Cruisers Forum
 


Join CruisersForum Today

Reply
 
Thread Tools Rate Thread Display Modes
Old 12-02-2011, 17:23   #1
Registered User

Join Date: Apr 2008
Location: San Diego, CA
Boat: Will be a 50' Cat
Posts: 382
Is a $100k Loss on a $400k Boat in Two Years About Right ?

Kinda bummed.... for a 2 yr cruise plan, if I were to buy a 3-4 yr used CAT for US400k (say an Orana or Dean) and we go sailing for 2 yrs then sell the thing, I figure just the boat will cost us nearly US$ 220 per DAY or about $6,600 per month if you assume an opportunity cost on the money of about 5%... This assumes one would lose about 25% of it's value in the 2 year period and $20k in R&M... clearly these CATs have depreciated by at least 25% or more in the first 2-3yrs of their life... One can buy 2-3yo $600k-700k CATs all day today for $400-500k... that's a 16% - 30% haircut....

So I guess the question is how reasonable is the assumption that a 2-3yo US$400k CAT would lose another $100k over the next 2yrs...

I guess if one keeps the boat one never has to know how much one is losing....
__________________

__________________
capcook is offline   Reply With Quote
Old 12-02-2011, 17:55   #2
Registered User
 
pressuredrop's Avatar

Join Date: Apr 2009
Location: West Palm Beach
Boat: Allied Seawind 30
Posts: 794
its only money, you only live once, keep crunching your numbers and obscure terms or get out there and have some fun
__________________

__________________
pressuredrop is offline   Reply With Quote
Old 12-02-2011, 18:00   #3
Senior Cruiser
 
roverhi's Avatar

Cruisers Forum Supporter

Join Date: Aug 2005
Location: Kona, Hawaii, Carlsbad, CA
Boat: 1969 Pearson 35 #108 & 1976 Sabre 28
Posts: 6,003
Send a message via Yahoo to roverhi
The big hit for depreciation on most items is in the first couple of years and typically in the first 15 minutes as you leave the dealer's docks for the first time. You may not lose all that much in the two years you'll be gone. The biggest thing will be keeping the boat in 'Yacht' condition given the wear and tear of 24/7 living aboard and cruising. Big difference between a boat that has been out and about to one that spends most it's time in a marina collecting bird droppings.

What's the insurance on a $400,000 boat for ocean passages?? Imagine the 'Cruising on $500 a month' crowd would be deep in the negative cash flow hole just for the insurance. Way more fun to self insure for hull insurance and carry liability for the real screw ups. Of course, most people wouldn't sleep well not carrying full coverage on a boat that expensive.
__________________
Peter O.
'Ae'a Pearson 35
roverhi is offline   Reply With Quote
Old 12-02-2011, 18:00   #4
Registered User

Join Date: Jun 2007
Location: SW Florida
Boat: FP Belize, 43' - Dot Dun
Posts: 3,425
It's a market and tied to the overall economy, not unlike the real estate market. You might lose money or make money.
__________________
DotDun is offline   Reply With Quote
Old 12-02-2011, 18:03   #5
Registered User
 
Cotemar's Avatar

Join Date: Dec 2007
Boat: FP, Helia 44 Evo
Posts: 5,717
Wow, if I used your math, I would never own a boat.
__________________
Cotemar is offline   Reply With Quote
Old 12-02-2011, 18:06   #6
Freelance Delivery Skipper..
 
boatman61's Avatar

Community Sponsor
Cruisers Forum Supporter

Join Date: Jan 2010
Location: UK/Portugal
Posts: 20,198
Images: 2
Send a message via Skype™ to boatman61
pirate

Look at it this way... how much would a 2yr vacation staying in quality selfcatering premises as you travel round the world cost you plus air, rail, taxi, ferry, car rental costs and see how it compares.. at least this way at the end you still got something.. even if its only a $300K boat.... $hit Happens...
__________________


Born To Be Wild
boatman61 is offline   Reply With Quote
Old 12-02-2011, 18:14   #7
Registered User

Join Date: Oct 2010
Posts: 679
Quote:
Originally Posted by capcook View Post
Kinda bummed.... for a 2 yr cruise plan, if I were to buy a 3-4 yr used CAT for US400k (say an Orana or Dean) and we go sailing for 2 yrs then sell the thing, I figure just the boat will cost us nearly US$ 220 per DAY or about $6,600 per month if you assume an opportunity cost on the money of about 5%...
Get used to it - boats'll cost you everything you've got. Cheaper in the long run to buy an aeroplane imo.

