New York Yacht Sales Rebound After Hurricane Sandy

Yacht sales in New York are on the rise since Hurricane Sandy in 2012. As a result, it’s anticipated that local New York waterways will be crowded.

Stock portfolios and real estate values have been rising over the past few years, and sales of recreational boats of all sizes increased 7.3% in New York state in 2014, bucking a national trend of sinking sales, according to a National Marine Manufacturers Association report.

“After years of floundering U.S. sales as a result of the economic maelstrom that was 2007 to 2010, last year saw another sharp 60% decline nationwide for recreational boat sales,” says Gerrick Johnson of BMO Capital Markets.

A large part of the NY metro-area rebound, aside from the general economic recovery, is that local boat brokers are getting a boost as storm-ravaged property owners get around to replacing some of the 65,000 or so boats destroyed by Hurricane Sandy in 2012.

“When your home and car have been destroyed, replacement of boats is usually the last priority,” Johnson explains.

As a result, area boat dealers say they’re currently expecting one of their best years ever. Howard McMichael, who owns McMichael Yacht Brokers of Mamaroneck, NY, says he expects his new boat sales to go up about 20% this year, with used (or “brokered”) craft doing even better, rising 25%.

“There’s a very active market for boats that are in nice shape,” he says.

New York boat dealers also say they expect wind in their sales due to the state legislature’s controversial March move to cut sales tax for luxury boat purchases by taxing only the first $230,000 of the sale.

Keith Cooper, who sells sailboats and sailboat timeshares (which go for $8,000 to $15,000) at his Chelsea Piers SailTime franchise, says he is already two-thirds booked for the season and expects to fill up soon, a feat that he didn’t accomplish last year.

Cooper says he has yet to score a definite benefit from the recently enacted tax break, but he expects to be able to sell “another boat or two” before the year is out.

“It won’t necessarily turn a ‘no’ into a ‘yes,’ but it will turn a ‘yes, I want a boat’ into a ‘hell, yes, I want a boat,’ ” he says.

“This will help large boat sales in New York,” agrees McMichaels. “Before this, it made sense just to go to Florida and buy that $4 million powerboat.”

Source: Ed Zwirn, New York Post