Re: What To Take Into Account When Considering A 40+ Year Old Sailboat?
Now, with my moderator hat hung on its peg, I did want to take a stab at some of the questions raised in this discussion.
I'll start with the question contained withing Post 29: "What would you say is the max you should expect to spend on improving a sailboat of this type and age?"
There is no rule of thumb on this. The way that I have tackled this is to track a particular make and model that interests me on various boat for sail websites. I keep a log with every boat that is listed, its initial asking price, equipage, how long it stayed on the market, and the asking price when it disappeared from the listings. Its not precise but my assumption is that the sale price was probably 10-15% of the last asking price. I also assume that the condition of the boat relative to its asking price was a lot worse than when it was listed if the boat remained on the market a long time. If nothing else this gives me a very rough sense of the marketplace on that model. That can literally take years to develop on a rarer model.
The next thing I factor in is how long I plan to own that boat and how I plan to use it. If I plan to own the boat for a long time, then I don't mind putting a lot into it over time. I see that as a kind of 'user fee' for something that gives me a lot of joy. (I tend to own boats for a long time and have owned Synergy for 18 years and the prior boat for roughly 13 years)
Before even looking at candidate boats I had made a list of "must have now's", and a timeline of must haves over time. Based on my financial situation, I set a budget in the short run and a budget over time. For example on my current boat, I expected to put 100% of the purchase price into the boat over a 10 year period of time and own her at least that long. That 100% of the purchase price number does not include the cost of normal maintenance during the time that I owned her. But part of that cost expectation came from altering the boat to suit my needs rather than the normal things a buyer should expect on the boat.
In the case of Synergy, she had spent most of her life before I owned her as a race boat. Cruising systems had either not been installed or had been allowed to die and not be replaced. Similarly, Synergy had been raced by a crew between 8 and 10 people. For my use I wanted to her adapted to race and cruise single-hand. I readily acknowledged some of the items that needed to be added clearly were things that any potential buyer would want to have aboard, while others were unique to my needs. Those that were typically expected items, I used to evaluate the fairness of the asking price. Those that were unique to me affected what I wanted to pay for the boat in terms of whether I could afford to buy this boat, but were not taken into account in terms of my offers on the boat.
Speaking generically again, once I identified a boat that seemed like a good candidate I visited the boat, and inventoried what was on the boat vs what I wanted on the boat. I compared what was on the boat to same make and model boats as well as the condition of the boat to sister ships. I then made a list of what needed to be replaced immediately vs long term, including costs to survey and move the boat to where I want to use her, and that helps create the price that I offered, and make a determination on whether I could even afford to make an offer on a particular boat. Also, before making an offer I also determined a maximum price that I would be willing to pay for that particular boat and put all of that in writing since I lime most folks, tend to play games in my mind if I like a boat.
When I make an offer on a boat, I do several things, I include contingencies for a sail trial and survey including all systems, and an engine run survey. I include an inventory of equipment that is understood to convey with the boat and note those items that I specifically believe to be operational, as well as acknowledging any defects discovered before survey that are either baked into the mix, or subject to price adjustment if found by survey to be a major issue. I also include a provision that if defects are found during those trails and surveys, the price can be adjusted up to certain percentage. (That said, when I bought Synergy, the seller insisted the price was his rock bottom price so agreement specifically stated that all I could do with discovered defects was to either proceed with the deal or cancel out. No price ajustment was posible and I accepted that). But more typically, I spell out how the costs of repairing defects will be determined and how the cost would be split between buyer and seller, and the maximum amount that either of us were responsible for and how the payment would be handled. (i.e. the cost estimate might be from a specific boat yard or marine chandlery, and the seller's cost deducted sale price or perhaps the funds escrowed from the closing costs, and paid when the work is done.)
I try to work everything out in a purchase agreement before any serious money gets spent on surveys or launching and hauling.
Unlike some above, I will say that I have made money (sale price exceeded purchase price and cost of upgrades) on a few boats that I have owned (if you don't count my labor fixing them up), but most of the boats that I owned have been at best break even, or cost me something beyond maintenance and operating expenses.
Where it gets tough when looking at 40-50 year old boats is that many of these are truly shot. Many have wildly negative values, meaning it will cost several times what they will ever be worth just to put them into reliably usable condition. Many are completely obsolete designs that are not likely to appeal to anyone other than a very small segment of the marketplace. Many were poor designs when compared to their peers and are especially poor designs when compared some of the better boats that are out there at a similar price range from another later era.
But for any particular seller, they may love their boat and when they think about replacements, there are only a limited number of choices that they can afford and so they set a price that makes sense to them, and there is no way that they are going to move one way or the other. Its like that with my boat. I would not be willing to sell her for a fair price as long as I can sail her and she suits my needs. But when I am done with her, I would probably sell her for small fraction of what I had in her because I doubt that she would have the kind of universal market appeal that might demand a higher price.
In other words, my general suggestion is to be organized about your search and information gathering. Ask the Broker or Seller very pointed questions about the age of photos, last operation of critical equipment, known damage and so on. In the case of a broker, find out he has been on the boat, when and if there have been any recent offers. Make sure to put as much as possible into the purchase offer.
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Curmudgeon at Large- and rhinestone in the rough, sailing my Farr 11.6 on the Chesapeake Bay
Last edited by Jeff_H; 06-10-2019 at 01:58 PM.