When you "buy" a slip, what are you really buying?

[sailcrazy]

following, as we're considering buying a slip in a private marina here in USVIs

[CaptTom]

I looked at it from a slightly different angle.

I bought my "slip" (actually, membership; see above) based on several variables. Cost to buy vs. rent, years to break even, and how long I planned to stay there. Once I hit that break-even date, the rest would be gravy, even if the whole place sunk into the ocean.

I've been there longer than my break-even date, so I'm into the "gravy." Plus, it's now worth at least what I paid for it at the peak of the real estate market. I'm ahead of the game, financially, even if it were worth nothing tomorrow. But chances are much greater that, even if the club dissolved and the assets sold, I'd get most if not all of my investment back.

One caveat: the club is well-run, and we keep up with maintenance. There have been no special assessments, and we've taken steps to ensure there shouldn't be in the foreseeable future. Obviously that's not true with every facility.

So, do the math and estimate the risk. If it works for you, go for it. If not, rent.

[tekdiver]

This is why my boat is on a trailer!

[home builder]

Your essentially buying the privilege of docking your boat in that slip as long as you pay your maintenance dues and all other associated costs every year. I'd look into how the marina ownership is set up as other posters have suggested.

[Cheechako]

Originally Posted by Jdege

When you buy a house, you have title to the land and the building on it. When you buy a slip, you don't get title to the bit of water between the finger piers.

What are you actually buying?

That's the way I've always felt. BUT, I have seen the price of slips go up and up for many years. The reality is you can buy that "nothing" ...use it for 10 years , and sell that "nothing" at 100% profit or more. ie: no moorage cost and a profit to boot!
I helped move and sell a derelict boat from a slip a few years back. The slip owner had the slip sold immediately with others wanting it too.

But if you think about it, why is a view home a million and non view home less than half? Same thing, you are buying even less than water, you are buying "air"!

[CaptTom]

Originally Posted by Cheechako

...The reality is you can buy that "nothing" ...use it for 10 years , and sell that "nothing" at 100% profit or more. ie: no moorage cost and a profit to boot!

Well, in most cases there will be a maintenance fee/condo fee/membership dues or whatever they might call it. If major, unplanned work is required, there might be special assessments, too.

Since I'd be otherwise be spending money on slip rent anyway, for me it was a simple matter to calculate the break-even point. Since I'm well past that point already, anything I can sell it for someday is pure "profit." (Just don't tell the tax man that!)

[Zzmeyer]

You can get a mooring ball in Avalon on Catalina Island for a fifty foot boat for $500,000. Of course, you also have to pay an annual maintenance fee and, no, you do not get any of the fee that is earned for renting it out when you are not there.

[Flatsflyer]

In Florida when I purchased my condo, there where two seperate associations one for the condo and one for the pilings and dock. The lift is my personal property. Power pedestal and dock box are owned by the marina association. The submerge land under my lift is a perpetual lease from the State of Florida. So my dock is recorded in my name and I pay taxes every year. We have 39 condos and 15 slips, slips can only be sold or rented to one of the 39 condo owners. We pay a monthly maintenance fee which covers water, electric, insurance and maintence. Our monthly fee is $37. paid to the not for profit marina association, in November I get a tax bill for about $80. If I want to sell the dock, it is a seperate transaction, as I don't have to sell the condo, only drawback is if I want to sell condo and new buyer doesn't want the dock, I could pass on the sale or be stuck paying monthly fee until a resident wants to purchase it. This arrangement has been in place since 2006 and has worked well, nobody has pushed to change condo docs or rules and regulation.

[captndale]

I own a slip in Racine, Wisconsin on Lake Michigan. It is a condo and all the piers are owned in common. Because a person cannot own a portion of the waterway, the actual real estate is a square of the concrete river walk that runs along the water's edge. That square of concrete is all covered by a city easement but I pay real estate taxes on it. ($125 last year)