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Old 11-01-2018, 13:07   #1
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Financials of buying an older boat

First of all I realize that talking about "financials" and "boat buying" in the same sentence may be the ultimate oxymoron. And it may even be a worse association when discussing the purchase of a 25 or 30 year old boat. Being that as it may and if I'm not being too nosy I'd really like to hear about the "numbers" from folks that bought an older boat (particularly a cruising boat) kept it for 10 or more years then sold it.

1. What make and year boat did you buy? How long did you keep it? When did you sell it? What did you buy it for, and what did you sell it for?

2. Was the boat in good condition or a "project" boat? If a "project" boat how much did you put into it to bring up to speed?

3. How old were when you bought the boat?

4. During the time you owned the boat what refits did you do, and more importantly what refits were needed because of the age of the boat (versus the age of the system you were upgrading).

5. Lastly, would you do it again (particularly do you wish you'd bought a newer boat)?


TIA

-Jim
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Old 11-01-2018, 13:15   #2
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Re: Financials of buying an older boat

Every old boat is unique. Why do you want this info?
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Old 11-01-2018, 13:26   #3
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Re: Financials of buying an older boat

15 year old production boat in very good shape cost 20% of purchase price to bring up to my standards. Half of the was seacocks and the rest mechanical. Still have 15 year old electronics and sails that will be upgraded next year.

Cheers, RickG
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Old 11-01-2018, 13:29   #4
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Re: Financials of buying an older boat

I am still in the planning stage for a same age boat you're mentioning. Doing quite a bit of my homework - and now supported by my better half who has a different perspective (galley+upholstery!) a few things:

#1: There are some complete showstoppers I'd avoid (as not being a boat builder/refitter), single items that cost more, than the boat value: Old teak cover screwed into (possibly wet) cored deck, osmosis, requiring a peel

#2: There are smaller items, which you might consider as a deal for a lower price: old sails, even a bad engine (though that's a pricey one), need for a repaint, new headlining (other pricey item!), missing cabin heater - more combined add up to my "walk-away-limit"!

#3: well kept boat, where you add a set of new batteries (500$?) a new solar panel (other 500$), replace a sail (1k$), add some new electronics (2k$) and sail away. I think this is the way to go, there are definitely boats out there, which don't need more than 5k$ - while others will sink and burn (sorry, in reverse order, burn before then sink) a cable away from the marina.

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Old 11-01-2018, 13:31   #5
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Re: Financials of buying an older boat

Quote:
Originally Posted by jimp1234 View Post
First of all I realize that talking about "financials" and "boat buying" in the same sentence may be the ultimate oxymoron. And it may even be a worse association when discussing the purchase of a 25 or 30 year old boat. Being that as it may and if I'm not being too nosy I'd really like to hear about the "numbers" from folks that bought an older boat (particularly a cruising boat) kept it for 10 or more years then sold it.

1. What make and year boat did you buy? How long did you keep it? When did you sell it? What did you buy it for, and what did you sell it for?

1979 41 Morgan Outisland - Just bought and still own. Paid $20k


2. Was the boat in good condition or a "project" boat? If a "project" boat how much did you put into it to bring up to speed?

It's a project boat. Hull structure is good and I sailed it from Fort Myers to Jacksonville last fall (after Hurricane Irma missed it). Most of the systems will be replaced either due to upgrade/modernization or previous failure. I'm assuming I'll put somewhere close to $40k in refit and upgrades.

3. How old were when you bought the boat?

47

4. During the time you owned the boat what refits did you do, and more importantly what refits were needed because of the age of the boat (versus the age of the system you were upgrading).

I've painted the aft cabin (living area) and started refurbishing the helm station and diesel engine. Only been focused on projects in the last 30 days.

5. Lastly, would you do it again (particularly do you wish you'd bought a newer boat)?

My day job has me in front of a computer all day so the projects are a form of therapy. Buying this way also allows me to live on the water sooner and "pay as I go" vs saving more to buy a boat closer to "ready to sail". In the end I think money spent will be the same at the end.

