Yacht Economics

A yacht is in fact any type of vessel, other than a dinghy, propelled by sail, power or both and used for pleasure cruising or racing.

Depending more on your budget, and less on your pleasure, you can determine what kind of yacht you can afford. A yacht is an expensive toy, and not everybody is made to possess one. (You know, if I want to sell a boat to anybody, I can pretend the contrary, and be quite believable). If you buy something with less than € 20,000 the thing you bought is not a yacht, is something else. A masted dinghy is cheaper. The rough wood price is between $ 500 and $ 1,500 per cubic meter.

Some skills are required to maneuver a yacht, some papers and certificates, brevets and licenses, exams passed and so on, even if someone, a former client, told me that in France you are allowed a lot or funny things if you keep some limits, to have one means a lot more responsibility than having a car. In Turkey for sample, the Coast Guard (Sahil Güvenlik) is prosecuting everybody if they don’t present the required papers, I mean the dinghy owners as well. 

                                  (courtesy of Coast Guard site, Turkey)

Formed in 1982 as the maritime wing of the gendarmerie, the coast guard is now separate but also reports to the Ministry of Interior. The coast guard is responsible for maintaining the security of the coast and territorial waters, for conducting missions to protect its Exclusive Economic Zone in the Aegean--the boundaries of which are under dispute with Greece--for search-and-air-rescue operations, and for protecting the marine environment.

Sometimes they are right, most of the time, they aren’t. They allow the daytrip boats to carry tens of drunken tourists through the bays, not serviced by more than two or three people at the same time, only if the boat owner presents the crew’s papers and the boat assurance with the fire department approval. Don’t think I have a sting against Turkey, on the contrary, Turkey is a perfect place to buy a yacht (almost the yacht buying heaven, another exaggeration from my part and not only), and less regulations to register one and more…

In Turkey you can find the boat of your dreams, with a real price. This “real” price is closer to the building materials value, adding the manufacturing value.

A yacht is going to cost you after you buy it, as well. Try to find the price of Marina’s rentals per week, and you may have a idea then, of what to do investing in a yacht.    

The Rules

After today, I'm going to take every point in the previous two posts, Purchasing a Yacht, Part one and Two, and extend a little what is all about, seriously, meaning the art of purchasing boats and the beauty of it. All, stuffed with some of my experience, too.

I remember having a beer and a sandwich on a small terrace cafeteria in Piraeus, exactly on the steep street in front of one of the numerous entrances to Aya Yorgo's dwarfs. At my table came a man in his sixties, asking somehow permission to sit. I usually don't socialize with strangers, but there were some problems at my ship and thinking of a future plan of action, nodded to the old man indifferently. There were only two tables, it was a very small buffet which served fried anchovies with onion, toasted sandwiches, Amstel beer and some sodas. Nothing else to eat. And yes, coffee. The fake Turkish one, named "Greek Coffee" there, and the universal soluble Ness. It was perfect just for a quick snack before entering the port.
 "You have a golden watch, you must be very rich, then" said the guy.
I thought he wanted something to eat, and asked him if he fancied some fried fish.
"Oh no, young man, thank you. I'll pay for my beer and fish. I was just curious of your business, nothing more, that's the reason I desired to sit at your table."
I told him about my problems, that I was Second Engineer on a small vegetable oil tanker at the time, but I was thinking to start on my own with the first opportunity showing.
He, with the plastic watch, was a shipowner now, after ten years of ship broking. He told me the story of his life. How and with what he started. He was still very modest, even if as every Greek with some money in the banks had home his luxurious Mercedes Benz. Not being quite a tax offender, he had his ships under rented flags, oversea in Panama. It was usual practice.
I've learned something then. If you don't risk to leave your well comfortable "job", you'll never gonna be in a judging position.

courtesy of tripadvisor.in

                                    
I'm not judging still, even not being employed anymore. Society needs working people in key positions. Greeks were buying junks, they painted and repaired the engines with third world personnel , "worked" the ships another year with third world crews and sold them four - fives times more. Money for starters? From banks or VC's.

So, if you find yourself in the old guy's position, you may allow a Mercedes at home and a Ferretti in the nearest marina. Don't be shy, nobody will know unless you wanted them to know!