On the bright side, if you've got a lazy $400K then your money tree can surely grow more. The real question is not whether to buy a boat, but what the hell else could you spend it on.

Sorry, I don't suppose any of that ramble helps...
__________________
Wand is offline   Reply With Quote
Old 12-02-2011, 18:17   #8
Armchair Bucketeer
 
David_Old_Jersey's Avatar

Join Date: Oct 2006
Posts: 10,013
Images: 4
I think you are in the ballpark - will depend on how you count that loss. Might get yer cash back, but have spent $50k on maintanence (in addition to what you would have needed to do if sat in a marina 24/7). or that figure could be $10k - and you only get most of your cash back.........

........my take is it is a bit of crap shoot, outcome will depend on events outside of your control - but sounds ballpark. Of course you then have to leave............ / $$$
__________________
David_Old_Jersey is offline   Reply With Quote
Old 12-02-2011, 18:17   #9
Registered User

Join Date: Oct 2010
Location: Comox, British Columbia
Boat: Hunter 34, Heart of Gold
Posts: 108
This is why I never do the math. I started to once and then realized I couldn't afford it. I think my friend Pete had this in mind when he named his boat Tia Fewca meaning... This Is Another Fu.... Endeavor We Can't Afford
__________________
Heart of Gold is offline   Reply With Quote
Old 12-02-2011, 18:21   #10
Moderator
 
cabo_sailor's Avatar

Cruisers Forum Supporter

Join Date: Mar 2008
Location: Tarpon Springs FL
Boat: Cabo Rico 38
Posts: 1,905
When I bought my first boat I kept a meticulous log of what I spent on it. After a few months I stopped doing so because it was so dang depressing.
__________________
cabo_sailor is offline   Reply With Quote
Old 12-02-2011, 18:31   #11
Registered User
 
Cotemar's Avatar

Join Date: Dec 2007
Boat: FP, Helia 44 Evo
Posts: 5,717
This says it all.
Attached Thumbnails
Click image for larger version

Name:	money_boat.jpg
Views:	184
Size:	72.3 KB
ID:	23742  
__________________
Cotemar is offline   Reply With Quote
Old 12-02-2011, 19:27   #12
Moderator
 
Boracay's Avatar

Cruisers Forum Supporter

Join Date: Feb 2004
Location: Pelican Bay, Great Sandy National Park
Boat: Steel Roberts Offshore 44
Posts: 5,175
Images: 18
Pencil and paper?

A quick search on Yachtworld of cats from 45' to 50', 2009-2011 (2 yr old?) and 2004-2008 (4 year old?) suggests that a 2 year old 45 - 50' cat is going to cost closer to $1mil than $400K. Some serious pencil work could give better figures.

My rule of thumb before I purchased was that the boat would cost 25% of good condition value p.a. so using that as a guideline your 2 yr. old $700k cat is going to cost more than $350k for 2 years, plus selling brokerage.

Only you can work out what it is that you want , but assuming a 4-5 year old cat is in your price range then you'd be looking at a loss of well over over $220k.

Another quick search of Moorings Brokerage suggests that a 5-6 year old 47' Roberson and Caine Leopard may be in your price range, allowing for necessary repairs/upgrades/modifications to put it in cruising condition. This is given as an example only as it is a major purchase and you need to rely your own inquiries.

This is a big boat. Do you really need something that big?
__________________
Rust never sleeps
Boracay Blog.
Boracay is offline   Reply With Quote
Old 12-02-2011, 20:52   #13
Registered User

Join Date: Apr 2008
Location: San Diego, CA
Boat: Will be a 50' Cat
Posts: 382
Quote:
Originally Posted by Heart of Gold View Post
This is why I never do the math. I started to once and then realized I couldn't afford it. I think my friend Pete had this in mind when he named his boat Tia Fewca meaning... This Is Another Fu.... Endeavor We Can't Afford

Ha, I think you are right... I guess if you keep doing the math, you would end putting off this kind of lifestyle change and work til you drop or end up saving a big nest egg just to hand it over to the Nursery Homes and Hospitals... so stop figuring and start spending is probably the what one just has to do...

