Do yacht owners make money chartering?

As a yacht owner, you can definitely make a profit by renting your yacht and offsetting your costs. The net benefits of renting a yacht are a distant dream for most, but not impossible for some. Having a company that manages your rental within a thriving network of boaters will help you maximize the return on your investment. There are some brands, models and routes that are much more popular, and it's worth knowing the best way to invest right from the start because, unlike the trend with most types of cars or boats, not all yachts start to depreciate immediately.

Renting your boat for others to use is the most common way to earn income with your boat. The charter market has long been a thriving industry, and charterers are willing to pay a good amount of money for the private use of a boat, whether it's a luxury yacht, a weekend sailboat, or a one-day fishing boat. In fact, the COVID-19 pandemic has made this sector grow tremendously, as people seek socially distanced vacations to be able to enjoy with small groups of family and friends. As an alternative to selling your boat at a traditional rental agency, boat rental plans offer the option of leasing your boat to an agency in exchange for guaranteed annual income of between 8 and 9% for a given period of years (usually five).

Most unmanned boat rentals take place on monohulls and sailing catamarans, although there is a growing demand for more motor yachts. Smarter Charter for yacht and aircraft owners is an improved patented management protocol that offers significant competitive advantages to owners of yachts and chartered aircraft to significantly reduce their ownership and operating costs while maximizing positive cash flow and after-tax net benefits. Some companies try to solve all of the above problems and offer options such as selling the boat without charging a commission if you buy them a new boat (Dream Yacht offers that option). We'll tell you everything you need to know about the reality of rental yacht ownership, even what rental companies won't necessarily volunteer to tell you.

As the name suggests, this is the easiest way to charter a yacht, since it does not require the supply of crew or the supply offer. Ultimately, it is the purchase price (the price of the vessel) that is crucial, but variable and fixed costs are what can determine if the operation (your yacht rental business) is profitable or not. The above-mentioned relationship between the purchase price, rental rates and operating costs cannot be applied to all investments made in yachts that are in the rental market. There's simply no way an owner can reimburse their capital repayments based on freight; that's not what the charter business is all about.

Therefore, it is of utmost importance to plan your investment and position your offer as thoroughly as possible and with the most up-to-date information on current trends in yacht rental prices (see an example of previous data on the next slide). Having a custom-built yacht for chartering or, in short, to generate profits, is the best way to use a yacht rental solely for investment purposes. They don't have any inventory costs for their rental company, since the yacht owner pays that bill. Yacht rental management is a strategy not only to maintain your yacht, but also to pay less in the long run when it comes to the costs of docking, maintenance, insurance and other operating expenses for your yacht.

There are many dynamic factors involved in managing a successful yacht for a rental operation, and one of the main things you need to consider is the quality of the service you provide to your customers. Smaller companies are much more suitable for owners who want to own a particular type of boat (TMM, for example, keeps almost any ship you want in their fleet) with customized features, such as sailing a lot, maybe going out on your boat 2 months in a row and being very involved with your boat. Most sailing or investment professionals don't even seem to seriously consider yacht rental and net return after taxes. .


Pamela Taschereau
Pamela Taschereau

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