Purchasing a Yacht - Part Two

7.     Is it better to try the boat before buying?

This stupid question, “top” question, I found on the net recently, mingled with the process of buying a yacht. You, what do you think? Is it better or not? In some beliefs, especially in the Muslim world, it is not recommended for the groom to try the wife to be, before wedding. One might be shut, or open up if so. But a yacht? You have to trip it as long a distance as you can buy (metaphorically speaking) from the “broker”. A free tip. It’s strongly advised to check the boat without other clients on it. I’ll explain later.

8.     Are the brand names important or not, when buying a yacht?

Only if you are in the “over 10 Mil” Category. Depends on what you’re ready to throw the money on: the label, or the guarantee coming with the label. Anyway, everything is limited.

9.     How to find a good crew?

One can find a good crew by searching it. There are forums, there are specialized sites, you can web chatting them and if you like them, you can call them. Referrals work too, but you need to test them. If they can figure what is what, they have potential. Why? The real good crew, is already employed for Johnny Depp or Mr. Abramovich. Of course I'm joking, there are a few left for you to pick up.

10.     Where to keep the yacht after I bought it?

The question must be reformulated like this: “Where am I going to keep a yacht if I’m going to buy one?” It is a good question. Some are saying that you'll be fighting the crowds in the Caribbean each winter and the Mediterranean every summer. I say, go in Turkey. I’ll show you why and how.

11.     What costs me to run the yacht?

Depends on how big it is, depends on the type, if it’s mono-hull or a catamaran, and depends on the category you are a part of. Can be up to even a Million Euros nowadays, as some “broker” advised recently on an American site. Depends, I repeat.

12.      Is it better to charter my yacht or not?

If you got the money Ma'am, Sir, you don’t have to rent it, otherwise, you can shoot some extra for maintenance and crew salaries if you’re chartering the boat. Don’t be shy with friends either. Prices depends on your nerve more, on the quality less.

13.      How much can be the insurance and if it is necessary?

One can hope that if he’s not insuring the house, maybe he got lucky and no fire or earthquake will destroy it, no thief will empty the safe and take the other valuables. Maybe depends on the neighborhood to insure or not, a house.

With a yacht, is different. It has to be insured, there is the sea, there are a lot of other factors, you scratch it, immediately sue the insurance company to pay, and so on. Later about insurance and amount.

Purchasing a Yacht - Part One

Following a dream or a social requirement if you don’t suffer of seasickness, may be mesmerizing, but can turn into a very unpleasant experience, due to the complex process of mixing brokers and owners, sometimes of boat builders, or the future maintenance and crew.

If you have hundreds of questions about it, arrange a priority for the following ones. I’m trying to answer them based upon my own experience and the one of a lot of other people in the yacht business.

1.     What kind of yacht would I like, a sailing one or a motor-yacht?

That depends of what kind a person you are, and the purpose of the boat you want to buy. If you are the dynamic type, you’ll prefer a sailing yacht, speedy and ecological as it is, thrilling as any adventure one can imagine at sea. Dynamic or not, if you can afford luxury at sea, want to feel a superstar, the power yacht or motor-yacht will be the choice.

2.     What PRICE are you ready to pay for the desired yacht?

On that answer can depend as well, the type of yacht you’re going to have, sailing or motor-yacht.

3.     How big a yacht do you desire?

It’s simple. If you got enough, the length may be 100-150 ft. Enough means over 10 Million €. Of course, there are boats for every budget (almost). One can buy with € 100,000 something similar with a yacht, but generically speaking it’ll be just another boat, longer than 10 ft., of course. 

4.     What material will be your yacht built of?

Recommended is GRP, of course, this meaning Glass-Reinforced Plastic, or the glass fiber, but as good as it, and cheaper, could be the wooden boats, eventually with an epoxy coating, making them look brilliant. There are other choices as well, of course, Steel,  Aluminum, Ferro-Cement, Composite.

5.     Should my yacht be new or second hand?

Just my advice, be your first yacht a second hand one, not a new one. With reliable references of reliability, it is proven that the one used once at the passing of Atlantic, can be used again. If you don’t trust it but you bought it as an impossible to refuse bargain or offer, who knows, don’t do the trip over the ocean yourself, send your mother in law, or whoever, a nasty “friend” who’s courting your mistress to avidly.

Joke aside, it seems to be obvious a matter of budget first, after that the rest. Newer doesn’t mean better. 

