
Selling a yacht named "Bad Debt" might seem like a challenge in a season of escalating home foreclosures, subprime lender bankruptcies and near-record fuel prices.
But Bill Solt, a broker for Ardell Yacht and Ship Brokers in Newport Beach, seemed optimistic about finding someone to pay $495,000 for Bad Debt, a 50-foot Ronin cruiser on sale at the Newport Boat Show, which starts today on Lido Island.
"A boat's a toy," said Solt, a broker for 35 years. "We're selling fun. We're selling adventure."
The Newport show, now in its 34th year, is the West Coast's largest in-water exhibit of yachts with more than 320 boats – a show record – open to visitors through Sunday.
One "toy" on display is a 98-foot Horizon cruiser owned by Jim Baum of Pasadena. It has 2,200 square feet of living space, walk-in closets, beds for 10 and eight plasma TVs, the largest of which has a 63-inch screen. A similar boat sells for $5.3 million or charters for $39,500 a week.
"People are going to have their fun," said Baum, a retired airline pilot and investor. "People are going to find discretionary income to do what they want."
Fun or not, boat sales are expected to be flat in 2007 after a decline in volume in 2006, said James Petru, director of industry statistics and research for the National Marine Manufacturers Association. While total volume dipped, revenue rose in some categories as people paid more per boat for innovative navigation gear and all the comforts of home, Petru said.
In-board cruise boats, generally longer than 24 feet – the type of craft at the Newport show – illustrate the trend: Sales volume fell 24 percent last year to about 5,900 units nationally. But the average price jumped 11 percent to $444,900.
Newport Beach and Southern California don't always track the nation. Duncan McIntosh, producer of the Newport Boat Show, has seen no signs of a slowdown in local boat sales, although he would not be surprised if the slumping real estate market could have a negative impact.
"We saw a wave of people use equity in their homes to purchase toys they like – vacation homes, RVs, boats, whatever," he said.
In 2005, the most recent figures available, spending on boats jumped 8 percent nationally but 6 percent in California. The state ranked second nationally in total sales at $1.3 billion, behind Florida, where sales exceeded $2.5 billion and rose 18 percent.
Jeff Helsing, sales manager for Crow's Nest Yacht Sales, the largest exhibitor at the show with 22 boats on display, agreed that now is as good a time as ever to sell yachts.
"Guys with big dollars are spending," he said. "Getting them to spend it with me is a different story."
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