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Old 09-08-2007, 05:38   #76
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Good summary, Chris.

This also goes along with the way of thinking that got me to this crossroads in the first place.

After a night to sleep on it, we have come up with some factors based on Ex-Calif's post.

Here is what we need in a boat:

*Boat for planned cruising grounds of New Jersey to Greenland
*Boat that is at home in a half-frozen harbor
*Boat that can be used to break small ice coverings
*Boat that can store 1/4-1/2 cord of wood out on deck safely anchor
*Boat that won't allow moisture to seep into the hull which will freeze and crack the gel coat
*Boat where we don't have to worry about scratching the cabin sole, topsides or deck
*Boat will spend well over 90% of the time at anchor, rather than underway - it's how we live. We work and stay in one place. Moving will only be short distances (a few hundred miles) here and there. Mostly, we will be staying in one place or at least one region. No Caribbean, no other countries (maybe using Dockwise) and that's it.

Those are the requirements.

The Gulfstar does not meet those cruising requirements. We have to part with her for non-financial reasons after all. We may even get a small loan to cover the cost of a boat that fits the above, keeping cash as a cushion/reserve until the refit is done.

This thread helped us so much, I can't even begin to than you all enough.



Quote:
Originally Posted by chris_gee
Just looking at the financial side if you have roughly a $60,000 loan on the boat the interest on that plus other expenses is equivalent to rent. Pretty cheap rent I would guess. It isn't really correct to say that in x years I will have paid y unless you deduct the rent you would otherwise have paid.
As to depreciation yes there may be some - I mean what value would one put on a 40 yr old boat vs 30 or 20. However much of this will depend on condition and what has been done in maintenance. Whether it goes down in dollar terms or real terms in another matter. Inflation is officially say close to 4% but other people say this is way too low. Assume it is 4% (ha) then over 18 years the value halves in real terms while it may have the same nominal value. In reality it may be closer to ten years.
You seem to think that your extra earning money could be better placed invested. However the aftertax and fees income is unlikely to be more than the interest you are paying. First pay off debt. If you are paying 7% or 8% you are unlikely to make that nett off investments. Sure sometimes you will but sometimes you will lose.
With the boat you have a depreciating asset but cheap rent.
Long term from an investment point of view if it interests you I would suggest you really need solid assets like real estate. Despite the sharp and impending further drops in the current market over the long term in pays. I would not recommend either real estate or stocks at the moment, rather building cash.
I don't know your wishes or values, but you seem to be giving some thought to the longer term. Go now is fine for fun but in ten years on average you can expect real estate to have doubled and that makes it hard to get in that much further down the road.
Ideally one needs enough $ for any real estate to cover the costs by rent. Probably that means about a 50% deposit given rents are lower than interest. However after ten years you would probably own it outright and thus have a source of income albeit small.
Some people opt to go now with little capital, others get a capital base first. Your choice. But there are consequences.
The Australia or New Zealand thing sounds okay. But in Australia you pay duty and tax including on deemed delivery cost. I don't know if they exempt you if you are an immigrant and you don't sell for two years as in NZ. NZ duty and tax work out at 20% and most boats asking prices seem inflated. However many stick on the market for a long time and fall substantially. eg a Westsail 32 listing privately at 160k NZ US say 110 at the time, dropping to 80k NZ or 60k US which is probably about right. Where the prices are too out of line people can buy themselves in the US so why would they pay that much over the top? Further to get the boats there requires outfitting to ocean standard (add maybe 15-20K US) so I suspect the real gains may well disappear in practice.
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Old 09-08-2007, 11:19   #77
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Sounds like you are looking for a steel trawler. Steel is the best way to deal with ice, and a trawler more capable of motion than a barge. (And probably much better at dealing with ice.)
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Old 09-08-2007, 11:49   #78
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Quote:
Originally Posted by ssullivan
Here is what we need in a boat:
*Boat for planned cruising grounds of New Jersey to Greenland
*Boat that is at home in a half-frozen harbor
*Boat that can be used to break small ice coverings
*Boat that can store 1/4-1/2 cord of wood out on deck safely anchor
*Boat that won't allow moisture to seep into the hull which will freeze and crack the gel coat
*Boat where we don't have to worry about scratching the cabin sole, topsides or deck
*Boat will spend well over 90% of the time at anchor, rather than underway - it's how we live. We work and stay in one place. Moving will only be short distances (a few hundred miles) here and there. Mostly, we will be staying in one place or at least one region. No Caribbean, no other countries (maybe using Dockwise) and that's it.
The first criteria would certainly argue against a “barge-style” houseboat; whereas, keeping your budget in mind, the others might suggest it.
Your search would become easier, if you could further restrict your planned cruising grounds to nearby coastal locations.
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Old 09-08-2007, 13:10   #79
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Sean, here's a very affordable Bruce Roberts 34' steel cruiser, in Maine. Needs some work that I am certain you could do...

