World's Super Rich Drive 77% Surge in Superyacht Sales Last Year
Superyacht Sales Jumped 77% Last Year as Inventories Shrank
(Bloomberg) -- Superyacht sales climbed to record levels last year, sapping supply and boosting prices to heights unlikely to soften despite the tumultuous start to 2022 in financial markets.
A total of 887 superyachts were sold in 2021, a 77% jump from a year earlier and more than double the number in 2019, according to a report from maritime data firm VesselsValue.
Jeff Bezos, who has a net worth of $174.7 billion according to the Bloomberg Billionaires Index, is awaiting delivery of a 417-foot sailing yacht. It’s currently in the final stages of construction at a ship yard in the Netherlands. Steven Spielberg also has one on order, after listing his old yacht for $158 million. It sold in November for an undisclosed price.
Low interest rates and bumper markets fueled $1 trillion in gains last year for the world’s 500 richest people, according to the Bloomberg index. That wealth creation and heightened demand for solitary recreation due to Covid-19 were among the primary drivers of the spike in sales, VesselsValue said.
Cheap credit also helped -- making it easier to “buy social distance,” as one wealth manager put it.
Rising interest rates and choppy equity markets are unlikely to depress prices, at least for the next few months, due to a lack of inventory. Superyachts take years to build and buyers wanting vessels right away have depleted the second-hand market.
“There simply aren’t enough yachts available for purchase,” said Sam Tucker, head of superyachts at VesselsValue.
Supply-chain disruptions and worker shortages have exacerbated the situation. Shipyards are stretched to the limits and construction of new vessels is taking longer. The flip side, for existing owners at least, is higher values.
Superyachts aren’t typically considered investments. Depreciation is steep and annual operating costs are high, roughly 10% of the boat’s value. But the tight market meant that values jumped anywhere from 5% to 8% in 2021 alone.
“It’s a great time to be a yacht owner,” Tucker said. “Those who bought a year ago could potentially now sell for a profit having enjoyed a full season of free superyachting.”
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