TIA

-Jim
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Old 11-01-2018, 13:56   #6
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Re: Financials of buying an older boat

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Originally Posted by jimp1234 View Post

1. What make and year boat did you buy? How long did you keep it? When did you sell it? What did you buy it for, and what did you sell it for?

1998 bought a 1986 boat. At half the price of a new one! Still own it.

2. Was the boat in good condition or a "project" boat? If a "project" boat how much did you put into it to bring up to speed?

Pristine, but still had to do a complete electrical upgrade to abe able to anchor out instead of being plugged in all the time.

3. How old were when you bought the boat?

53

4. During the time you owned the boat what refits did you do, and more importantly what refits were needed because of the age of the boat (versus the age of the system you were upgrading).

Other than the DC electrical system (charging, inverting), the usual: rigging both standing and running, blocks, traveler controls --- all of which could be considered maintenance.

5. Lastly, would you do it again (particularly do you wish you'd bought a newer boat)?

Yes, and no I liked the older boats better even though they were still making them. I couldn't justify twice the price for the same boat. Twenty happy years later, my boat is 30 years old, their's are still 20 years old and have the same maintenance issues I had: hoses, HX, exhaust hose and riser, muffler, etc.
Jim,

I agree with Rick and given the other answers, can't for the life of me figure out how this info would help anyone else.

We all have different interests and aptitudes for purchases and ability and/or interest to repair things. We all have different financial issues.

There are also sooooo many different damn boats out there, some still being made, in one variant or another (my C34 has been replaced by the C355, same layout 30 years later) that it would be appreciated if you can expand on the whys of your questions. Many folks who ask them do do so. Thanks.
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Old 11-01-2018, 15:49   #7
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Financials of buying an older boat

Bought a 27 yr old IP three years ago, Boat was completely unequipped, I have added everything from generator, Watermaker, all electronics including Autopilot, windlass, chargers, battery banks, chainplates, rigging, new sails, list goes on and on.
I have likely as much in the boat as I paid for her, but now everything except the engine and tanks is new, and all of it is the exact equipment I wanted.
I have a friend with a much newer, bigger and at least as high a quality of build as I have, and yet many of his systems seem to be problematic and of course they are not new, yet I’m sure he has way more money in his Boat than I do, but less work.
However I expect to have way less trouble with my systems in the next five years for two reasons, first I was able to spec it all, and I bought the highest quality “stuff” I could find, and second I installed all of it, wiring etc., so except for not being able to remember due to age I should know right where everything is come time to repair, and I went out of my way to make all of it as accessible as possible

Money wise, I have in my financial planning, planned for the Boat to have no residual value for two reasons, first I don’t think it will have much, cause in ten years, she will be fourty years old, and secondly I plan on keeping it even after we move back to shore for as long as I can.

Value wise, I don’t think in truth that I have increased the value of the boat by much more than 10cents on the dollar for the money I have spent
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Old 11-01-2018, 18:29   #8
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Re: Financials of buying an older boat

Hi guys,


First of all thanks for the responses. I apologize for not being clearer with my questions. What I'm trying to figure out is the "dollars and cents" of buying an older boat versus a newer boat and I thought a survey might help with that. I'll give it another try with hopefully a more concrete example. So let's say my boat purchase budget is $200k. A quality blue water cruising boat circa 1990 (27 years old) for that price might be 45 - 50 ft. LOA. A boat circa 2000 (17 years old), a quality boat as well, is going to be a smaller boat maybe 35 - 38 ft. And for this example let's say the refit required for both boats is going to cost the same dollar amount. And btw, I realize there a host of other factors to consider but I'm trying to keep this comparison simple. Now I'd prefer the 45 ft cruiser but could I make that 38 ft.boat work? Probably. So does it make more financial sense to purchase the newer boat because it will likely have more residual value after 10 years? Or is that the wrong way to think about a boat purchase? As "64pilot" suggested maybe just figuring on a $0 residual value is a better way to think about it. Just get the boat you want then a Viking funeral? <grin> TIA


-Jim
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Old 11-01-2018, 18:56   #9
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Financials of buying an older boat

Unless going for a short time, like a couple of years, I wouldn’t figure the boat being worth much when your ready to sell.
If for only a couple of years, contrary to popular belief I’d still buy an older, but well thought of Boat that has a following, so that it would be easier to sell, older cause it’s likely to be close to being depreciated out, meaning of course it won’t drop much in value.

