If your clients are in the market for a “floating mansion,” now may be the time to buy.

Sales of used super yachts, those over 100 feet, have been selling at deep discounts since the market tanked in late 2008.

“There are still a lot of bargains around,” says Curtis Stokes, owner of yacht broker Curtis Stokes & Associates in Fort Lauderdale, Fla. “There are some great buys out there, but the inventory is thinning.”

Before the downturn, ultra-wealthy individuals couldn’t get enough of the ultimate status symbol. They were buying bigger yachts and flipping them like condos in Florida.

“The whole industry fell off a cliff about 18 months ago,” says Kenneth Wooton, U.S. associate editor of The Yacht Report. “It had been extremely strong for some years prior to that. Builders had backlogs and plenty of business, more in some cases than they could handle.”

Yachts normally take about two years to build so the backlog carried some shipyards through part of the recession, but lack of new orders and an overhang of used yachts for sale drove other builders to layoff employees and restructure debt.

European superyacht makers, Beneteau in France, Ferretti in Italy and Bavaria Yachtbau in Germany, suffered huge losses, Business Week reported in April.

“The biggest change that has been seen is pricing, with multiple price cuts on the second-hand yachts,” says Elie Brade, the research editor for The Yacht Report. “It’s a combination of owners wanting and needing to sell and buyers being much more ruthless in terms of what they are willing to pay for a yacht. New build orders are significantly down from previous years, although in early 2010 we have seen some tentative signs of growth in the market with new build orders placed at the end of 2009 and beginning of 2010 including a 140 meter motoryacht from an Italian shipyard and a 47 meter motoryacht from a Dutch shipyard.”   

The last 18 months have been the perfect storm for super yachts, says William Smith of Trinity Markets in Gulfport, Miss., which is one of the largest shipyards nationally.

“The combination of a falling market, a new president and class warfare has prompted buyers to keep their hands in their pockets," he said.

Smith says a backlog has helped him weather the downturn, but “it was very, very quiet in 2009."  He hasn’t seen any new orders yet, but “now that the market is back, the inquiry level has increased."

Financing is also a problem, at least for new boats, according to Smith. “Financing for yachts dried up,” he says. “They says they’ll lend but they want high interest rates and lots of money down.”

Of course, it’s unlikely that buyers of the biggest super yachts need financing. For example, Russian billionaire Roman Abramovich is reported to own the world’s largest yacht, the bullet-proof 525-foot Eclipse, which was built by Blohm + Voss Industries in Germany at a cost of $350 million.

“So much of this is psychological,” Smith says. “They see they have half the amount of money and they reconsider buying even though they still have billions.”

Plus, the superyacht market is worldwide. Boats are built globally and are mobile so they are not constrained by local conditions the way the housing market is. In fact, a weaker dollar is making sales in the United States more attractive.

Yachts that are being built now are larger than ever, says Glenn Rogers, co-founder of super yachts.com. But he thinks brokers will make out best this year because it is really a buyers market in used yachts.

“It’s never been a better time to buy a super yacht,” he says. “You’re seeing values coming off 25% to 40%.”

He also says he is seeing more fractional ownerships of yachts, or time shares on the high seas. “The notion of value is proliferating throughout the whole industry,” Rogers says.

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