| New -vs- Used Consider your option of new or | | | | yacht and sell it after 3-4 years, annual |
| used carefully. There are very good values to | | | | maintenance is likely to average around 4%. |
| be had in used boats. More first time buyers | | | | The longer you own it, the more it will |
| purchase new boats, while experienced boaters | | | | increase as things wear out and breakdown. |
| more often buy used. And with good reason. | | | | The first big hit usually comes when an |
| Experienced boaters know that there is better | | | | engine or generator goes bad somewhere |
| value dollar for dollar in many used boats | | | | between 5-7 years. Obviously, if you own the |
| than new ones. They've already had the | | | | vessel this long, suddenly the annual average |
| experience of taking a big hit in | | | | takes a big leap. If you're buying used, then |
| depreciation, along with the high cost of | | | | you have to be prepared for this, whether |
| financing involved in a new boat purchase. To | | | | it's an unexpected blister repair job, or |
| help decide which is right for you, consider | | | | some other problem that's not covered by |
| the following. | | | | insurance. Of course, with a used boat, that |
| | | | fifty or hundred thousand you saved off the |
| When we track the depreciation curve for many | | | | new price more than makes up for "big bill." |
| of the most popular builder's models by | | | | |
| determining the net annual loss in resale | | | | The point is that in compiling averages, over |
| value, we find that the higher the vessel | | | | time we know that costs can be reduced to |
| quality, the sooner the depreciation curve | | | | annual percentages for which an owner should |
| will flatten out. That means that higher | | | | be prepared. For twin screw diesel motor |
| quality boats proportionately loose less | | | | yachts or fishermen, a ten year average will |
| value than lower quality vessels. For the | | | | run around 7% annually. After ten years even |
| above mentioned builders, the flattening out | | | | more. This accounts for all types of |
| usually starts around five years, so that by | | | | maintenance from bottom painting to pump |
| the time a vessel is 6 years old, the annual | | | | replacements and engine overhauls. Moreover, |
| loss of value is only a few percentage | | | | this assumes that there is little or no |
| points. If you truly want to know what the | | | | deferred maintenance, and for a boat owned |
| annual cost of ownership is, add in the total | | | | since new. If you're getting into a used boat |
| principle plus interest to the annual | | | | with considerable deferred maintenance, that |
| operation and maintenance costs. Then, simply | | | | annual average can increase dramatically, |
| subtract the anticipated residual valve and | | | | especially when serious problems gang up on |
| divide by the number of years owned. For a | | | | you all at once. |
| new boat, this can be an enormous sum each | | | | |
| and every year. Perform the same calculation | | | | Get a Survey Marine surveyors universally |
| for the purchase of an 8 year old vessel and | | | | recommend new boat surveys, not just because |
| the cost of ownership comes to only a | | | | they want the business, but because new boat |
| fraction of that of a new vessel. | | | | surveys often turn up as many defects as used |
| | | | boat surveys. Not only can the surveyor tell |
| A general rule of thumb is that a new boat | | | | you a lot about the quality of the boat |
| purchase works out better for the owner who | | | | you're buying, but he can help you get those |
| keeps a boat longer than the average four | | | | problems fixed before you take delivery and |
| years, or at least through the bottoming out | | | | head off warranty problems before they become |
| of the depreciation curve. Obviously, the | | | | problems. See also More on Cores. |
| longer a boat is owned, the less the annual | | | | |
| cost becomes. However, that doesn't help much | | | | Diesel Engine Surveys Diesel engines over |
| as far as residual value is concerned unless | | | | three years old should be subjected to a full |
| we consider the original cost versus | | | | survey. Engine surveys are expensive, but the |
| anticipated resale value. Once we do this, we | | | | cost is nothing compared to the repair costs |
| understand that what they told us was really | | | | you may face. As with any surveyor, seek out |
| true: boats, like automobiles, are not an | | | | the best you can find. Engines over 5 years |
| investment but a major expense. If you plan | | | | old should either have a compression test or |
| to only own the vessel for a few years, or | | | | the injectors pulled and the cylinders |
| you anticipate that there is a chance you may | | | | inspected with a boroscope. See also It's Got |
| have to sell, by far a used boat will be your | | | | Recent Overhauls!. |
| better value. | | | | |
| | | | Yacht Surveyors The way to find the best |
| Gas -vs- Diesel Within the size range of | | | | surveyor in your area is to ask people who |
| 25-35 feet, it is a myth that diesel power is | | | | know and are willing to give you an honest |
| more economical than gas. After about four | | | | answer. Its a mistake to take recommendations |
| years, diesel engines become much more costly | | | | from yacht brokers or others who have a |
| to own and maintain. When a gas engine goes | | | | conflict of interest. Insurance agents, |
| bad, it can be rebuilt or replaced for a few | | | | company claims offices and yard managers are |
| thousand dollars while we measure the costs | | | | in a good position to know which surveyors |
| of diesel overhauls in the tens of thousands. | | | | know their business and who aren't in the |
| Unless one plans to get a lot of use from his | | | | pockets of brokers. If you want a good |
| boat, gas engines are usually a better choice | | | | surveyor, choose your surveyor carefully. |
| for boats up to 35 feet. See also Power | | | | |
| Options, Gas -vs- Diesel - Part II. | | | | The next most important consideration is to |
| | | | make sure that the surveyor has adequate time |
| With used boats, don't make the mistake of | | | | to do his job, along with good working |
| equating low hour meter readings with good | | | | conditions. The surveyor can't do a good job |
| engine condition. For the most part, engine | | | | if he's being hustled by a broker or seller. |
| hours mean little because engines deteriorate | | | | Nor can he do a good job if too many people |
| over time. Engines that are little used, gas | | | | are present on the boat. As the buyer, you |