eBay Motors: Bruce Roberts 34 Custom Offshore Sailboat Steel Sloop (item 220136896739 end time Aug-13-07 12:51:49 PDT)

Also, I had previously said you would have to pay for peeling of your gelcoat. However, I was just reading Don Casey last night and he says you can do it yourself. Not with a mechanical peeler, but with a "lightweight disc sander and 24-grit disc on a foam pad". It would take you a while and it would be messy, but less expensive than paying for a peel.
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Old 09-08-2007, 13:44   #80
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Mate thats a cheap boat. Hey Brian and Clare!! you see that???
I had in my mind one concern with theis idea of 30-40K for the barge/refit. It would simply not be possible in NZ and I don't see how it would be possible to do it is the US either. But now seeing this Roberts, maybe I should change my mind. Maybe materials are really cheap over your way. Which does do one negative thing though, it means I now have less sympathy for you US blokes that whine about costs :-)
Now I realise the original barge has sold, but a quick budget for an example. And this is based on NZ costings.
Two out 40Hp second hand outboards(real cheapies) 5K
Stearing for them 2K
20ltr Epoxy resin and glue powders. (Cheapest available) $400
Assortment of SST screws and boat nails $500
Timber= teak is 9.5K per cubic metre(yard)
White pine is 2.6K
1/2" ply about $100/sheet
3/4" ply about $150/sheet
Marine grade BS1088 about $200/sheet
Fittings such as hinges and latches etc latches can be ruffly $50 each. Hinges about the same per set.
Paint about $150 gall. for turps based paints. Can be well approvching $300 per gall for two pot paints.
Then the tools required if you don't have already. Like saw bench, planer, maybe a thicknesser etc etc. And that doesn't cater for fitout of electr4ics and water and black water holding and showers and so on. I just can't see it being able to be done.
Actually Knotty bouyz budget woudl be a good one to see. Hey Rick, any chance of posting that again????
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Old 09-08-2007, 14:04   #81
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Sean,

Your mortgage is tax deductible and the cost is probably pretty reasonable compared to rent.

The Gulf can be used for charter also... a barge cannot. You don't have to work her as a charter boat... you can just live aboard and be a bar tender or whatever.

As far as ice goes... it is not a problem at most marinas in LIS for example and living aboard on a dock in the winter makes more sense than using a dink and anchoring out. Nutz. I lived in Norwalk in the winter in Shiva and motored to the fuel dock through ice/slush and had no damage. I just waited for a tug pulling a barge to mix it up a little and then I followed in his icey wake. hahaha

If you are on a dock... you don't need chord wood storage and I suggest you get an Espar or Webasto or similar diesel fired heater. They work great. And if you can't move the boat to get more fuel.. You can use jerry cans.

Working whilst living aboard in the NE is a pisser using a dink. My winter yard has several liveaboards... a doctor or two... a surveyor, a rigger. They use the facilities in the yard, have propare heaters or diesel and a car.

You will probably lose money selling the gulf and it makes no sense.

A lot will depend on the work you do... where you keep the boat. CT has lots of convenient to work marinas.

You need to think this through.

jef
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Old 09-08-2007, 15:04   #82
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Thanks for the additional replys. The barge was only an example. I would LOVE a steel trawler (picture a 40-60ft Nordhavn made of steel, but with tires and a black hull you can really cozy up to rough docks and pilings).

The Bruce Roberts is interesting, but too small WAY too small because it's only 6 tons. I can't go any less than the 13 tons I have now. 30 tons would be nice. I don't like light boats anymore. I'm looking for an island, not a cruiser.

Good ideas though, and thanks for the input. But I think everyone is finally seeing why I need to change boats. The Gulfstar is made for cruising and going to the warm Caribbean Islands. I'm not doing that. I'm hunkering down through Nor'Easters and burning wood to stay warm. A different type of experience. Solitude.

Anyway, good posts. I'll keep on searching... I still want to find an old commercial vessel and redo her. I know I'm nuts, but hey... I was nuts to buy this Gulfstar and I'm sure you'd all agree she turned out ok after the refit, no?
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Old 09-08-2007, 15:05   #83
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Quote:
Originally Posted by GordMay
Your search would become easier, if you could further restrict your planned cruising grounds to nearby coastal locations.

I see no reason not to limit the planned cruising grounds to nearby coastal areas. Do you have something in mind with that limitation in place?
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Old 09-08-2007, 15:09   #84
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Quote:
Originally Posted by defjef
Sean,

I suggest you get an Espar or Webasto or similar diesel fired heater. They work great. And if you can't move the boat to get more fuel.. You can use jerry cans.

You need to think this through.

jef
sv shiva
Definitely need to keep on thinking. But, Ex-Calif really hit the nail on the head. The most basic thing is to match the boat style to what you plan to do with it. Gulfstar doesn't really do what we are looking for.

