it for you.
 
Personally I would NEVER charter out my boat, far too much of an investment for me to let the poor thing be thrashed by some uncaring chump...

I know there are some who would look after her reasonably well but for me, I just wouldn’t. Charter boats age really quickly.

I’ve witnessed the abuse on charter boats by a bunch of lads who have “ paid for it so we’ll use it”.
 
As a fleet manager Interesting reading over this again; the range of points in my opinion illustrates owning a boat in charter works for some but not for everyone. Loads of scenarios I recognise like the battery and alternator observations -
Some of our owners will take a month or 2 at beginning or end of season and as such have a yacht in spot on condition in a beautiful location at vastly reduced if any expense,
Others will charter as much as possible to turn a profit at end of year with some personal use. After adding in the cost of purchase, income that might have been produced if invested elsewhere my usual observation is that there are better ways to make money than boat ownership.
But we all know as boat owners I think that this is not why we buy boats. Point is charter is a business & if done well it can work. It will certainly save you money you might otherwise have spent (written off)
Above all its fun and you meet some great people sail in great parts of the world where you might otherwise only have paid a brief visit. Unlike a house you can always move her.
 
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