Sunday, 3 July 2016

Lessons learned from buying an ex charter boat

Our ex-charter at anchor in Greece.
We’ve been living on and upgrading/outfitting Maple for nearly a year now, she’s an ex charter boat, which made the purchase process a bit different than if she was privately owned.  It has also made our first year on board a bit different than if we had purchased a private boat. 

There is a stigma attached to ex charter boats that reduces their value.  Most equate buying an ex charter boat to purchasing an ex rental car.  After doing lots of reading on the topic and seeking out experiences from others who have been there/done that we came to the conclusion that its not the same thing, and the price differential weighed in our favour. 

This post will take a look at some of the lessons learned from buying an ex charter boat.

1)     Phase Out is your friend.  Boats coming out of charter typically will go through a phase out process.  This is meant to ensure that any unreasonably/excess wear on the vessel is fixed so that it is released to the owner (or new buyer) with a reasonable degree of wear and tear (ie: the equivalent of any other 5 year old vessel). 

Most charter companies (and charter owners) put this process off until the boat is under contract and a survey arranged by the buyer.  They do this because they’re cheap.  They don’t want to pay for a survey for phase out only to have the buyer do another survey a month down the road.  This works in your favour because when you do your survey you get to identify all of the deficiencies in the vessel and demand they are repaired as part of the phase out process.  Of course the charter company may argue that the items under discussion are reasonable wear and tear and not subject to phase out but our experience (and that of others) suggests that the significant things and most of the minor deficiencies will be addressed.

Some of the major things to look for are:
·      Grounding damage.  Remember charterers don’t sail full time and likely are not familiar with the boat type or cruising grounds.  This means they are much more likely to bump the bottom.  Check for evidence of damage that has been repaired (and ensure that it’s been repaired properly).
·      Engine abuse.  Charterers are out for a week, and must have the boat back to the base on time.  This means they must make passages regardless of the wind/weather.  Engines may be used more than sails and certainly more than a privately owned boat that has had the luxury of waiting for the right wind.
·      Ground tackle.  We missed this one.  Many charterers (in the med at least) spend every night at the town quay or in harbour.  This means they need minimal ground tackle that won’t be sufficient for full time cruising.

Do not be afraid to put every single little thing on the deficiencies list the worst that can happen will be for the charter company to refuse to repair the item.

2)     The charter company is not your friend.  Agreeing to fix items on the deficiencies list does not necessarily mean that the charter company will address the item fully, or to your satisfaction.  Once the boat is under contract the charter company loses interest in it – it can only cost them money at this point in time. 

In hindsight this seems obvious but we made the mistake of trusting the charter company we bought from to stick to the deal.  Unfortunately, they did not – work on the boat was not completed in the time frame specified in the contract resulting in many extensions.  I think it also caused them to rush through some of the repairs specified.

As with any contractor, it’s up to you to ensure that work specified is done in the timeframe agreed upon.

3)     Your surveyor is not your friend.  True – a surveyor is supposed to look after your interests, help inspect the boat you hope to buy, point out major issues and minor ones, and generally provide a level of confidence that the vessel you’re buying is sea worthy.  They do all of this, but they do it as part of a business.

We made the mistake of having our surveyor follow up on our deficiencies list with the charter company.  This worked out well in that we were informed when the work was not completed in the timeframe specified.  The surveyor also did a great job of ensuring the more significant deficiencies were addressed.  Unfortunately, our surveyor was not as diligent as we would have been in ensuring the more minor deficiencies were taken care of.  We relied heavily on his feedback given that we were in Canada and the boat in Greece. 

It would have been worth flying over to review the work in person once completed as the quality of some repairs were a bit lacking (mostly gel-coat colour matching and general cleaning).

The only one really looking out for your interests is you.

4)     Attached equipment – what attached equipment?  Chartering a boat is different from cruising.  Most folks out for the weekend don’t need the same thing that a family spending several years on board considers important.  This means you will be spending time and money to outfit the boat the way you want it.
This one was no surprise for us, I may have underestimated a bit the cost and hassles associated with properly outfitting the boat but now that we’re 11 months in I think we’re nearly done sourcing equipment and spares.

While a privately owned boat may have been outfitted with many of the items we had to buy they would likely have been older and possibly end of life, and certainly would not have been what I would have installed.  By outfitting an ex charter I ensure both brand new systems, and ensure that I know how they’re installed so I can fix them when (not if) I need to.

Be sure to set aside time and money needed to properly outfit an ex charter boat.

We still think that an ex charter boat was good value for us but as with most things we’ve done over the last year the purchase process was a learning experience and we’d do some things differently if we were to do it again.

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