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Why Are Boats So Expensive?

By Rob Bowman | Posted On Nov 29, 2021
Updated On Dec 16, 2021

Ask any seasoned boater what they love about boating and you should be prepared to take a seat, you'll be there for awhile. Boaters are very passionate about their love of being on the water and about their boat, particularly if they have customized it to their liking. Boat sales have reached amazing record highs in 2021 with no sign of slowing and many of those being first-time boat buyers.

As many new to boating have found out, buying a boat can be expensive. It's not just the cost to buy a yacht either that is daunting, but also the cost of ownership. Still, part of the allure of owning one is that it is somewhat exclusive due to its price tag.

The price of a boat is determined by many factors including the hull materials, the construction process itself, the location of the shipyard (which affects labor costs), the equipment, electronics, furniture, and of course, the engines. 

In rare cases, you can recoup the money you spent on a boat when you sell it, but this only happens in very unusual circumstances. Despite all of these financial considerations, when compared with the fun, relaxation, excitement, and all of the memories made on a boat, the decision becomes a 'no-brainer'.

"There are people that say owning a yacht is a frivolous, excessive expenditure of money that could be spend on other more worthwhile endeavors," said Peter Schmidt, founder of United Yacht Sales. "That couldn't be further from the truth! A yacht allows you to make memories you never dreamed possible. You cannot place a value on the look on your kid's face when he reels in his biggest fish or the uninterrupted time spent with your family outside of cell phone range, those moments are priceless."

 

Seller's Market

As with all products, the supply and demand of boats will affect what it costs to build, equip, ship, and sell to you. As we discussed in our yacht market update, the current conditions still point to a seller's market with the boat values increasing as much as 75% in some categories. Well known premium brands like Azimut Yachts, Benetti, Ferretti Yachts, Horizon, Ocean Alexander, or Viking Yachts will often see their resale values hold strong, particularly if they are updated and in good condition. Custom sportfishing boats like F & S Yachts, Jim Smith, and Rybovich, because of the high-quality materials and laborious construction methods, will also retain higher values.

Even with prices on the higher side, many boats are being sold before they ever even hit the market or within 30 days of becoming available. If you're new to boating sometimes booking a yacht charter can be a great way to experience the boating lifestyle without the expense of ownership and maintenance.

 

Cost Of Materials

motor yacht resin infusion process

The picture seen above is what the resin infusion process on a large motor yacht looks like. Many boat builders are now using some kind of resin infusion process to create stronger hulls that are also lighter, allowing the vessel to have a higher speed. There are several types of resin that can be used, all at various costs. Most boat builders use vinylester resin due to its heat and corrosion resistance, while epoxy resin, the most expensive choice, is often reserved for superyachts. CompositesWorld.com has been keeping up with resin availability and reported that one of the main suppliers was going to increase prices between $170 - $225 per ton, an increase on top of other recent increases in 2021. 

This cost, of course, trickles down to the shipyard, down to the dealer, and finally, down to the consumer. But can you put a price on safety when it comes to your boat? A knowledgeable, professional yacht broker can discuss with you the quality of the construction methods of the boat you're interested in and whether or not it will meet your expectations.

 

Cost Of Equipment

interior helm of a yacht

From the electronics in your console, to the captain's chair you sit in, to the air conditioning you enjoy, and to the generator that makes it all work, your yacht is far more elaborate than just the hull and engines. Each of these components from pumps, to hoses, to GPS screens has a cost and the nicer equipment you have on board, the more your boat is going to cost. High-end equipment also helps with the resale value though, should you be working with us to build your own, customized new yacht. If saving money is a concern, slightly older boats are still an excellent option for fishing, cruising, or just enjoying the ocean with your loved ones. Many boats for sale under $500k still come with navigation equipment, sufficient generators, and other necessities, they may just require a little more maintenance than a brand new or late model yacht.

In today's current conditions, the cost of new equipment has not only increased in price, but also is becoming scarce. BoatIndustry.com believes 2022 will remain unpredictable for marine industry equipment suppliers. Finding the right pre-owned yacht for sale that already has the equipment can be a suitable solution, a process that a professional yacht broker is best suited to help you with.

 

How Many Engines Do You Want?

yacht with outboard engines

Depending on the type and size of boat you want, the cost of motors has quickly become a top expense. Some center-console boats can have hundreds of thousands of dollars' worth of outboard motors on the back of their boat, propelling it to speeds of 50 knots and higher. The new Mercury Verado 600 recently was introduced and took the boating industry by storm. This 7.6 Liter V12 600HP behemoth can cost nearly $80,000 per engine. 4 of these 600HP outboards were recently added to the V46 center-console from Valhalla Boats, allowing it to reach a top speed of 75pmh and could accelerate from 0-20mph in 4.8 seconds.

But not all quality motors are so expensive. Many brand new outboards are around the $30,000 mark and come with substantial manufacturer warranties, taking the headache out of unexpected maintenance.

 

Location Matters

shipyard in taiwan

Believe it or not, the location your boat was built and the area where it's sold will impact the cost of the boat. For decades, yacht manufacturers have utilized the shipyards in Taiwan, China, Turkey, and elsewhere not just because the cost of labor is less than the United States, but there is also generational craftsmen in these areas that have devoted their lives to building boats. Major brands like Horizon, Fleming Yachts, and Dyna Yachts are built in Taiwan. While labor might be less in these destinations, the cost of shipping and commissioning these vessels also is a factor in determining the final price.

Even the location of the country you purchase your boat from can make a difference. If it's new, things like sales tax, shipping costs, and equipment availability can all play a factor in how the boat's location can affect the price. If it's used, generally fresh water boats can demand more money than boats that have been primarily used in saltwater.

 

Worth The Price Of Admission

family enjoying boating

A recent survey from Discoverboating.com found that people that boat regularly are healthier and happier than those that don't own one. Of all the people surveyed, 83% of boat owners said their health was excellent or good, with nearly 70% of those people contributing their health partly to boating. Two-thirds of the boat owners surveyed said that it has brought their family closer together. In this age of technology at our fingertips, getting outdoors and on to the water might be one of the most important things you do for yourself, and your family.

 

United Yacht Sales is a family-owned, Florida-based yacht brokerage firm that has grown to more than 200 yacht brokers worldwide. This has created the largest network of boat buyers and sellers anywhere in the industry, and the connection of all of these agents allows us to find you a boat for sale that others can't. Whether you are looking to purchase a yacht and need professional guidance on the market, or are interested in selling your existing boat, the United Yacht Sales team is here to assist you every step of the way. Give our headquarters a call at (772) 463-3131, use our Find A Broker Near Me page, or fill out our What's My Boat Worth form and we will get back to you quickly.

 

Enjoy these articles about the current market and listing/selling your boat!