20 Expensive Mistakes Yacht Buyers Make (And How To Avoid Them)

Buying a yacht is one of life’s great privileges, but it’s also where people can make one of the most expensive mistakes of their lives.

We regularly see the same patterns of thinking which lead to these mistakes, so here are 20 errors I see clients repeating, and what you should do instead.  

1.        Prioritising size over substance

This one happens more regularly than you’d think. A client will be set on purchasing a 50m yacht with a somewhat limited budget for a boat of this size.

So, they press on and purchase something maybe a little older, or from a less reputable shipyard. Once under their ownership they realise that the operational costs are a lot more than they had envisioned, or the maintenance schedule a little more hectic, or the internal volume of a new 42m is actually greater than what they have, or the flow of space is a little more sensible.

Size is a very basic requirement in yachting; form, volume and function should really be a priority over the length of the yacht, which can be somewhat arbitrary.

2.        Ignoring resale value

Whether you are looking to own the yacht for a couple of seasons, or the next decade, eventually it is likely you will consider selling the boat.

Brand, age, classification, style and maintenance history are all huge determinants in the resale value of the yacht.

Choosing something fully custom and highly unusual will certainly make you stand out in St Tropez, but it may also have you sat on a very illiquid asset when the time comes to offload.

3.        Underestimating operating costs

What is sometimes considered a mythical figure in yachting, is quite easy to predict if you know and understand your intended usage.

Crew numbers, berthing location and number of weeks of planned use can give your broker the context needed to come up with some fairly realistic figures.

Don’t get stung here as no one likes a nasty surprise – and there is not much nastier than a yacht which is costing double to run as you had budgeted.

4.        Choosing the wrong flag state

This is a big one to discuss with your management team beforehand, because choosing the wrong flag can have a detrimental effect on potential charter revenue, increase operational headaches and even affect resale.

Some flag states are notorious for expensive or inefficient administration, and others giving higher legal vulnerability in case of incident. Some flags are harder to insure, others are slow for surveys, name changes, charter coding and other tasks.

5.        Not understanding VAT implications

VAT-paid status is meaningless unless supported by the original invoice, a continuous chain of ownership and proof of EU presence.

There are a myriad of VAT implications to be aware of such as paying VAT when you didn’t need to, triggering VAT on arrival to the EU without using the correct scheme, losing VAT-paid status due to spending too long outside of the EU or conducting a major rebuild outside of European waters.

There’s a lot to think about so it is vital you have an experienced and trustworthy VAT expert in your corner.

6.        Going direct to shipyards without representation

I know what you’re thinking… “Of course, a broker would say this!”. But I have seen countless examples of brokers not only proving their worth with resolute mediation of conflict with the shipyard, but more importantly, strategic and sensible negotiation of the price.

More often than not clients will save money by using an experienced broker.  

Of course, shipyards are likely to suggest an owners representative isn’t necessary – but by not using one you are effectively entering into a long-term commitment (both financial and emotional), without someone in your corner fighting for your interests. Yachting is a team sport.

7.        Unrealistic expectations regarding specs

Is top speed important for you? The specifications on a yacht brochure will likely have a top speed listed for an empty yacht. Fill her with fuel, marble and booze and she is going to be moving slower.

A yachts’ range is based on perfect sea and wind conditions. Fuel consumption is shown for an ideal RPM. GT is internal volume, not weight or displacement or size.

Are you realistic about the stabilisation system, as it likely doesn’t mean the yacht will be still in any swell. This is all worth considering!

And once you understand the specs, the next step is understand who it is verifying them…

8.        Not getting an experienced surveyor

Strangely, there is no official accreditation needed to become a superyacht surveyor. This means someone can sign-off on the purchase of your EUR 60m vessel without ever having done an exam or technical training.

It is therefore imperative that you use a well-experienced and well-recommended surveyor to check over every aspect of the yacht before getting onboard yourself and finding some hidden surprises.

Choose someone who has seen it all before.

9.        Not checking shipyard warranty reputation

Sure – the shipyard may be offering you two years’ warranty on the boat, plus manufacturer’s warranty on all the secondary items onboard. But who are the brands? Do they have a website? Do they have any employees on LinkedIn? How does the communication process work?

I’ve seen shipyards with amazing owners’ apps to communicate any potential issues with the yacht after launch, and on the opposite end of the spectrum I’ve seen a phone number to an unanswered phone and in the rare occasion it’s answered, there is a big language barrier.

Make things easy for yourself AFTER purchase by ensuring this is thought about.

10.  Ignoring noise and vibration

Noise and vibration on a sea trial are not just comfort issues, they are likely to be a symptom of something more major; with the underlying cause likely to be expensive.

Shaft misalignment, structural problems, propeller damage, gearbox issues – all are indicated by excessive noise and vibration onboard.

