Charter Boat Ownership – Find the Funds

Charter Boat Ownership Can Make Financial Sense

Many people discover the fun of catamaran sailing through trying a charter boat.  But it’s not just holiday makers and newbie sailors who make a start in charter – so do boat owners.  With a little planning and some smart choices, you too can bring the cruising dream to life by buying a charter boat.

Many sailors can’t wait to go cruising, but they face some hurdles.  Often, one of those is funding the cost of a catamaran equipped for a great adventure.   But is the cost as great as you think?  It doesn’t have to be.  Buying a boat for charter can make the numbers work for you.  And if you’re reading this then you’re probably thinking of going cruising in a few years – and that means now is the time to take action.

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How it works for you

Start on solid ground:

Most charter fleets around the world depend on owner boats being available for charter – the charter company itself often does not own the boat, they’re only brokering its charter schedule.  These fleets return the boat owner a percentage of the chartering revenue.  Depending on the fleet, location, and boat layout, charter fleets offer between 7-10% return on investment (call us for more detailed information).

Train up:

Your boat won’t be sailing with charter guests every week of the year.  In the off season and in any unsold weeks, you train up by sailing your own boat, preparing you and your family for your great adventure.

Balance the books:

As your boat starts to return some of the investment, you’re beginning to “pay the boat off”.  While that’s happening, the boat is depreciating in value – but not very quickly.  Depending on the layout, Seawinds hold 70-80% of their value after 5 years, and 60-65% after 10 years. Plan it right and you’ll have paid off more than that through the charter revenue.

Bow out:

When the numbers are right, and you and your family are ready, withdraw the boat from charter and go cruising – at a time of your choosing.

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Important considerations:

Top cat

Catamarans are growing so quickly in popularity in part because these numbers work.  Compare the charter ownership options with any monohull, anywhere in the world, and you’ll soon discover cats are top.  The space on offer, with private cabins away from the social space in the saloon sets them apart.

But which one’s right for you?

It’s important to consider the layout carefully.  4 cabin boats return more charter profit than 3 cabin versions – up to €1,000 per week in European high season, A$1,200 per week in the Whitsundays, with similar figures in other chartering locations.

But… 4 cabin boats are less suited to your cruising adventure when you do bow out.  That 4th cabin comes at the cost of master cabin space, and often results in extra plumbing and maintenance costs.  So the resale value is lower after being in charter.  And it’s when you go cruising that you’ll notice those maintenance shortcomings.

So again, plan in advance and strike the balance that works for you.  If you think your financial circumstances will improve significantly after a few years, and you might be interested in trading up and going cruising in a larger boat, then stay away from a 4-cabin version which won’t keep its value so well.

If you have a large family and don’t mind a smaller master cabin – take a 4-cabin boat.

Brand

Just like the 3 vs. 4 cabin options, the brand of boat has a big influence on the numbers.  Some mass-produced brands unashamedly appeal to the charter market.  The 4 cabins are large, at the expense of strength, reliability and cruising practicality.  So they attract bigger fees for a charter week booking… but in the end the boat hasn’t stood up to the rigors of charter service as well, and few cruisers want to take one on their offshore cruising adventure.  So the charter revenue is a short term advantage quickly sacrificed back in resale value.

And where?

Location is important.  Find a balance between the most lucrative charter locations – which are often far from home, compared to something closer to home which has lower charter revenue potential.  If you have less cruising experience and want or need more time training on your boat, choose somewhere closer to home where you can more easily access the boat in off-weeks.  It might be your flight connections which determine the destination.

Top Tip:

Just because you want certain cruising equipment, doesn’t mean you need to make it available to charter guests.  Want a screacher, bowsprit and performance sails?  If you have some storage space at home, order that extra equipment at lower cost with your original boat order, then remove it for the charter season when the boat can carry Dacron sails without a bowsprit.  It will be ready and waiting when you go cruising, and you’ll already know how to fit it.

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Buying a boat for charter, why the numbers make sense:

  • Resale Values:  Seawind Catamarans retain high re-sale values, even after extended periods in charter
  • Charter Appeal:  Catamarans are top-choice for charter guests in all regions of the world
  • Cruising Popularity:  Cruisers, especially families, prefer catamarans for a better cruising life
  • Enduring Popularity:  Catamarans are only becoming more and more popular – your boat will stay attractive for future cruisers when you complete your own adventure

Jay Nolan

Posts you might like: 

Download Seawind Magazine 2018
Cruising a Seawind 1160 – How we got there

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