Equipment Depreciation

zaldog · #1 (**permalink**) 03-30-2007

Anyone have a formula for equiptment or upgrade depreciation. I am looking at a 1978 Bristol 29.9, the curent owner has a shopping list of upgrades that he did 5 to 7 years ago that include.

winter cover 2003-4
new port lights and fule lines
new gps chartplotter ( garmin 215) new Simrad wp30 auto pilot 2002
AWL Grip entrie vessel 1999
Rebedded entire deck 2001
New V Birth Cusshions 2003
mainlsail Full batten 2000
150 genoa 2003
Bimini Cover and frame 2001
Crusing Cool Dock Side AC 2002 (which I would hardly ever use being that I will be on a can in Monroe Harbor.

The list goes on to the tune of $19,259.00 that was done 5 to 7 years ago.

The overall condition of the boat is very good. The Original 18HP Yanmar has 656 hours on the engine meter stated to be true.

My question is what is this work/equipment worth now, how much does it add or subtract from the base value of the boat. I want to make an offer on this vessel and am trying to figure how much to offer. I am working through the sellers broker. Thanks in advance for any ideas or suggestions.

Sequitur · #2 (**permalink**) 03-30-2007

I would suggest that it is now fully depreciated.

Guesser · #3 (**permalink**) 03-30-2007

Deprecation is done, unless you're running a business than you might be able to squeak a few more years out of it for tax purposes, but otherwise, the upgrades really do not add any value. I'd offer 20-25% less than asking, which I'm guessing is around $28-30K and then find a middle ground that you can both live with.

zaldog · #4 (**permalink**) 03-30-2007

Your correct deprciation is not the correct term here. Values is. Thanks for the input Guesser.

camaraderie · #5 (**permalink**) 03-30-2007

Well... I would not say there is NO value there. the Awlgrip if in good condition is certainly a plus and the Garmin has maybe 20% of original value since the prices have dropped so much. Ditto the Simrad. Everything else on your list either seems to be standard maintenance (port lights, fuel lines, deck bedding...none of these are upgrades...they are FIXES) or upgrades that have limited life and value at this age...sail, cushions, bimini. None of these are anything special and one would EXPECT them on a used boat.
Less than 20 original engine hours a year is quite extraordinary...but lack of use can be as bad as too much use.An engine survey after your offer will help clarify that.
Take a look at the asking prices on line for similar vessels and then ask the broker for a PRINTOUT of actual selling prices for this model in the last 2 years. This should give you a good range for your offer based on the overall condition of the boat. It is nice that the PO invested in the boat's maintenance...at least until several years ago (why nothing since then???)...but it aint something you have to reimburse him for.

sailingdog · #6 (**permalink**) 03-30-2007

It depends if those things are in good condition or not...more than the age of them. A paint job done last year, but without proper prep work is worth far less than a paint job that was done four years ago with really good prep work. But Cam's point about a lot of that list being "routine maintenance and upkeep" is pretty spot on.

Some of them will have some value left, others will be past any added value to the boat, since they will soon need to be replaced or redone.

cardiacpaul · #7 (**permalink**) 03-30-2007

While its nice that the PO keeps decent records, it doesn't add any "value" to me. The things mentioned would have either been maint. items or given the age be done again anyway.

The low hours on the engine isn't a big concern but low hours are almost as bad as really high hours. Have it checked out.

sailingdog · #8 (**permalink**) 03-31-2007

Actually, CP, IMHO, low hours are probably worse for an engine than high hours with proper maintenance, since most people go by engine hours for the engine maintenance schedule, and the high hour engine is going to be checked more frequently with proper maintenance.

cardiacpaul · #9 (**permalink**) 03-31-2007

dog, agreed... a fellow I know was bemoaning that he had to change his fuel filters.... he said they only had 20 hours on them... installed in 2004

sailingdog · #10 (**permalink**) 03-31-2007

Quote:

Originally Posted by cardiacpaul

dog, agreed... a fellow I know was bemoaning that he had to change his fuel filters.... he said they only had 20 hours on them... installed in 2004

I'm guessing... that he doesn't take the boat out much... I have that many hours on the tiny outboard on my boat..... but I sail as much as I can... and try to spend as much time down at my boat as possible.