I want to be clear though on my boat as an example, except for chainplates, sails and rigging, nothing else was really refit. The money I spent to outfit my boat would have been the same if she was brand new, I was adding equipment she never had, not replacing old with new.
I bought an older Marina Queen that had obviously not been sailed or even used much, and wasn’t equipped even with the most basic cruising gear.
I used to always buy new stuff, figuring cause I over maintain equipment that I can keep it almost forever, sold my 2001 truck a year ago to go cruising for example, however in the last ten years or so I have sort of discovered used automobiles etc. Very good, well maintained low mileage ten year old or so cars are out there, you just have to look, and you can buy them for very little money and still drive them basically trouble free for another ten years.
Same for aircraft, and boats.

From what I have seen on this forum, new boats come with no equipment, not even HVAC units, those are purchased separately, and seemingly at insane prices, so a new Boat needs fitting out.
Now if you were in the position to pay cash immediately, and watched closely and have the word out, every now and again very expensive newish boats come up for sale cheap, but you have to be able to pay now, owner is in need of immediate cash.
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Old 11-01-2018, 19:02   #10
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Re: Financials of buying an older boat

Basing a purchase decision on an estimated resale value, some unknown number of years in the future is kinda silly IMO. There are so many variables in the equation that you can skew the outcome any way you wish, making it pretty meaningless.

I've tried to make such decisions on the basis of buying the boat I want to have now. I'm not quite as gloomy as A64, in that I think it will have some residual value, but I don't put a figure on it, and I realize, as most of us should, that it COULD be zero. Boats ain't an investment... you are paying for fun and a lifestyle, and maximizing those factors are more important than recovery dollars at the end... at least for me! However, if you buy a decent (not new) boat and maintain it properly, the loss should not be so very great. If buying new, there is an inescapable depreciation as you sail from the brokers dock.

As far as older vs newer, those numbers are far less important than how the boat has been maintained and improved over her lifetime. Condition of the "bones" comes first, then the consumables like sails, engine and rigging, and only last the add-ons like electronics, watermakers, etc.

In the long run, succumbing to boat lust is always gonna cost you... in blood, sweat, tears and some cash too. But ya know what? It's worth it!

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Old 11-01-2018, 19:10   #11
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Financials of buying an older boat

Jim, I don’t think my boat will be valueless, unless I sink her or she burns or something.
Just in my financial planning, some assumptions have to be made, and trying to decide on what my boat will bring in ten years is a fairytale, it as you say can vary widely on the economy for instance, so I therefore assumed it to be zero, cause basing my Retirement on what I think my boat may be worth when she is 40 yrs old, is in my opinion a fools game
As it is, the whole thing is a gamble anyway, who knows what will happen with the Stock Market etc?
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Old 11-01-2018, 19:14   #12
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Re: Financials of buying an older boat

Get the older 45, if it has been maintained and upgraded well, especially the engine. Original build quality and maintenance/upgrades are far more important than age alone in boats. That is where the "residual value" lies. I got my 29', 55 year old boat for $4k and I haven't put too much into her that she ABSOLUTELY needed except for a new VHF and bow light and a mast support arch I had to build. Now as for what I would LIKE to get... need big bucks. She cost a little under $10K when she was new in '62. I have never lusted for a newer boat, or any boat based on its age. I have lusted for older boats though!
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Old 11-01-2018, 19:19   #13
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Re: Financials of buying an older boat

If you’re looking to “loose less” go older.

Depreciation is rapid at first and slows down. So a newer boat will depreciate faster.

A new boat will loose up to half its value over the first 5 years. After 10 it may be worth 45% after 20 35% after 30 25% after 40 20% after 50 18%
(JUST FOR VISUAL! Not real numbers)

Pick a known boat. If you pick something people have heard of it will be easier to sell.

Be realistic with your tolerance of work. Will you be replacing things or will a yard? If you’re resourceful you can refit a boat inexpensively. If you’re not you’ll be broke.

