Boat as an investment?

[freakytiki]

I got very lucky.. Found a 1973 Cal 35 Cruiser.. The owner had just rebuilt the engine ..then his plans changed and no longer want to pay slip rent for it to sit there. I got it for about $2500(he was going to have to fork over $4000 for slip rent) Spent $600 with mechanic ..truing shaft , bolting down and rewiring . This boat had new Blue Sea AC and DC panels sitting around and a Electra San waist disposal and wire and hardware. I spent the summer painting and putting in bamboo floors and added my tikis and she looking good with only $4500 outlay. To me It was a great investment..the pleasure of working on her and hearing that engine start up this week. Now off to cruise around

[Pizzazz]

As a purely financial investment, a boat does not make sense. There are too many boats and too few buyers to appreciate your investment. You can make it into a good investment if you add some externality to it:

- You enjoy the boating lifestyle and you choose to live on the boat. Then you save on rent and it can work out.

- You find a rare boat in good condition that you can later sell as a classic. Think Moody, Hinkley, etc. Same as with classic cars - very difficult to make money reliably and not scaleable

- The boat helps you avoid other expenses, for example instead of wining and dining a girl, you take her to the boat. You typically spend much more on women than on boat maintenance, so it works out nicely with the right girl.

- The boat puts you in a state of mind that allows you to make money elsewhere. So instead of spending money on expensive vacations you spend on messing around with the boat, which helps you be more productive at work. This is a solid investment.

Combine a few of the above and boating seems cheap relative to the value added.

[belizesailor]

Originally Posted by Alex_V

Yep, thats exactly what I am researching. There are always exceptions to the rule. My Tiger 800 (motorbike) is a steadily depreciating asset but once it hits a low point it will stay there, also my TZ250 doubled its used price that I payed 5 years ago.

So where is that sweet spot where you minimize the loss in value?

Ha, my 89 Jeep XJ is so old that its actually starting to appreciate (just a little)! 😎

[Peregrine1983]

I bought my first boat (a neglected C&C 30) on Craigslist for $3000. I put about $4000 into it and a couple hundred hours of labor. It was a beautiful boat when I sold it a year and a half later for $7000. Zero profit, and a major loss if you charge for my time, but I had a lot of fun sailing and restoring her, and I saved a good boat from likely being cut up. Totally worth it!

[KenKo]

A number of years ago Practical Sailor had an article about boat depreciation that might be a bit too general for you, but did show how much boats depreciated vs. boat age. Might be worth a look if you get your hands on it to pick an optimal age range.
Good luck, and as the saying goes: "Buy low and have a couple of drinks before you sell so that you sell high!"

[softdown]

A very reasonable question that I have asked. Perhaps better phrased along the lines of "which boats hold their value better". I didn't read the answers here because I am sure that most pounced on the opportunity to question your sanity.

My suspicion is that older, high quality boats in popular sizes with a deep draft and diesel inboard may fare alright. I bought a '78 S2 that meets that meets those parameters. Went broke fast...which is very easy for me to do. I'm usually a couple thousand from being broke. Hoping for more funds and a recharge in enthusiasm over the winter. The boat needed a very long time for the hull to properly dry out anyway.

[Fence Man]

I can't speak to the depreciation schedule of sailboats, but we sold our last boat for more than we paid, and our current boat is worth quite a bit more than we paid. The first one, we bought for a good price, and didn't spend much on maintenance. (got lucky) Our current boat was in good condition structurally and mechanically, but rough in the cosmetic department. It is worth more because it's in better condition than when we bought it. (This was mentioned early on in the thread) The nature of our business has us staying on the boat quite a bit for work purposes, and that is where the "investment" kicks in for us. So long as we do some sort of business on at least 50% of our trips, (It is a legit 100% of the trips) and can prove it should we get audited, (we can) then 100% of our boat related expenses are deductible as a second residence.

Yes, there are boats that depreciate at a slower rate compared to others or have finished depreciating. What are the sailing version of those boats? I couldn't say for sure, but I suspect that you are on the right track with the parameters you set forth in your last post, based on my late night forays into Craigs List and yachtworld.

I also consider our boat to be an investment in the mental health of my family. A very good investment, indeed.

[CaptainJohn49]

“My*kids*were happy to sail with me when they were little. We sailed all summer long. I felt like we were "at the cottage”" --- "We would ride our bikes down to the marina, where the boat lay stocked and ready for our adventure. No traffic. No overpriced long weekend gasoline. Sure, you could argue that it takes 3 hours to get from Kingston into the islands, but there are stops along the way. The fun started the moment we left the*dock.”

Hamburking I think you got it right. Sailing should be about family and sharing.

[ThresherMan]

The only way I know of to consider a boat, of any size, as an investment was to buy a boat and put into charter with a sailing club (like Club Nautique on the West coast). You have to buy the boat they want, but they pay slip fees and routine maintenance, you get some tax writeoffs, and at the end of a few years you have a paid-up boat to use or re-sell.

[Deltasailor]

Originally Posted by Dockhead

I think this is a sound analysis!

However, if you do the math, you'll see that owning a boat is practically never cheaper than hotels, cruises, or charters!

My Dad used to always tell me -- "If it flies, floats, or f***s -- rent it!"

From an economic point of view, this is absolutely right! But while your wallet may like it, your heart may not always want to be floating, flying, or the other thing, with something rented -- therefore we buy boats!

Good one Dockhead! I think that was a paper headline during the "Profumo Affair"
The fact is even though I have not used my boat for 2 years she is in my mind every day, dreaming of when I return. Worth every penny!

[TheThunderbird]

Better investing in fireworks, even wet ones

[Mike OReilly]

As the proverb goes:

Q: “How do you make a small fortune in boating?”

A: “Start with a large fortune."

[Mirage35]

Based on my own recent experience, you'll probably lose less money if you buy an older boat that someone else has already upgraded.

In my price range I found myself looking at Great Lakes boats, around 35 ft and 25 to 30 years old. The price difference between something that had been maintained and upgraded and something that needed a lot of work wasn't that big - say $15k variation on a $60k purchase.

The boat I bought was advertised at $57k and that's about what I paid. There was another boat of the same model and year advertised in the same location for something like $50k, but it didn't have the $90k in upgrades the PO on mine had done. (Seriously - re-powered, new electronics, new sails, and on and on)

I looked at some other very nice, well maintained, boats, but they still had original systems and would have needed these upgrades soon, and it would have been me paying for them.

So, my point of view, it's still not an investment. But at least look for one where a previous loving owner has already paid for the stuff you're going to need anyway.

[SecondBase]

If you can get a newish, ready to charter Catamaran to the Islands by December 1st you'll likely maximize charter income for this year.

Line it up before you go but there must be a shortage of 40-60 foot cats for charter in the BVI's this year.

Before someone calls this "taking advantage" please consider that Every additional boat, back towards a full fleet, would actually help all of the related BVI businesses who normally benefit from season.

IMHO I'd call it a morally correct action to spend your touring dollars in the BVIs, Carib islands in general and the Keys this next 12 months.

[Hhew]

Originally Posted by Pizzazz

The boat helps you avoid other expenses, for example instead of wining and dining a girl, you take her to the boat. You typically spend much more on women than on boat maintenance, so it works out nicely with the right girl.

In this case, boat maintenance can be an investment. If the rig comes down during your romantic evening sail, it'll be expensive mountain vacations for you for the remainder of that relationship!