And you know my feelings about diesel heaters! ha ha I like reliability, not moving parts. Wood stoves are the only way I'll ever heat a boat. If you can get a spark going (lighter, flint, rub 2 sticks together) you have heat. I'd like things to be even more simple next time, not more complicated.

The guy next to me had his Webasto break down last year in Jersey and it was 2 weeks of freezing before his part came in. Yowch! Can't risk that when you are up North.
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Old 09-08-2007, 15:14   #85
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If you can deal with a wood stove... fine. Cutting and hauling wood and the mess is a tradeoff. I'd rather deal with vigilent care of the heater.

But YES... what do you want to do with the boat? If it JUST a home, get a house boat. Art at the boat yard lives on one and races on someone else's boat.

Glass is pretty low maintenance... Steel is not.

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Old 09-08-2007, 15:17   #86
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Sean,
That is why I moved South. Electricity would go off in an ice storm and no heat. Wood stoves are fine, if you have a supply of wood. I hate being cold. I could see a barge but if you are looking for financial appreciation water front property is your best bet.
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Old 10-08-2007, 04:21   #87
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I don’t have any specific leads; but such a revised criteria sounds a lot like a “houseboat”, or a landing craft/barge conversion.
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Old 10-08-2007, 10:54   #88
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Check those Calculations....

Sean,

Two comments on your financial analysis - not on your plan/wants/goals.

One thing not mentioned in your financial analysis is today's value of the dollars used in your analysis. You totalled up the cost of your boat payments, some $101K as I recall, but did not calculate what sum that represents in today's dollars.

As you know, a dollar today is worth more than that same dollar 13 years from now. Excel has the function wizard that will compute the Net Present Value (NPV) of a series of cash flows (namely your boat payments). You will have to assume an inflation rate, and you run the analysis assuming one low and one high rate of inflation (minimum).

The dollars you must spend on the barge and refit are valued in today's dollars since all of your expenditures will be up front. Compare that to the time-adjusted value of the boat payments to get a more precise comparison of the two options.

The second thing that you may have missed: I get the impression from your analysis that you feel that by keeping the boat you will have zero savings, whereas by buying the barge you will be able to accumulate some savings in the bank. I suggest that the equity in the Gulfstar built over time is the same thing as money in a savings account using option 2.

Take your loan amortization schedule and plot the loan balance as compared to your estimated value of the boat (using your depreciation figures). At any point in time the difference between the 2 figures is your equity in the boat. By mapping / graphing this out, you can see that in December 2010 my loan balance is 'x' while the boat value is 'y.' This equity is the same as your savings of course - even though not as liquid. Obviously, your maintenance habits will greatly affect the amount of equity that remains in the boat when you finally swallow the anchor and move ashore.

So to be precise, you should reduce all values in your equation to present-day dollars (NPV). Going through this pain will give you a true picture of the costs / benefits.

IMHO, it sounds like the pros/cons are:
- Gulfstar: Higher equity at the end of the loan, lower maintenance costs, higher monthly cash outlay.
- Barge: low resale / salvage value at end of use, higher initial costs (remember that the $$ you spent for the Gulfstar is already spent), lower monthly cash outlays, and a maintenance costs "wild card". (For example a single haul-out could break the bank... unless the average travel-lift can handle it; steel hull repairs vs frp, yadda yadda)

Don't know about you, but I'd rather fix boat stuff than do these analyses...
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Old 10-08-2007, 14:28   #89
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Mark,

Thanks for the NPV tip. That is exactly what I need to do - reduce it all to today's dollars. That will clear up a lot of the confusion in the spread sheet.

Even though we have emotionally seen a light here at the end of the tunnel, I will run the numbers anyway to be sure it's not a financial disaster.

Gord, I agree - we are looking at less of an ocean going vessel and more of a coastal cruiser. Probably will help with costs to stay in that range too.

We're going to excercise the Gulfstar for a couple weeks starting tomorrow.

I will probably not be on the computer while we're cruising.... so thanks everyone again. This thread has helped us our in our thinking tremendously.
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Old 27-08-2007, 14:48   #90
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Great news!

To all of you who coached me to say calm, and not go nuts over one survey, the mystery is solved!

The gel coat cracks had appeared on the survey we had done for our pre-purchase. They were defined as crazing on the underbody, non structural in nature. The suggested fix (by our surveyors) is to grind out the cracks and fill in with some new gel coat. The cracks are NOT blisters and we are quite relieved.

The most recent survey was done shortly after haul out after 2 years in the water straight. This left water around the crazing areas, which dried out subsequently after a few more days on the hard. I guess the water just stuck in the tinly little cracks, rather than "between the gel coat and the first layer of fiberglass."

So to those who coached me to relax, and who said that the bad survey had to do with just being hauled out, and those who said it was a case of an incorrect survey, THANKS! You were very correct. It was all a big scare over nothing. I think someone even mentioned grinding out the little gel coat crazing spots and filling in with gel coat. That was indeed the right fix.

Just wanted to put a happy ending on this story, since it has one.
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