The majority of yachts offered through our website are located in Greece. This is due mainly to the fact that we know these yachts very well and we can send information pertaining to the vessels. As a result we offer you the best visual record possible for the boat of your interest. By that you avoid unnecessary expenses in order to visit and survey the yacht.
Most people want to buy a brand new boat and rationalize it by saying, “Well, I don’t want to fool around with all the breakdowns and problems involved with a used boat. I want a new one that’s free of all that hassle.” You know the argument, we’ve all used it. Boaters who’ve had the experience of fitting out a new yacht know that they’re hardly trouble free.
And the cost? Financing a new boat purchase over ten, twelve or fifteen years is hardly good economics when the average period of ownership is probably less than six years. What could give you more of a sinking feeling than to have to write a check to the bank when the time comes to sell because you owe more than its worth? That can really take the pleasure out of boating.
The point is that more and more yachtsmen are discovering that there are really great values to be had in used boats, particularly older ones that have reached the point where the shine is gone, the style is no longer the latest, the engines are blowing smoke and the interior is a bit more than just worn. The one great advantage of considering purchasing and refurbishing an older yacht is the tremendous differential in the cost of new.
A new boat that sells for 250000 euro might have a resale value of 100000 Euro ten years later. That’s a whopping difference of 150000 Euro, so it doesn’t take much imagination to see what could be done in the way of refurbishment with even half that amount.
When evaluating a budget for a used boat, think of the price in terms of what a new boat costs, for this puts the matter of cost in its proper perspective. Since the choice is between new and used, the difference in cost must be a factor in assessing what it will cost to own a used boat. There’s a reason why that 15 years old boat is selling for 90000 Euro and not 200000 Euro: its called wear and tear. It has 110000 Euro worth of lost value, a sizable part of which would be required to bring it back to tiptop shape.
The next important consideration is how much to budget for refurbishment. The biggest mistake that most used boat buyers make is to grossly underestimate the cost of putting things in order, even if they don’t plan to do all that much. A common example is someone who buys a fifteen years old 44 feet sailing cruiser for 90000 Euro and then thinks it only needs another 9000 euro to get it in shape. This, for a boat with a replacement cost of 200000 Euro. Obviously, 9000 is not realistic at all, and if that’s all he can afford, he can’t really afford the boat anyway.
From experience we know that even late model boats require a certain percentage of sale price to repair defects, replace canvas, upholstery, carpet, upgrade electronics and all the other things that new owners usually attend to. This depends on size and value, but for a six-year-old well kept yacht could typically be a 8-10% of the price. After six years, that amount rises steadily, mainly because of increasing deferred maintenance, meaning wear and tear that stays worn and torn. By the time the vessel is 12 years old, deferred maintenance reaches the point where the entire boat may need refurbishing, and we’re no longer talking about 10% but 20% of the sale price, even more.
A very good rule of thumb for estimating refurbishing costs is to allow at least 20-30% of the purchase price for a boat in average condition and up to 50%, or more, for one in poor condition. These numbers assume that most the expenses go to engine, machinery, various systems and interiors. However, more extensive refits require even more (such as repainting and major interior renovations or new equipment additions) and are not beyond the bounds of being a reasonable investment. Ultimately, it all depends on the replacement cost, purchase price and how far you want to go toward making the yacht look and function like new.
That’s the reason why buying an older vessel and only allotting a 10% repair budget is a mistake. In that case, you own a boat that’s still on the downward slide and your deferred maintenance and costs only continue to escalate as things break down and deteriorate at an ever-increasing rate. And if you can’t afford it, this is not an enviable position to be in. It can really take the pleasure out of boating. If you’re looking at a larger boat than you would ordinarily consider, just because it is older and the price is lower, you need to re- consider of something smaller.
Many refits got off-track because the owner became distracted with luxurious interiors and fancy gizmos while neglecting a pair of worn out engines or other important systems. When an engine goes “bang” the owner comes up short because he spent all his money elsewhere. For this reason it is imperative to schedule all work by priority. For example, restoring major systems to reliability must always come first, before considering cosmetics and amenities.
