A water slide on Savannah, a 274-foot hybrid superyacht.

Courtesy of Northrup & Johnson

A version of this article first appeared in CNBC’s Inside Wealth newsletter with Robert Frank, a weekly guide to the high-net-worth investor and consumer. Sign up to receive future editions, straight to your inbox.

Superyachts sales took a dive in 2023, as long waiting lists, soaring costs and oligarch sanctions hit demand, according to a new report.

Sales of new superyachts (yachts over 100 feet long) fell 17% last year, according to the new SuperYacht Times’ State of Yachting report. There were 203 sales of new superyachts in 2023, down from 245 in 2022 and down from the record 313 in 2021.

Ralph Dazert, head of intelligence at SuperYacht Times, said a buyer placing an order for a new yacht over 200 feet today faces wait times of three to four years due to backlogs stemming from the pandemic. Prices are also soaring due to higher labor and material costs.

Dazert said he expects new superyacht sales to “go down a little bit further this year” given the continued costs and delays.

The largest superyachts took the biggest hit, with sales of yachts over 200 meters, or roughly 650 feet, falling 40%. The main reason for the large superyacht drop is due to the fact that rich buyers from Russia are dropping out of the market following the Ukraine invasion by the country in 2022, according to the report.

“The Russians were prone to ordering very extravagant and very large yachts,” he said.

Americans are picking up some of the slack, accounting for nearly a quarter of all superyacht sales last year. And while Americans tend to build smaller yachts compared to Middle Eastern and Russian buyers, the American boats are getting larger.

The average length of a Saudi-owned superyacht is 202 feet, compared to 200 feet for Russian buyers and 177 feet for the Americans, according to the report.

Even as new sales declined, yacht completions were up. That data represents yachts ordered during the frenzy of the pandemic that are just now being launched. The number of completions surged 31% in 2023 to 202 superyachts.

The rising fleet of superyachts translates into a growing demand for the entire ecosystem of the yacht economy — from builders and brokers to marina slips and crew. There are now nearly 6,000 superyachts, triple the number in 2002, according to SuperYacht Times.

Dazert said the flood of wealthy buyers who came into the market for the first time during Covid continue to use their yachts. Many are upgrading, which means the high-water mark for the yachting economy will likely keep rising.

“The pool of customers has expanded permanently,” he said.

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