A Life on the Ocean Wave
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During the last decade, the yacht chartering market grew in demand, with clients booking charters almost a year in advance and owners of sought after vessels dictating their own prices.
Not surprisingly, however, 2008-9 saw a downturn, with an adjustment in favour of the charterer suddenly making it an attractive proposition. Last year, the charter market suffered a 40 percent decline in bookings and, so far this year, the yachts which originally charged premiums are having to make adjustments to secure charters. |
So why not consider a yacht charter over renting a villa or staying at a superior hotel? It’s the one way to gain some peace and quiet, yet visit places and avoid the crowds. Before you start to worry – the yacht will come with a crew!
Whilst the newer yachts are most popular, the owners of slightly older yachts are more flexible with their pricing and that’s where the opportunity arises. Many of these yachts have had regular refits and can internally appear as youthful as their younger contemporaries. Regular styling changes in boat design are made to encourage buyers – but from a charterer’s perspective, so what?
However, you will need to be aware of the dangers that may lie ahead:
- Misrepresentation – is the ‘owner’ really the owner?
- Overselling – is the vessel all that it appears in the brochure?
- Fraud and scams – who is getting your money, and is your deposit secure?
- Financial instability – is the owner about to disappear in a puff of bankruptcy?
We have advised on the marine sector from a number of perspectives and charter should be a first step for anyone even contemplating ownership in the future. It is essential to use a good independent broker and ensure they negotiate an aggressive deal for you. In some instances, you may secure reductions of between 25 and 30 percent on quoted prices. Suddenly yacht charter comes within your budget, especially if shared amongst family and friends.
The global economic downturn has hit sales, so it is increasingly important for owners to charter their yachts to sustain ownership. The industry is keen to see a recovery in the charter market in order to generate new owners. Therefore, expect to see many more yachts to choose from this summer at increasingly keen rates.
Whether you are considering the south of France, the Italian Riviera running down to Sicily, including Corsica and Sardinia, the Adriatic, Ionian or Aegean Seas, there has probably never been a better time to charter!
The process for booking a yacht is very simple. A broker will require your preferred location, guest numbers and the required dates, and will then send you full details of all suitable yachts.
Charter rates are quoted as weekly prices, covering the hire of the yacht and all associated crew costs. Additional expenses for the fuel, food, drinks and harbour fees are included in a 30 percent charge based on the charter rate – this is termed the Advanced Provisioning Allowance, or “APA”.
After you have made a short list, the broker will start the negotiation process. Once the fee has been agreed, they issue a charter contract. At that stage, let us review it to ensure it covers the usual provisions.
In most cases, a deposit of 50 percent of the total charter fee is payable on signing the Charter Agreement, with the remaining 50 percent, plus the APA, due one month before the beginning of your charter. Having to pay upfront means it is important to use a reputable broker and get us to check the terms carefully.
A good charter broker should always be on hand to lend assistance, from booking restaurants in advance of the charter to arranging flights and personal transport for the client and their guests.
Moreover, charter provides a real alternative to either outright or fractional ownership and should always be a first step before even contemplating ownership, just to make sure it is right for you.
Some final pointers
- The majority of yachts available for charter sleep up to 12 guests in 6 cabins.
- Chose your location and required dates for the charter.
- Confirm the guest numbers.
- Make sure you get a comprehensive list of available yachts, including the specification of the yacht, pictures and, once shortlisted, details of the crew.
- Ask for hard-backed brochures.
- Shortlist at least three yachts in order to assist the broker in negotiating the rate.
- Check the charter rate quoted is for the hire of the yacht under the terms laid out by the Mediterranean Yacht Brokers Association (MYBA).
- Ensure we review the documentation for you before you commit to the charter.
For any further information on chartering or fractional/outright ownership, please contact Jonathan Silverman on +44 (0)20 7749 2700 or jtrs@silvermansherliker.co.uk. |