A last word about budgeting: if your budget is tight, allow a part of your total budget for the unexpected. No matter how well you plan, there will always be an unexpected problem. If no problems arise, you can buy the electric winch will make your life easier on board or even Valentino signed plates for the galley.
Get good advice, hire the right people, plan carefully and the end result will be a project customized to your own liking and one which you can be proud of.
Don’t make the mistake of thinking of cost in terms of what resale value will be years later. You don’t recover your costs with a new boat, and you won’t recover them with a refurbished used one either. While you’ll probably get more than you paid, you won’t take a lot. What you spend is not an investment, but for your own pleasure.
As a broker I see numerous refurbishing projects, the majority of which lavish money on aesthetics but ignoring fundamentals. But surveyors are not impressed with fancy leather, Travertine marble and designer furnishings. They consider in structures and basic systems. Know that when it comes time to sell, your project will be largely judged by fundamentals, not aesthetics. If you shortcut the quality of basic systems, it will adversely affect the resale value.
Surveyors and knowledgeable buyers will be more impressed with good quality and attention to detail on basic systems such as machinery, plumbing and wiring than designer carpet and sculptured glass. It tells the observer the seller knew what he was doing and put his money where it counted most, on systems that are sound and reliable.
Approached with knowledge and understanding projects can be fun and rewarding. Projects that are fully estimated, adequately funded, and with sufficient time allotted, usually move ahead smoothly and without major hassles. You’ll end up with a nearly new boat for far less than the cost of a new one, and one which will be a hot item on the resale market.
- First of all, it is recommended to sign a Memorandum of Agreement (MoA) with the Seller(s) of the yacht. In this Agreement will be the terms of the purchase (particulars of the specific yacht, price, place of delivery, equipment, repairs, etc), in order for the Buyer to assure the time needed to conduct the necessary inspection (Condition Survey).
- Once you have both (Seller – Buyer) signed the MoA, a deposit will be transferred to the Broker’s (YD Yachts) bank account (usually 10% of the purchase price). The Broker will be acting as the Trustee for both parties (Seller and Buyer) till the conclusion of the sale. YD Yachts will pay it to the Seller after the completion of the Condition Survey and the acceptance of the Vessel, in written, from the Buyer.
- Afterwards, you should have the yacht inspected by a Surveyor of you choice in the water and ashore. All related expenses for the survey are paid by the Buyer prior to the realization of the survey. In our web site you will find a list of independent Surveyors.
- After the survey is completed, the Buyer will go over the report and discuss possible deficiencies with the Surveyor and the Broker. The Buyer has three options: a) He/she can take the boat As-Is. b) He/she can reject the boat and have his deposit returned or, c) He/she can ask for either the seller to correct the deficiencies or make a reasonable and sufficient reduction in the Sales Price to enable the Buyer to make good the same, after the completion of the sale.
- The payment of the balance purchase money will be paid by the Buyer to the Seller, provided that the Trustee (or The Solicitor) has received, by the Seller, in original, all the documentation, required by the Greek Registry, for the transfer of the boat to the Buyer free of debts and encumbrances of any nature whatsoever.The above steps are the result of long time experience in the yacht brokerage. The specific steps will insure the smooth and legal purchase of your yacht.
The procedure for the deletion of the boat from the Greek Flag and the transfer of the ownership to the Buyer takes about 20 to 25 working days, especially if the VAT must be paid.It is always the responsibility of the Buyer to obtain new registration.
For the purchase a yacht under Greek Flag with professional license (charter yacht), it is recommended to have a solicitor for checking the status of the boat in the books of the Greek Ships’ Registry, (before and on the date of the application for the Deletion), for monitoring all the purchase procedure, including the payment of the corresponding V.A.T (if due). Also, in order to verify the documentation of the Seller before the date and on the date of the application for the Deletion from the Greek Registry and to obtain the translation of all the Official Certificates and documents from the Greek Authorities regarding the purchase, transfer and taxation of the Vessel. YD Yachts, will assure you of the lowest fees possible!
