Cruising Boats: Three Routes Forward

[Jim H]

Seems like for many (not all) of us, there are three routes forward concerning cruising boats.

1) Stay with the boat we have, which may be paid off, but is likely smaller and older than we would like to cruise in. Benefits: known quantity, bigger cruising kitty, possibly less expensive over time (because of smaller size and age), likely less comfortable, but ready to go on short notice (in case job changes in next five years).

2) Order a new boat, sell current boat, make payments for 3-5 years, end up with a much newer, somewhat larger cruising boat. Benefits: newer design, gear, hull, sails, warranty. Likely less maintenance cost for first years of cruising. More comfortable. Better resale value in future. Possibly much smaller cruising kitty. Possible longer wait for cruise (at least until boat paid off, or nearly). Possible financial mistake to invest so much net worth in a boat.

3) Buy a larger, used sailboat, but sell current boat. Benefits: more comfortable, and possibly more safe if well designed. Most likely it won't be ready to cruise, some or a lot of rebuild may be necessary, depending on age or condition. 1-2 years of work and rebuild investment needed, adding up to a third to one half of purchase price. Somewhat larger cruising kitty compared to new sailboat, but more chance of maintenance issues in first years of cruising. Worse resale outlook, since most of rebuild investment won't be recovered.

As far as I can tell, Sailnet members have gone all three routes. I think we've had fewer new boat cruisers, and more large boat owners, but also the time frame for most here have been pretty long (or still in progress).

One question: the more I look at older, larger boats (40 to 46 feet), the more I become concerned about rebuild and maintenance costs. Large boats come with large costs, and in some ways having a new or newer boat might dodge some of the bigger risks (of time and money and resale).

The other thing that concerns me is having a big boat while also just living and working. If one isn't ready to cruise, having even a new boat mostly sit in a marina or on a mooring for 3-4 years doesn't make sense, but the discipline to save up a couple hundred thousand for a new boat (cash on barrel) and buy it just before departure seems pretty tough, especially given the need for a cruising kitty...

Anyway, that's the ramblings for this morning...

[xort]

I think you underestimated the depreciation of the new boat.
The fourth plan would be to buy a 5 to 10 year old boat that has suffered the depreciation hit but not the wear and tear yet. Problem there is that most of them are way overpriced! Now is probably the best opportunity to find such a boat in a distress sale.

[sailingdog]

Xort's point about the depreciation is an excellent one, and one you'd be foolish not to consider.

[norsearayder]

if your idea is to have the largest boat possible then buy new as that will keep you from cruising for some time if that is your real goal.if u want out of the race then go with what u have as soon as economicly feasable...many people have not a clue as to how to manage life without a job,finacialy as well as mentally

[US27inKS]

Agreed. Let someone else buy the cruising boat of your dreams, take a few years depreciation while rarely leaving the dock, and sell it for cheap. I ran across the boat I would buy if I won the lottery the other day. Normally a 2 year waiting list, and I've only seen 2 others come up for sale in the last 5 years. This boat is 1 year old, made the trip from Canada to Tampa and was parked. 100K off list price, and the best bonus for lottery winners; no wait.

[eryka]

Plan #5: rethink "larger=more comfortable" assumption. That lets you focus on somewhat smaller, somewhat newer, somewhat cheaper boat and still have enough of a cruising kitty to go sooner.

At least, that's what we decided. Met with our financial advisor last Friday and he said we're on track to GO next autumn, yeah, even in this economy The down side is that the boat doesn't have a spare cabin for friends to come for long visits while we're in exotic ports. Hmmm, or maybe that's another up side.

[rayncyn51]

Agree totally with Eryka. Boats are like computer hard drives, in a way. No matter how big it is, you'll fill it up and tell yourself you need a bigger one.

[NCC320]

Recheck depreciation....

Buying new is good to get latest developments. Buying 5-10 yr. old is an excellent way to get most of the latest features without paying the current new boat price.

But depreciation, as far as I can tell, having had 4 new sailboats (22-32 ft.), is not really a factor if you are considering buying new. When one looks at the price of a 5-10 yr. old boat and determines that, for the same model, a new one is a lot more expensive, that is price escalation or inflation that you see, not depreciation. Do your homework and check to see what the original owner of that 5-10 yr. old boat paid for it. In most of the cases that I've seen (following the resale value of my boats), the price that is being asked for the 5-10 yr. old boat is close to what the buyer actually paid for it. Therefore, depreciation, which is the decrease in the value from what the original purchase price was for that particular boat, is not a big factor. Depreciation is not what you would have to pay to get a current new boat over the price of the 5-10 yr. older boat.

If anyone is not buying a new sailboat boat because of suspected high depreciation in the first few years, you are making a mistake.

I have also a 19 ft. motor boat and depreciation based on book/resale value vs. original cost does seem to be significant for motor boats, probably due to fact that those boats take more of a beating and the engine (a large part of the cost) runs all the time and wears out.

[Faster]

I'd not be comfortable with your "wait till you're ready,buy new and go"... I think a couple of years experience with any boat is important before heading offshore - they all need some tweaking, added gear, and you need time to sort out how to handle her in a variety of conditions.. preferably with bailout plan to begin with.

[CaptainForce]

Jim H, I bought a new boat in 1973 and kept it for 12 years. I bought a 1973 boat of the same make, but larger, in 1985 and I have it still. I always had a list of wants and projects while owning both vessels and I still have wants and projects,- for me, the used boat was the better buy. 'take care and joy, Aythya crew