Know what’s expensive!
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Old 11-01-2018, 19:28   #14
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Re: Financials of buying an older boat

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Originally Posted by Jim Cate View Post
Basing a purchase decision on an estimated resale value, some unknown number of years in the future is kinda silly IMO. There are so many variables in the equation that you can skew the outcome any way you wish, making it pretty meaningless.

I've tried to make such decisions on the basis of buying the boat I want to have now. I'm not quite as gloomy as A64, in that I think it will have some residual value, but I don't put a figure on it, and I realize, as most of us should, that it COULD be zero. Boats ain't an investment... you are paying for fun and a lifestyle, and maximizing those factors are more important than recovery dollars at the end... at least for me! However, if you buy a decent (not new) boat and maintain it properly, the loss should not be so very great. If buying new, there is an inescapable depreciation as you sail from the brokers dock.

....
It isn't that hard to put a residual value on a cruising boat you are purchasing. Sure, there's a million possible variables that could affect it. But that is true for most any other asset you might have -- the stock market, bitcoins, investment real estate, home real estate. That doesn't stop you from using a best guess and making some decisions based on it. You can't plan the future with facts, only assumptions and starting points.

I've seen million dollar boats that were so purpose built it is really unlikely that you'd even find another buyer. On the other hand there are boats that are popular, that have stood the test of time, that appeal to a decent sized market, and putting a reasonable value on their residual value is not an unreasonable planning tool. Betting on some high dollar outcome would be unreasonable. Planning on receiving some percentage of the purchase price in 5 years makes sense. On a decent quality boat it makes more sense than saying it will have no value.
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Old 11-01-2018, 20:11   #15
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Re: Financials of buying an older boat

Quote:
Originally Posted by jimp1234 View Post
First of all I realize that talking about "financials" and "boat buying" in the same sentence may be the ultimate oxymoron. And it may even be a worse association when discussing the purchase of a 25 or 30 year old boat. Being that as it may and if I'm not being too nosy I'd really like to hear about the "numbers" from folks that bought an older boat (particularly a cruising boat) kept it for 10 or more years then sold it.

1. What make and year boat did you buy? How long did you keep it? When did you sell it? What did you buy it for, and what did you sell it for?
I have just purchased a 1975 Morgan 25. I anticipate keeping it for 3-10 years. I have purchased it both as a "starter" cruising boat to learn on and as a boat that is the ideal size pocket cruiser, trailerable, and suitable for use on lakes and rivers where it is a practical necessity to launch/retrieve the boat and step/unstep the mast unassisted.

I will sell it when I've done what I want to do that can only be done with a trailerable boat, and when I'm ready for longer cruises to more remote areas that require something larger and more seaworthy.

Quote:
2. Was the boat in good condition or a "project" boat? If a "project" boat how much did you put into it to bring up to speed?
I purchased the boat, trailer, an outboard motor, and things like PFDs, dock lines, and galley supplies, for $5800. The boat itself is well found, as is the outboard motor. It hasn't been sailed much, and it's a simple boat that lacks things like an inboard, or refrigeration, or shore power, or an inverter, or much in the way of teak. Thus, less to go wrong. On the other hand, the trailer needs work, but that's not a big deal.

Quote:
3. How old were when you bought the boat?
I am 52. This is not my first boat, or boat motor, or trailer, though it is my first sailboat. I specifically set out to find a boat that would fit my needs that is not a project, and that would have a low total cost of ownership.

Quote:
4. During the time you owned the boat what refits did you do, and more importantly what refits were needed because of the age of the boat (versus the age of the system you were upgrading).
There will be a refit of the thru-hulls. I'm anticipating an LED lighting refit at some point, and some sort of refit to the existing propane system for reasons of safety. This may involve either a new propane system, or a replacement of the galley stove with an alcohol stove. I may add a PV panel or two for convenience, so I don't have to charge batteries.

All really minor stuff. I don't plan to change the motor, or to change the ordinary non-furling jib, or to turn the boat into anything more than what is now. Instead, I'll set those funds aside for my next boat.

Quote:
5. Lastly, would you do it again (particularly do you wish you'd bought a newer boat)?
Check back with me in 5 years.
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