The economics of renting out boats

[FantomOffshore]

A common pastime on vacations to sunny destination is for me and my friends to rent a boat and float around with an ample supply of booze. It always had me thinking, what are the economics of renting out a boat on a website like SamBoat?

For example, buying a boat like this one: 2018 Jeanneau Merry Fisher 695, KATS Nederland - boats.com sets you back EUR 52.500. You would be able to rent this one for like $500 per day. Given you rent it out for 60 days a year, that would already net you $30k, 60 days a year is not unthinkable. Then there are of course costs of insurance and replacements that will be expensive.

Is there anyone here that has explored this niche? Owning a small boat while making money at the same time seems like a dream.

 

[JohnnyDoe]

At this level it is mostly like a car rental business, the economics and reasons behind it can be very articulated.
It’s different when you talk of larger yachts/super yachts (>100 ft)/mega yachts.

a plane charter business would be way more profitable

 

[FantomOffshore]

Interesting, I will definitely look into this further. Given that you are in proximity to a place where there is ample tourism and beautiful water, the ROI seems quite nice. Just the risk of drunk tourists destroying the boat seems like something that should be taken into account.

a plane charter business would be way more profitable

What kind of planes are we talking about here? Private jets?

 

[JohnnyDoe]

What kind of planes are we talking about here? Private jets?

pistons, turboprops, jets of any size. There is demand for everything

 

[Zaiga]

pistons, turboprops, jets of any size. There is demand for everything

Really? And how is the ROI do you have experience here?

 

[JohnnyDoe]

Really? And how is the ROI do you have experience here?

I don’t have precise numbers but I know the owners of airgo.de started small and did very well over the years. Warren Buffett owns NetJets (hugely overpriced service). So you can definitely make a profit in this business. Whereas I have never heard of anyone making money out of yacht ownership.

 

[troubled soul]

I believe making money is very subjective ..Sometime "Luck" works......As example Imagine You order $100 million yacht...At the day of delivery ,You can find some impatient Billionaire Who can pay $500 Million for that super yacht. as Super yacht takes years in making .......Same as in rental business Some people can rent your yacht for months....sometime You do not get any renter....I believe whole Yacht business is very risky...even making yacht is very risky business...

 

[Zaiga]

I don’t have precise numbers but I know the owners of airgo.de started small and did very well over the years. Warren Buffett owns NetJets (hugely overpriced service). So you can definitely make a profit in this business. Whereas I have never heard of anyone making money out of yacht ownership.

Thank you for the input! Always intersting to hear.
Do you know how the state monitors the property of a person? For example this person aquires a plane (small cessna) and starts renting it out.
Will there be questions how/where did the person get it in the first place and if yes, how does the state knows it. Like at which moment usually does the control occurs?

I believe making money is very subjective ..Sometime "Luck" works......As example Imagine You order $100 million yacht...At the day of delivery ,You can find some impatient Billionaire Who can pay $500 Million for that super yacht. as Super yacht takes years in making .......Same as in rental business Some people can rent your yacht for months....sometime You do not get any renter....I believe whole Yacht business is very risky...even making yacht is very risky business...

Thank you for the input!

 

[JohnnyDoe]

Thank you for the input! Always intersting to hear.
Do you know how the state monitors the property of a person? For example this person aquires a plane (small cessna) and starts renting it out.
Will there be questions how/where did the person get it in the first place and if yes, how does the state knows it. Like at which moment usually does the control occurs?

Aircrafts are usually owned by companies, and for the purposes of privacy this remains a good use of offshore jurisdictions. If the funds are moved properly, there is no way for anyone to know about the aircraft and connect it with the person.
But renting out a plane is not like Airbnb. Best thing to do is to discuss with an existing operator and work out a partnership.

 

[Zaiga]

Aircrafts are usually owned by companies, and for the purposes of privacy this remains a good use of offshore jurisdictions. If the funds are moved properly, there is no way for anyone to know about the aircraft and connect it with the person.
But renting out a plane is not like Airbnb. Best thing to do is to discuss with an existing operator and work out a partnership.

Thank you for the input! Can you give an example which jurisdictions are usually used and how the plane is "moved" there?
Is it simply bought by a offshore company? And how does the offshore company gets the money?

Thank you!

 

[JohnnyDoe]

Thank you for the input! Can you give an example which jurisdictions are usually used and how the plane is "moved" there?
Is it simply bought by a offshore company? And how does the offshore company gets the money?

Thank you!

There are many ways to do that, often involving some kind of financing. You should better talk to an aircraft broker or operator to discuss the details, there is no cookie cutter solution.