If you own a yacht, or have been considering purchasing one, you have probably thought about chartering it out. Maybe you don’t have the time to enjoy it like you used to, or you’re looking for a way to offset some of the expenses that comes with owning a yacht. Either way, it’s crucial to know what you're getting into and to make sure your expectations and hopes meet reality.
There’s many variables that go into whether it is beneficial to the owner to charter out their yacht or not. The location, size and make, age, and layout all make a difference in the success of joining a private charter fleet. A charter broker will be able to help you better understand how well your yacht will do. But for the sake of the article, lets assume you have the perfect charter yacht and you just want to know the pro’s and con’s.
PROS
Offset Expenses: You are still paying for your yacht whether you are using it or not. Although you should not expect to make a profit, a successful charter yacht should pay for dockage, routine maintenance, insurance, and crew, at the minimum, Generally speaking, it should save you 40-75% on operating expenses. Yachts with the sole purpose of chartering do have the potential to make a profit.
Keeps it Moving: Many overlook this as a pro, but it IS actually good to have your yacht regularly moving- stagnant fuel, not running systems, etc. can be very bad.
Stricter Maintenance Regime: Chartering your yacht with a reputable company and a good captain will ensure that the maintenance on the yacht is above standard.
Tax Benefits: Your yacht now becomes a business expense, allowing tax advantages you may not have had prior.
Crew: If you have a yacht 60ft+ you will need to have a charter captain and atleast one more crew. If your yachts 70+, it's possible you will need a captain and 2 crew, and it continues going up with size. As stated, a charter program should pay for atleast the captain. A crew guarantees your boat will be up kept to the highest standard in every aspect.
Resale: When the time comes to sell your boat, it has a high chance of being bought by a regular client or
CONS
Random Strangers: If the idea of strangers on your yacht makes your skin crawl- chartering is definitely not for you. Although charter guest are vetted, they still might not respect your yacht as it was their own.
Can't personalize: Do you enjoy walking on your yacht, no bags in tow, going to your cabin and arleady having your bathingsuits and leisure wear organized? Are family pictures in the Saloon important to you? If you put your yacht in a charter fleet, you are limited to the personal items that can stay on the yacht. (Yes, your crew can put everything back before you come on board, but the problem is finding room to store it.)
Overuse: Of course there's going to be an increase on the wear and tear of the boat overall. The cushions, carpets, bedding, etc., will be worn out faster- but that shouldn't be a major concern as the revenues from the charters will be greater than the cost of replacing this *sooner* than you would normally need to.
Insurance: Your insurance will go up as laws mandate a different type of insurance for charter vessels. This could be a minor or significant rise, depending on many things.
You Now Have Restricted Use: This may be a huge concern of yours, although it is easy to solve. Place the yacht in a local fleet, and plan ahead so you can black out the dates you want to use it.
In conclusion, the pros might outweigh the cons to some- and vise versa. Some owners benefit from chartering and others lose money. The best way to ensure success is talking to an experienced broker, and joining a well known charter fleet.