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Does it Pay to Become a Charter Boat Owner?

By Leah Kaiz

If you are already familiar with the ins and outs of chartering,  it may be time to entertain the idea of becoming a charter boat owner yourself. Most people who have been out on charter boats don’t realize that the majority of the boats in a charter fleet are actually owned by individuals and not by the charter company.

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Who owns those charter boats, the charter company or individuals just like you? You might be surprised at the answer.

Similar to a Timeshare

Owning a charter boat is different from owning your own boat, or just simply taking a one-week vacation on a charter. If you have multiple weeks per year to take off on adventures it may be more cost-effective to own a boat in the fleet. The ownership programs are similar to a timeshare and come with similar benefits. Rather than taking on all the costs of owning your own individual boat, the unique proposition of owning a charter boat eliminates or at least defers those expenses, for up to five years—while allowing you to take off for extended trips to destinations like Turkey, Tahiti, or the French Riviera, among others.

In a charter program like The Moorings or Sunsail, you select a boat from numerous models of monohulls and catamarans in their fleet. You contract to buy a brand new boat and put down a payment of between 20 and 25 percent. The boat is then placed at a charter base, and the company takes care of the rental management, boat maintenance, and slip fees for the next five years. In turn you collect a check each month that generally covers the mortgage on the boat, and possibly a few hundred dollars more.

Income Options

Some charter companies guarantee a monthly income whether your boat is chartered or not. Each charter company runs their programs a little bit differently, so it’s important to do your research before settling on one. On average, a charter boat sees about 19 weeks a year of use and the rest of the time it sits at the charter base. As an owner, you also receive up to 12 weeks per year that you can use in the charter program. Many companies own multiple bases around the world and usually have a swap system in place, just like many timeshares do, where you can charter at any of their destinations regardless of where your boat is based.

If you don’t have the kind of lifestyle that allows you to use all your charter time per year you can give it away to friends and family if you're feeling generous, or sell it and bank more profits off your charter boat each year. You can either have the charter company sell your extra weeks, or you can sell them for market value to people you may know. If you’re feeling very sales savvy you can sell your weeks through sites like Craigslist or eBay and collect the full profit yourself—but make sure you get the money up front.

What's different from a Timeshare

Charter boat ownership differs from the timeshare model in that you actually own the boat, not just a few weeks of time on it. Once you hit the five-year mark of ownership the boat is phased out of the fleet. At this point you have several options. You can either sell the boat, payoff the mortgage, and take the money and run. Or, as many charter owners do, you can sell the boat, reinvest the profits into a new one, and start the whole process over again. Many of the charter companies also have their own boat brokers that will list and sell your boat for you. But if you have dreams of sailing off into your retirement, you can take your boat—now with a huge chunk of the mortgage paid off and five years of cruising experience under your belt—and start cruising.

Leah Kaiz, a former sailboat captain, is also a PADI dive instructor and an avid traveler. Not only has she sailed all over the Caribbean on education vessels and worked in charter, she has also traveled around the world on various adventures. She currently runs her own marketing company on land,  Blue Gypsy Inc., and writes on a variety of topics for her diverse clientele. Her future plans include buying a catamaran and sailing around the world.

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