The discussion of which of them is a win-win option has been lasting for decades. While some considered yachts, especially luxury ones, the best investment in their status and image, others argued that real estate is an eternal value worth investing in at any time and anywhere.

Who is right in this clash of opinions? We bet on the first ones, and we have several reasons for that. In recent years, yachts transformed from a property for the rich to a convenient and profitable asset, moving real estate from the pedestal. Why did it happen, and why are yachts outperforming real estate today? Let’s share our thoughts about that.

Yacht Investment vs Real Estate Investments – What’s Simpler?

First, let’s compare the simplicity of investment, as this factor often becomes a decisive one for a future investor.

When buying real estate, you face multiple choices and challenges like the following:

• Which type of property to choose: a new construction or a second-market one, a luxury condo apartment or a villa? Choices are diverse, and making them takes time and effort.

• Which construction company is worth your money and trust? Situations when investments in the object under construction were simply wiped out by the bankruptcy of the construction company are not rare, unfortunately.

• Proper location of the property to invest in and the goals for its further use are also challenging.

• At last, it is quite difficult to conclude a deal with a real estate owner directly peer-to-peer, as such deals should be supported by a skilled real estate agent, an attorney, a notary public, as well as an insurer. This requires more time and costs to pay all these specialists for the deal support.

• One more reason for making real estate investments risky refers to the aftermarket real estate. Often, such investment objects have additional encumbrances like mortgages, loans, several owners for a single object, etc.

When you decide to buy a yacht, most of these challenges won’t even occur. The deal is held directly with the owner, it takes less time to conclude it, and there are fewer risks to get on a mortgaged or arrested property.

The Risks Following Investments in Yachts and Real Estate

So, there are various risks related to these two investment assets.

For real estate investments, risks include:

• Inflated costs of a chosen real estate item.

• Faulty deals with unreliable sellers.

• Additional costs for concluding a deal.

• Wrong choice of an object to invest in.

• Trends for real estate to decrease its value over time.

For the investment in a yacht, these risks are not so considerable, and often they are limited only to the risk of buying a yacht in improper condition, which is mitigated fully if you buy a vessel from a shipyard or you deal with an experienced valuator whose appraisal will be accurate and thorough.

Possible Benefits of Investing in Yachts Instead of Real Estate Investments

Yet, let’s turn the page of negative connotations and compare the benefits of investing in these two types of property.

When you buy a villa, a mansion, or an apartment, what can you do with them? The best-case scenario is to reside in a property you purchased or to rent it out. The last option may bring you some income, but compared to the average pricing for real estate, you shouldn’t expect that it will pay off anytime soon. Typically, it takes a decade to pay off such an investment, and during this time, additional costs for maintenance, repair, restoration, or renovation will lie on your shoulders.

Besides, your property remains in its place all year round, and in most directions, you may face the low season when you can’t rent it out or the demand will be too low.

The ideas about what to do with your yacht are diverse. Besides using it for challenging trips anywhere to your choice, you can make it:

• Your vacation residence to save on hotels or accommodations;

• Your unique transfer method: why pay for flying from Java to Bali if you can take your yacht and sell it there?

• Your source of regular or irregular income. Once you do not use your yacht yourself, you can rent it out, charter it peer-to-peer, or make a business in the field of yacht trips, diving tours, wedding trips, or any other tourist amenity involved in sea traveling.

We should also mention that yachts have exclusive benefits compared to real estate, which outperform the latter investment:

1. Yacht maintenance costs less than the maintenance of real estate, and it requires fewer activities.

2. Yachts are diverse, but even the smallest ones can be deluxe and outstanding in their capabilities. Can you say the same about real estate? A small studio will never match a deluxe mansion either in price or in comfort.

3. Yachts are more liquid assets. It can take years before you manage to sell your real estate property. Yachts have lower competition in the market, and they are always in demand.

Summaries

Although traditionally real estate has been a staple investment asset, in recent years, in times of global uncertainty and economic crises, it is not a universal solution for money investors. Multiple risks, rigid operation with this type of property, and constantly decreasing value of a purchased object make it a risky investment after all.

Yachts retain their value and have fewer risks of owning them. Besides, they are a developing business niche where you can make your life work with a low entry point and fast pay-off.