| or diesel, are often in worse condition for | | | | should accompany the surveyor so that you're |
| the lack of use. Also, don't succumb to the | | | | available to see things first hand. Sea |
| myth that marine diesels last for thousands | | | | trials should be conducted in open water, not |
| of hours. They don't. The average time | | | | restricted waterways. A brief run up a river |
| between major repairs is around 6-7 years. | | | | or the Intracoastal, interspersed with no |
| Or, if you want to put it in terms of hours, | | | | wake zones won't do. If weather conditions |
| around 1500 hours. Marine engines deteriorate | | | | don't permit an open water run, be prepared |
| rapidly in a salt water environment. | | | | to reschedule another day. Its extremely |
| | | | important to give the vessel a good run. |
| Good boats with bad engines can turn out to | | | | |
| be a good buy when comparing price | | | | After the survey, avoid letting a broker rush |
| differentials against a newer boat purchase, | | | | your decision. They all say that if you don't |
| particularly for smaller boats, and boats | | | | sign today, they got someone who will |
| with gas engines where engine replacements | | | | tomorrow. Its the oldest con in the book. |
| are easier. Many buyers find that they can | | | | Surveyors need time to consider their |
| get a good buy in a boat with clapped out | | | | findings, and the survey is not really |
| engines and rebuilding or replacing them. If | | | | finished until he has written his report. |
| you don't mind the trouble, it may be worth | | | | Most surveyors get their reports done in a |
| making the price comparison. If the price | | | | day or two, so give him adequate time to |
| works out, you end up with a boat with new | | | | finish his job. |
| engines, a real comfort to any boat owner. | | | | |
| | | | Purchase Agreements Make sure that your |
| Older Vessels While used boats can represent | | | | purchase agreement allows you to cancel the |
| good value, this is true only up to a point. | | | | deal if the vessel does not meet your |
| The problem with some boats once they get | | | | standards. Include a stipulation that the sea |
| beyond 10-12 years is deferred maintenance. | | | | trial must be conducted in open water for a |
| It is an unfortunate fact of life that many | | | | minimum of two hours. |
| boat owners cut a lot of corners when making | | | | |
| repairs, additions or improvements. This is | | | | If the seller warrants that he will repair |
| particularly true when it comes to | | | | any defects, make sure that you get that in |
| mechanical, electrical and plumbing. While | | | | writing, preferably with a maximum dollar |
| the interior may be beautiful, major systems | | | | amount attached. It is not wise to allow the |
| may have been ignored. On good quality boats, | | | | seller to repair deficiencies himself. The |
| repairs are often done to a much lower | | | | reason should be obvious, but many buyers |
| standard than the original, so that by the | | | | overlook the possibility that the repairs |
| time a decade has gone by, there may be a lot | | | | that the seller makes may not be |
| of substandard maintenance and jury-rigging. | | | | satisfactory. Indeed, they often aren't. The |
| | | | best procedure is to negotiate a dollar |
| On older boats, these problems can accumulate | | | | reduction to the sales price and make the |
| to the point where it is no longer | | | | repairs yourself, even if there is an element |
| economically viable to restore the vessel | | | | of uncertainty as to cost. Of course you |
| when considering the cost of refurbishment | | | | should get cost estimates on deficiencies, |
| versus market value. Nothing can take the | | | | and better still a contract price. |
| pleasure out of boating faster than to get in | | | | |
| over one's head financially by | | | | If you can't get away from the seller making |
| underestimating restoration and maintenance | | | | repairs, at least stipulate in the contract |
| costs. When experienced boaters make | | | | that the repair firm must be mutually |
| reference to repairs always costing double | | | | agreeable to both buyer and seller. What |
| what they think it will, they're not kidding | | | | you're looking to avoid is the shade-tree |
| or exaggerating. Estimating marine repairs is | | | | mechanic who doesn't do the job right. |
| extremely difficult, even for professionals. | | | | |
| And nowhere is the statement, "You get what | | | | Remember that the broker represents the |
| you pay for," more true than in the marine | | | | seller, not you, the buyer. If you want to |
| business. | | | | believe their representations, make them put |
| | | | it in writing. That way you have a contract, |
| Be wary of vessel's with excessive amounts of | | | | not just a sales pitch. |
| deferred maintenance or jury-rigging. After | | | | |
| the survey is completed, ask a yard to | | | | Concluding the Deal Don't be too quick to |
| estimate the cost of repairs. If they can't | | | | condemn an otherwise good boat that has a |
| do it, or are having a hard time estimating, | | | | major problem such as a bad engine. If you've |
| chances are that you'll have a hard time | | | | done your homework and have researched more |
| paying when the bill comes due. See also All | | | | than just a few boats, you know what is |
| About Buying Used and Older Boats. | | | | available and at what price. The old saying |
| | | | that the devil you know is better than the |
| Cost of Ownership In addition to purchase | | | | one you don't applies. If you can get serious |
| price, interest and depreciation, the cost of | | | | defects repaired well within economic range, |
| ownership includes maintenance and repairs, | | | | you'll probably end up with a better boat |
| something owners rarely consider. For new | | | | than the next one you look at. The reason is |
| boats, maintenance is low for the first three | | | | simple: if the problem has manifested, it has |
| years or so. But after three years costs | | | | become known. When you're looking at boats of |
| start increasing significantly. Regardless of | | | | comparable age, chances are those boats are |
| type, major machinery will often require | | | | also well on the way to having similar |
| major repairs in years 5-7. There's a reason | | | | problems. Therefore, the more problems that |
| why warranties expire when they do, and | | | | can be discovered and repaired, the better |
| that's because that's when the breakdowns | | | | off you'll be. |
| begin to happen. If you buy a new 40' motor | | | | |