10-25% of Boat Cost/Year on Maintenance - That Seems Like a Lot

[Captain Bill]

I would guess that mine will average about 10-15K per year. I do most of the work myself, But I suspect that there are some major things on the horizon now that the boat is 8 years old that will be pretty major. I need a new enclosure for instance, recently quoted at $4000. I have access to a sailrite sewing machine and figure I can do it myself for about $1200. We'll see. I'll probably need new sails in a couple of years, but I won't tackle those myself. Standing rigging looks good, but will be replaced with the sails. That will be pretty interesting. My house bank is still doing well but at 8 years even AGMs are getting a bit long in the tooth. I need bottom paint this year. I get that every three years for a couple thousand. Two years ago I had some saildrive trouble, to the tune of about 4 thousand. Some minor things like a new freshwater pump. Cost me about $500 to build new bow seats when the originals failed. I'm convinced that the ones I built will last longer than 7 years but only time will tell. And of course there's the 1% I put out just for insurance every year. Fortunately I pay about 1% of current value for this. Many companies have offered to let me pay 2-3%, the upper range of which is approaching 1% of the new replacement value. I could easily be paying $7-8000 per year for dockage if I wanted to stay in high or even medium class marinas. I choose a nice out in the boonies marina with few ammenities. When cruising I try to stay on the hook as much as possible, so those costs are lower when I'm cruising. If you stay on the hook most of the time and don't motor everywhere you go I think you can do it for 40K per year as long as you have a good capital kitty for major breakdowns.

[Boracay]

My rule of thumb has been that the total cost of boat ownership can be estimated at 25% of boat market value, plus insurance and mooring/docking.

For this figure I figured on 7% maintenance, 6% depreciation and 12% loss of earning capacity of the money tied up in the boat, using an estimated boat value of $100,000 (mono in good condition used often).

Having had a few large bills recently the 7% may be a little low, as may the 6% depreciation, while in the current climate the 12% loss of earnings is probably a little high.

Of course much larger, or much smaller boats could have very different figures.

But all in all, if an owner figured on 33% of boat value over the ownership period I feel it might be one tool in doing a feasibility study.

[Southern Star]

Boracay, you are of course correct that in any assessment of the true cost of boat ownership one must take into account depreciation and the lost earnings on the capital invested. In this instance, however, I think the original post concerned solely maintenance costs. In any event, that may go a long way towards explaining the higher figures that are sometimes bandied about: they include depreciation (initially, that can be as high as 10% on a declining balance basis), lost return on investment (even now, one would think at least 5%), maintenance and a reserve for capital expenditures ( 2.5% IMO for even the DIY crowd), insurance (typically at least 2%), plus docking.

Brad

[EllanVannin]

Have just done the add up of costs after one full year of ownership. We have always worked on the 10% of your purchase price theory.

Sure enough the total spent in the last twelve months has been just about the ten percent mark. This is of course on a yacht not a cat so that will figure in. Our costs included high daily casual rates at the marina(which accounted for $7500 of the $20,000 spent) , insurance and basic maintenance. Just normal regular maintenance no major refits of rigging, sails, engine etc. We have done 90% of the labour ourselves.

Hope this helps
Regards Clare

[Sparohok]

I don't think anyone has ever claimed 10%-25% of purchase cost / year on maintenance alone. That is a strawman.

I think 10%-25% of purchase cost per year as a total cost of ownership sounds like quite reasonable bounds -- including insurance, depreciation, opportunity cost of money, marina fees, maintenance, etc. Of course it's a pretty wide range so it's easy to hit!

Martin