 

6.     How can I find a good broker?

Some say “referrals”; I say instinct and referrals. Seems natural to look the guy in the eye and smell the rat if it’s there. If the boat is there too, we’ll talk about it in a next post. It’s a matter of tactics here. Shall I charge you for the precious coaching? I’m gonna think about it.

I'm not finished yet, you know, don't you? 

Buying a yacht, of course – Part 2

It’ll be funny, I’m sure, because to buy a yacht it’s not a stressing fact, as a lot of the published brokers claim, to sell one is even better. I’ll show all the view points, the boat owner’s, the buyer’s, the broker’s, the builder’s, the surveyor’s eventually. No advice from me, only suggestions some times, just because the instinct of the person you are, will prevail all.
Few categories of people will buy or build a yacht. Most of them are sea lovers, others are just investors. Some of them want to make the yacht their future home, which will be maybe not the last one they’ll buy, and certainly their experience will improve considerably with the time passing, buying the next, and the next after that.
There are the movie stars, or the business tycoons who need to express themselves better by buying a yacht, or have to close deals relaxed, by the way, I can’t think a better place then a boat, a luxury boat for such activities, especially money-getting ones, unless there is  some sea sickness involved.

courtesy of JustJared

The best way to know what boat will keep you happy and satisfied, is to live aboard one for a while and discover what works best for you. “Awhile” means even a few days, sometimes, if in a hurry, for just a day.
Many people never debate the merits of sail versus power. Powerboat people simply look at powerboats and sailors look at sailboats. Perhaps they should ponder a little. It rarely occurs to a sailor that he might be happier with a powerboat for a home.
My area of expertise is not extended to racing. I’m not going to throw opinions on America’s Cup Class boat positions or the crew members’ assisting areas, or when will the sails be let out a little at a point of “close reach”, after “away bearing” from the wind in a certain spot of Bay of Biscay.
You’ll find here some term explanations too, tips, tricks, sea regulations, definitions, suggestions for deck gear, navigation equipment, electronics, basic tools, safety equipment, galley, engine and more, matching the needs of live aboard people, leisure or business.
Brokers claim that buying a yacht is resembling buying a car. Is it? You’ll see that on your own.

Buying a yacht, of course.

What will follow is primarily a bunch of opinions on how to buy yachts or boats from Southern Europe and Turkey, mostly the last location, because they’re closer to their face value than what you may buy in Greece, or Italy.
I don’t think I’m going to advertise anyone for the moment, anyone in the boat or yacht selling business.
I want to share with the reader of this blog, my experience in the area and what one has to  do to be sure that the future deal he is thinking of, is arranged at its best.
I made a lot of connections in Turkey, with the package of know-how acquired by doing this. I met people, too many people. Some of them were good, some of them were not. On the contrary, they were not only just “not good”, or “not good enough”, they were bad, bad persons.
With the time passing, I shall  present all the  alternatives of buying, with the assistance of a yacht broker, or on your own. What I have learned by living there, I mean in Italy, France, Greece, Spain, and Turkey, is that there are a lot of so called “brokers”, very few with genuine experience on helping the potential customers, but aiming to take the last penny they can get.
There will be expert posts, based on selling boats, technical posts concerning yachts and maritime devices in general, and a lot of original creative things, about life on sea, life aboard and so on…

Have a nice time, until I’m getting things put into a proper order.

Know-how on boats

This is a beginning post to conserve my blog title, found by my dearest partner, love and IT mentor.
Very soon, the secrets of buying or selling boats, will be developed in the pages of this blog. Tips, personal opinion, technical data on living on board and many others.

Aegeean

The most important thing in this area is that if you want a boat, you’ll get it. Who claims that this was a childhood dream, has the money, but consider that is not the right time to ride the rainbow tail of his wish, is not telling the truth.
This guy never wanted a boat for him, he just imagined himself as a yachtsman, maybe a racing one, and this thought frightened him. It takes a lot of character to buy a boat to be yours, even with the pretext of buying it for the loved one, or for the sibling, “for later”, as I was told, a few times. Not one that I know, sold everything valuable, to buy a yacht and move effectively on board. This is a real step to make. But what a life he choose. From golf to golf, through the Caribbean, never to stop, never to be bored.
You believe?