So, ensure the sea trial is more than just a leisurely cocktail cruise. Of course, noise and vibration could just be the result of a loud boat, in which case you have to decide if you’re comfortable with that.  

11.  Buying with emotion

Superyachts are probably the last thing in the world anyone needs. So naturally there is a ton of emotion involved with stepping into ownership: family, freedom, legacy, status etc.

But by acting with pure emotion after stepping onboard one yacht at a show, you are likely to miss out on red flags with the history, specs or layout. You are also likely to negotiate differently and blind any objectivity, which, in yachting, always ends up costing.

12.  Confusing aesthetics with build quality

Say it after me – pretty boat does not equal good build. End of point.

If you want to learn more on choosing the right shipyard, check out my article on it here: https://www.charterandchase.com/post/style-fades-craftsmanship-doesn-t-choosing-the-right-shipyard

13.  Not focusing on crew

By far the biggest enjoyment factor of your yachting experience will be in the hands of your crew. Also (for most superyachts), crew will be your largest annual expense by some distance – so don’t make this a costly mistake.

Crew culture will dictate your experience, safety and the upkeep of the yacht. A good captain will protect your asset, manage your costs sensibly, make honest recommendations and much, much more. A bad captain will hide issues, overspend and ensure you have a conveyor belt of staff coming and going the vessel.

Wrong crew and you’ll never love your boat. Right crew and you’ll never want to sell it.

14.  Not budgeting for yard time

If you’re planning to list your yacht on the charter market to pay for your annual running costs, and you’re planning both Mediterranean and Caribbean cruising, then you will need to factor in some shipyard time in-between seasons to bring the boat back up to standard, fix any kinks and get her looking her best again.

If you’re working on revenue predictions from a full calendar year-round – you’re being unrealistic.

If you’re thinking about chartering your yacht and are keen to learn about potential revenues, check my article on whether a yacht can pay for itself here: https://www.charterandchase.com/post/can-a-yacht-pay-for-itself-a-broker-s-honest-guide-to-charter-income

15.  Believing “brand new” means problem-free

Yachts are metal, resin, fabric and engineering. The result of hundreds of people working thousands of hours. Naturally, things can go wrong, and quite often things go wrong within the warranty periods of new-builds. Especially fully-custom boats where the hull design, layout and manufacturing processes might be completely new.

Factor this into your timeline planning with smartly timed shipyard visits in your first years of ownership, and don't sweat when these small issues need ironing out.

16.  Ignoring draft, air draft and marina limitations

Have a marina or dock you were planning berth the yacht? Make sure you check the draft and air draft entry requirements. Don’t just obsess over the length if you are eyeing a berth with a 2.5m draft, and take note of that entry bridge height!

17.  Not planning how the yacht will actually be used

Do you eat all your dinners inside or outside? Do you relax on the top deck or in a beach club? Do you need a chase tender or happy to keep a tender onboard? Do you fish and need additional storage? Are you chartering the boat and need flexible cabin configurations?

Again, don’t get blindsided by a beautiful yacht (most of them are beautiful)! Make sure it is ticking the practicality boxes too.

18.  Believing “recently refitted” means anything without documentation

‘Recently refitted’ is one of the most abused sentences in yachting. It can mean a EUR 8m rebuild which extended the yacht by 5 metres, or some new cushions on the sundeck.

Don’t allow a cosmetic refresh to fool you into thinking the technical aspects of the yacht are like new.

Don’t also take an owner’s word for a refit if you haven’t seen invoices to confirm the work - yard invoices, engine service reports, warranty documents, class records and survey reports should all be held by the boat. Ask for them!

19.  Failing to consider global regulation

The moment you cross an international border it is likely the rules of cruising change somewhat.

VAT, sales tax and import rules are different everywhere. Charter rules vary massively and a yacht with a French charter license cannot just cruise and take guests in Greece without the required docs (and fees).

A new yacht over 24m (and >600kW engine) without a Selective Catalytic Reduction System cannot cruise in America.

Europe has very strict grey/black water discharge zones that sewage treatment systems onboard must adhere to. There’s a litany of regulation globally, so let an expert guide you on what to look for.

20.  Zero focus on brand liquidity

How quickly can your yacht be sold when you’re ready to? Brokers should have access to the data showing current and historical sales figures.

Is the average model taking over a year to sell? Is the average completion price massively reduced on the asking prices? Or is there a pent-up demand for the model?

If you’re not planning to keep the yacht for a decade or more, it is worth thinking about your exit strategy before committing. Or you could be sat on an expensive asset that is unsellable at the price you need.  

As you can see there are plenty of mistakes to make in this game. But like anything else, having the right team around you can save you time, energy, stress and a lot of money.

If you’re considering ownership in the next 12 months, I’m happy to walk you through any of these points in the context of your specific plans.

josh@charterandchase.com