The $400k is for a decent 45 Dean or 44 Orana...3-4yo wouldn't want anything bigger, not that I could really justify or afford it anyway..

Thanks all for your comments...

Cheers
__________________
capcook is offline   Reply With Quote
Old 12-02-2011, 20:58   #14
Registered User
 
Doodles's Avatar

Join Date: Nov 2009
Location: Virginia, USA & Krabi, Thailand
Boat: Wauquiez Pretorien 35; Nordica 16
Posts: 2,810
Images: 1
Quote:
Originally Posted by DotDun View Post
It's a market and tied to the overall economy, not unlike the real estate market. You might lose money or make money.
Dream on ....
__________________
Mundis Ex Igne Factus Est
Doodles is offline   Reply With Quote
Old 13-02-2011, 13:41   #15
Don't ask if you can't handle it
 
sailorboy1's Avatar

Cruisers Forum Supporter

Join Date: Jul 2007
Location: On the boat somewhere
Boat: Hunter 410
Posts: 12,310
Quote:
Originally Posted by capcook View Post
Kinda bummed.... for a 2 yr cruise plan, if I were to buy a 3-4 yr used CAT for US400k (say an Orana or Dean) and we go sailing for 2 yrs then sell the thing, I figure just the boat will cost us nearly US$ 220 per DAY or about $6,600 per month if you assume an opportunity cost on the money of about 5%... This assumes one would lose about 25% of it's value in the 2 year period and $20k in R&M... clearly these CATs have depreciated by at least 25% or more in the first 2-3yrs of their life... One can buy 2-3yo $600k-700k CATs all day today for $400-500k... that's a 16% - 30% haircut....

So I guess the question is how reasonable is the assumption that a 2-3yo US$400k CAT would lose another $100k over the next 2yrs...

I guess if one keeps the boat one never has to know how much one is losing....
You are doing finanical math and are going to make yourself crazy. But I wouldn't go with assumption of the boat costing you $100k value in 2 years if you are buying it NOW. The market is probably still near bottom so you could get a good deal and if the market improves a little (which it is) the boat may not take such a big hit.

What are 4-5 year old cats selling for now, that is the price you are going to get in a couple of years on your now 2-3 year boat.

But in the end owning boat is like buying any non-investment item, you are losing money!
__________________

__________________
sailorboy1 is offline   Reply With Quote
Reply

Thread Tools
Display Modes Rate This Thread
Rate This Thread:

Posting Rules
You may not post new threads
You may not post replies
You may not post attachments
You may not edit your posts

BB code is On
Smilies are On
[IMG] code is On
HTML code is Off
Trackbacks are Off
Pingbacks are Off
Refbacks are Off


Similar Threads
Thread Thread Starter Forum Replies Last Post
'Three Years in a 12-Foot Boat' by Stephen G. Ladd unbusted67 The Library 9 18-12-2010 13:28
If You Had $400K to Buy a Cat.... Denvermike66 Multihull Sailboats 70 13-06-2010 10:11
Best Boat(s) for Caribbean Cruising Under 100k Homespun Monohull Sailboats 22 13-02-2010 07:32
Have You Found Things Years into a Boat? Tampabayfireman The Sailor's Confessional 73 07-11-2009 16:31
2 years planning, 2 years sailing...was it worth it? ABSOLUTLY!!! kingfish General Sailing Forum 14 19-04-2009 17:35



Copyright 2002- Social Knowledge, LLC All Rights Reserved.

All times are GMT -7. The time now is 03:07.


Google+
Powered by vBulletin® Version 3.8.8 Beta 1
Copyright ©2000 - 2017, vBulletin Solutions, Inc.
Social Knowledge Networks
Powered by vBulletin® Version 3.8.8 Beta 1
Copyright ©2000 - 2017, vBulletin Solutions, Inc.

ShowCase vBulletin Plugins by Drive Thru Online, Inc.