I believe 2021 is going to an exceptionally challenging year for boat buyers’ and more of a sellers’ market than a buyers one. Why, first we have to take a look at 2020 and how we got here.
What an incredible year 2020 was, in so many ways! With the Covid virus dominating all aspects of life virtually all over the world, yachting had to take something of a back seat though many if not most people managed to get something of a summer out on the water.
Back in March & April we were all in a state of shock and uncertainty with the impact of the Virus. Marinas were closed, yacht movements almost completely restricted, let alone international travel banned for almost everyone.
Many sellers and brokers experienced buyers backing out of deals (often under force majeure) due to the Virus. I for one had an excellent deal under contract only for the buyer to pull out as his business was very quickly put under threat.
The next few months very tough with uncertainty but a slow opening of yachting destinations, though mostly for “locals” i.e. people with their boat at least on the same continent if not same country.
Yachting was seen as safe activity virus wise and some quick rules and regulation saw more and more boats coming out onto the water. I spent quite a lot of time in Sardinia this summer and it was noticeably quieter but for sure plenty of yachts were out.
By August, everything changed. People were desperate to be out on yachts and were looking to extend their season into October and beyond.
For one of our listings, a 35 metre motor yacht, we went from no activity at all to quickly having the yacht under contract for sale with continual enquiries. I have absolutely no doubt that we could have sold this yacht 7 or 8 times over in August and September.
The reason is that quality stock, yachts in turn key order, were in short supply and people wanted to enjoy the rest of the season whilst having a great yacht for the coming years. The “bad” yachts were left unsold and many a buyer left unfulfilled.
This kept prices relatively high and I am certain that due to the pressure of signing a quick deal a number of yachts were purchased at an inflated price.
So what can we expect in 2021? For me, its going to be quite challenging for buyers. The logic tells us that a lot of people in business are going to be facing problems as their companies struggle in the tough economic environment. While there are plenty of examples of this, we are not seeing a flood of new yachts coming into the market for sale. Perhaps this could happen in the spring?
We are left with a relatively low amount of high quality stock and among those are plenty of owners in no apparent rush to let their yachts go. This makes it very challenging for a buyer and I would strongly advise that your broker visits and inspects every potential yacht on your shortlist and carries out as much of a mini-survey as possible before you part with money under a formal deal.
Things can change very quickly of course as we’ll see what happens in the new year when activity picks up again in late January. If you are interested to search for a new yacht and would like to know how we work, click here for more details.
Lastly, I love every aspect of yachting but am particularly passionate about sailing yachts (I am in the process of changing my own yacht!). But can someone please tell me where all the big sailing yacht clients have gone?? What can we do to get them back?