A Greek Flagged boat can sail away only when is deleted from the Greek Registry and the new owner is holding:
-Boat registration document (original)
-Personal identification papers (passport, Id)
-Sailing certificate/qualifications (original)
-Power of Attorney (original) signed by the owner and stamped by a notary public allowing to the quests the use of the yacht in the Greek waters (if the user is not the owner)
a)Transit Log for none EU flagged boats issued by the Customs
b)Permission to Sail the Greek Waters, for all private EU flagged boats issued by the Port Police.
The taxation laws of Greece are structured in such a way, that all private use yachts under Greek Flag, over 10 m, are taxed a rather high luxury tax. This luxury tax is based on the length of the boat, regardless of the age.
On the other hand, as far as professional boats are concerned, there is no luxury taxation and in addition the VAT is exempt. The revenue from the use of the professional boat (charter boats) is also tax-free (this is an incentive to promote the tourist industry in Greece). This explains the existence of many professional boats in Greece although many of them are not used really for charter.
All boats under Greek Flag have an “Official Registration, Class A “. This Registry allows for an easy check to whether the yacht has a mortgage and other legal bindings or restrictions. Either way, a yacht under Greek Registry cannot be Deleted from the Greek Registration Record without the specific procedure required. Therefore, reassuring that the boat is free from all encumbrances, maritime liens and any other bindings.
This way, the purchase of a boat under Greek Registry is totally legitimate and the Buyer can feel 100% safe.
The condition is not the only parameter that will guide the prospective buyer to pursue to the purchase of a specific boat. The VAT – whether it is paid or not – is a matter the prospective customer should take into serious consideration. The amount needed for the payment of VAT is frequently the main factor in order the buyer to express his interest to a specific boat or to reject it without even visiting the boat to check its condition.
As regards a boat with Greek flag used for chartering, VAT should be paid when sold to a private individual, EU resident, for personal use. The payment takes place in Greece, in the internal revenue Service (tax office) the boat belongs. No revenue Service (tax office) in Greece has any list with boat values in order brokers such us to be able to inform with confidence the perspective buyer about the amount required for the VAT payment. For some boats we are able to inform you with confidence and precisely enough for the amount of VAT payment – we are going to explain the reasons of that via e-mail. Unfortunately, most of boats are not included in this category. Revenue service (tax office) uses lists with asking prices provided from brokers in their sites in order to evaluate the market value of the boats. As a result, most of times, we face an especially high evaluation of the value for boats that are old and have been used for chartering.
You can certainly understand that it is not wise to start disputing with the revenue Service (tax office) as this kind of disputes usually does not bring the desirable result but the exact opposite. Then, the seller and we start a procedure in order to persuade the tax revenue Service (tax office) to make the appropriate devaluation of the boat according to the build year and its use. In this point we should mention – in order to be totally honest – that this negotiation can or cannot conclude to a devaluation.
After finishing the VAT payment procedure, the tax office provides us a receipt for VAT payment for the specific boat. In our turn, we give this receipt for payment to the buyer along with the official translation in English.
If you are running a European yacht charter company you can purchase any boat under Greek Flag with status “VAT exempt”.
In some cases like:
- The boat you selected is rather new and the VAT is still very high.
- The boat is expensive and the amount necessary for the payment of the VAT as well.
- You will keep the boat in Greece for chartering (even lightly).
- You will sail with the boat out of EU waters for long (more than 2-3 years).
- The final price, VAT included, is over your budget.it is worthy to take in serious consideration the possibility to purchase the boat “VAT exempt” by establishing of a yacht charter company in your country in order to present the necessary documents to the Greek Tax Authorities and buy a boat exempted of VAT.
If you decide that, our lawyers will assist you – at the lowest cost possible-to produce the necessary documents for this purpose. In addition, we can help you by providing all the necessary documents so, when needed -if needed- to pay VAT for the boat in the future, you will pay an amount significantly smaller than the one you should have paid in Greece. As you can easily understand, all the above obtain more significance as the value of the boat augments.What about none EU Buyers?
Buyers, residents of countries outside the European Union can buy any boat without having to worry about the VAT. In their case, the only expense is the cost for exporting the boat from the EU plus some expenses for the deletion from the Greek Ship’s Registry and for the transfer of the ownership to the Buyer, amounts not bigger than 1600€.