Chartering Your Yacht

Weighing the pros and cons of Chartering your Yacht

Purchasing a yacht is an exciting investment and the first few trips may come rather quickly. Then, when the “newness” of the purchase wears off, owners often find themselves wondering how to manage their yacht when they are not able to operate the vessel. One way in which to optimize the cost of ownership to the cost of use is to charter the yacht. However, this option is not for everyone and one should consider the pros and cons of Chartering a yacht beforehand. Here are a few of the pros and cons of doing such.

PRO: Tax advantages and income

The biggest advantage to chartering your yacht would be the financial benefits that you could gain from doing such. As the yacht is chartered either by the duration of use or per use, there is a market to have a substantial income which can then be applied to either the cost of the yacht or the management and upkeep of the yacht. Furthermore, the government does allow for tax benefits associated with chartering a boat to be applied. Note that you may need to have a business license and to count the yacht as a business asset. Check with your local business and zoning to find out the specifics on tax exemptions and rebates or consult a tax professional.

CON: Cost of upkeep

Just like a landlord for an apartment  or a house for lease, owners of their yacht should understand that not every person who rents the yacht will be ideal and take care of the yacht to the best of his or her ability. There will need to be funds allocated to the upkeep and maintenance of the aesthetics. While damages should certainly be factored into the chartering contract, general wear and tear should be accounted for.

PRO: The yacht’s mechanics are kept mobile

For a yacht to work in prime condition, the mechanical elements do not need to sit. Sitting for a yacht is apt to cause rust, erosion, leaks, and a number of other issues. When a boat is chartered, these components are used frequently and thereby have a far less probability of damage, failure, or decline.

CON: Engine miles

While it is necessary for the yacht to be used regularly for mechanics, the downside is that when the yacht is used the vessel is gaining miles upon the engine. This is a low disadvantage considering the income gained, the mechanics which are kept in working order, as well as the warranty which typically is associated with Yacht ownership.

PRO: You get to decide who and when the boat is used

Chartering a boat does not give up your ownership of the boat or remove your option to deny use of the boat. You are still the person who decides when and where the boat can be used. This means that if you decide that you want to take the Yacht out on the water for a weekend, you can do so. Some chartering companies do have times built into their contracts which may limit such times, so ensure that your yacht broker looks over the details thoroughly.

Cons: Insurance may be steep

Due to the fact that strangers will be using your vessel and that you will not be able to personally guarantee how well the person will avoid damage to the yacht when they are chartering it, boat insurance on your vessel may be higher than if you were to use the yacht only for personal excursions. Yet, if you weight the increase against the cost of storing your yacht, you may find that you save money depending upon your yacht and the services offered by your marina.

Other considerations

Apart from weighing the pros and cons of chartering your yacht, you should note that certain yachts will be in a higher demand than others. Mega Yachts and super yachts are not apt to have the demand that the 40 to 60’ yachts will have. Additionally, the location will play a major factor into the demand for chartering. Those areas which have a high tour rate are more apt to have a larger demand for chartering.

How to charter your boat

The best way in which to charter your boat is to use a boat brokerage firm to do so. The firm will establish the contract between the parties as well as help to determine a reasonable medium between the owner and the purchaser’s expectations for the yacht. Furthermore, if inspections and other documentation is needed, brokerages can help to meet such demands.

Do you have a yacht you wish to charter? Our yacht brokerage company would love to assist you in chartering your yacht. Our brokerage specializes in yacht services. Vessel Vendor’s elite yacht brokers have a reputation for working with the top manufacturers, vendors, and professionals in the yachting industry bringing you the top level options for your needs.

Should you have any questions about chartering your yacht or if you have any general inquires to Vessel Vendor, please contact us through our website or call 561-600-5006 and we will respond as promptly as possible.