Pros and Cons of Owning a Slip...

[MedSailor]

The marinas in the area we live in are about 50% rented slips (what I'm used to) and 50% owned slips. For the first time I've started to give some thought to buying a slip. Why?

1: I'm tired of paying rent and having it go into the black hole.
2: The market prices are slightly down so it might be a good investment.
3: I live on a boat and plan to for a long time. So I don't have to worry about finding renters and if I own, they can't kick us out when they finally decide all liveaboards are scum!
4: I have a good job/income now but really don't want to buy a house.

What are some of the things I should be thinking about? I already know what the monthly owners fees are, and I am soon going to ask my bank about loan options. Any idea how much of a down payment banks require for a slip loan? There are standards for houses and boats, this is neither.

Anyone who owns their slip have any wisdom or warnings to pass on?

MedSailor

[CaptainForce]

in 1990 I received an offer to purchase a 45' slip in Fort Lauderdale for $250,000. That's 60% more than the total amount I've spent living aboard in rented a slip continually since 1971. There would also have been maintenance and association fees. Some rates like this in Southeast Florida are absurd! It can be wise, but calculate the true cost. We're still living aboard, but now we only rent a slip about 4 months out of the year since retiring. 'take care and joy, Aythya crew

[night0wl]

Originally Posted by CaptainForce

in 1990 I received an offer to purchase a 45' slip in Fort Lauderdale for $250,000. That's 60% more than the total amount I've spent living aboard in rented a slip continually since 1971. There would also have been maintenance and association fees. Some rates like this in Southeast Florida are absurd! It can be wise, but calculate the true cost. We're still living aboard, but now we only rent a slip about 4 months out of the year since retiring. 'take care and joy, Aythya crew

I'll bet that same slip has come down 75% in price...as much of the market for obscenely overpriced crap in South Florida has. Even the the media says we are 40% off of peak pricing, I routinely see condos selling for 75% - 80% off of the peak prices...with more sliding on its way according to Fortune/CNN.

If I didn't have my dock behind my house, I'd be looking at dockominiums right now. Although, come a storm, your assessments will be massive.

[jrd22]

My brother and I bought a slip several years ago because just like you we hated paying rent. It's been a good investment for us, the value of the slip has appreciated quite a bit, even in todays economy. We normally rent out the slip for 4-5 months while our boat is gone during the summer and it more than covers our maintenance fees for the year. Probably depends a lot on the area, and the marina, whether it's a good move or not.

[tager]

I would never buy anything where "maintenance fees" are a yearly need. Why should you pay to own something! From an investment standpoint, a slip is a safe bet, it will probably appreciate, and it is extremely unlikely that you will lose everything. However, you would probably be better off if you took your capital elsewhere, even a mortgage is a better investment than a slip, appreciation and risk wise. I think that you would be much better off simply paying the rent and investing your money in something that is more likely to appreciate. Surely slips are overvalued assets. Heck they are "marine grade."

[Superpickle]

Originally Posted by MedSailor

The marinas in the area we live in are about 50% rented slips (what I'm used to) and 50% owned slips. For the first time I've started to give some thought to buying a slip. Why?

1: I'm tired of paying rent and having it go into the black hole.
2: The market prices are slightly down so it might be a good investment.
3: I live on a boat and plan to for a long time. So I don't have to worry about finding renters and if I own, they can't kick us out when they finally decide all liveaboards are scum!
4: I have a good job/income now but really don't want to buy a house.

What are some of the things I should be thinking about? I already know what the monthly owners fees are, and I am soon going to ask my bank about loan options. Any idea how much of a down payment banks require for a slip loan? There are standards for houses and boats, this is neither.

Anyone who owns their slip have any wisdom or warnings to pass on?

MedSailor

That brings up a ? , How many slips are there where your at and HOW many Live Aboards are there.. approx.. do you have many Neighbors ?? Does your Loude TV bother them late at night ? When you Run down the docks at midnight Naked, do they complain ? What about Goats, can you bring a Goat or three aboard ???

[jrd22]

Originally Posted by tager

I would never buy anything where "maintenance fees" are a yearly need. Why should you pay to own something! From an investment standpoint, a slip is a safe bet, it will probably appreciate, and it is extremely unlikely that you will lose everything. However, you would probably be better off if you took your capital elsewhere, even a mortgage is a better investment than a slip, appreciation and risk wise. I think that you would be much better off simply paying the rent and investing your money in something that is more likely to appreciate. Surely slips are overvalued assets. Heck they are "marine grade."

It's a yacht club so you get use of the pool and facilities, not that we ever use them. Necessary evil. The value of the slip has gone up from 36K to 70+K in the five or so years we've owned it and it costs us nothing apart from the lost interest on the cash we paid for it with , so I'm not complaining. Moorage rates have gone from $5-6 per foot per month to over $10 in the same time frame and there are waiting lists at most marinas in the area so I don't see rates coming down in the future.

[AlanBrown]

Years ago I though about buying a slip at a lovely marina on Lake George, NY. I loved the lake and thought I'd never leave such a wonderful place. Three years later I purchased a much larger boat and my interests turned away from the lake and toward the ocean. Seven years after that I was living aboard in Nassau.

The point I'm trying to make is this. If you have no plans to move, or position yourself closer to different cruising grounds, consider buying. If wanderlust is apt to strike you, as it did me, I would caution against tying yourself and your money up in a single, fixed location.

[mhfowle]

I don't know much about buying a slip, but it seems a bit rediculous to pay $100,000???? for esentually nothing. You dont own the dock, nor the water. You're paying for an intangable parking space. Once you factor in maintenance fees and interest, is it worth it? I guess you buy the slip hoping that the future slip market will go up, right??? But does it really appriciate or does the price go up because of inflation?? The whole thing is a little far out for me to understand.

[blt2ski]

Being as Medsailor lists himself in Seattle, a hop skip and jump south of me, I would like to know where the 50% owned slips are? I would put it at about 5%. Altho it is possible that some area's have more than others.........

Reality is, a slip purchase if you find where you want to be, could be an equal purchase into a multi story condo.....ie you just bought the equal to an apartment. If said condo/slip was worth the initial cost, some sort of home owners dues for maintenance etc......they add up to potentially less $$$ output and some appreciation of asset, then it is worth it. Other times, it may be cheaper to rent from the Port of Seattle, ie shilshoal or equal, Port of Edmonds as I do........or some kind of private moorage.

Too many questions with no answers at this time. I would consider one if the price were right, it was someplace I wanted to be for awhile, could get a slip size to meet potential bigger boat in my case, ie a mid 30 vs my hair under 30' boat......

Marty