Depreciation

[TheBrumNavy]

Has anybody out there ever had a go at putting together a graph that shows the depreciation curve af a particular yacht ? I.E plotting value / year from new to lowest price.

 

[claymore]

I wonder why you would want to. It would be a difficult thing to do anyway because few people buy a boat and leave it at that - there's normally an assortment of gear fitted which gets upgraded as time passes and I feel this helps to offset depreciation. In terms of capital outlay for the boat itself, Its been my experience that by buying right and looking after things,it is possible to break even or make small gains.

 

[tony_brighton]

A DCF calc would probably be more relevant - and more scary!

 

[chrisc]

Oh, come on guys lets try not be too depressing

 

[tony_brighton]

maybe you're lucky and your boat is appreciating over and above inflation, operating costs etc.

 

[chrisc]

sounds unlikely ...i can think of better investements ,
still i have every intention of turning it into my primary
domicile soonish and for a year or two. might not be
inflation proof but at least I can move it to somewhere warmer .

 

[tony_brighton]

As a serious point - scan through all the back copies of the mags for your model - might give you a view based on asking price.

 

[david_e]

Nearly all boats are different and will depreciate/appreciate accordingly. As a rule of thumb the average amount tends to be about 5% per annum on a new, mass market (if there is such a thing) boat bought in the last 4-5 years. This is how many a broker will calculate it when doing the realistic sums in cold blood.

 

[chippie]

You could find out the allowable depreciation for tax purposes for a vessel in charter. This would not neccesarily have anything to do with private ownership depreciation but would give some sort of benchmark.

 

[Guest]

Possibly best not to ask, but the depreciation will certainly be less than buying a new car every few years. And there is little point paying off your mortgage at present. The money won't do much better elsewhere unless your name is Soros, pension schemes are a total disaster area. You might as well enjoy it and stop worrying about impossible calculations.

 

[Gerry]

Yes. I have put prices from the web into spreadsheets and statistical software to quantify depreciation and look for other significant relationships between length, boat type, make, year, location and price. There is a lot of information available and it is only a matter of the time consuming business of typing the data into the software. Owners of the sales databases could sell the data for this kind of analyses or 'mine' the data themselves and sell the analyses. I wonder why they haven't made a business of it?

Perhaps the published prices are not a good measure of actual prices. Perhaps because consistent data on condition is not there (this has got to account for a lot of the price difference between boats). Perhaps because the major manufacturers (and the database owners' customers) wouldn't like analysis that shows that their boat(s) depreciate faster than others.

Some car magazines provide comparative data on total cost of ownership, e.g. cost per mile including depreciation, fuel economy and maintenance, etc. With more and more data now available on the web, it is only a matter of time before someone offers similar information for yachts.

Anyone interested in exploring this business opportunity with me?

 

[TheBrumNavy]

Is there any chance you could forward some information for yachts in the range of 36- 45 ft. I am, trying to prove a theory that has been wandering around my head for some time, with your help I may just do it.

Email Les_Collier@shustoke.freeserve.co.uk

 

[jfkal]

I think a hands-on approach would be:

Take the purchase value, write it off like a business asset at 5 % per annum. Activate all replacement parts at purchase value. Activate done preventive and corrective maintenanance as good will. This should take care of the effect that if maintained properly a boat can and will keep its value better than a car ).

 

[chrisc]

My cars don't depreciate

 

[jfkal]

Lucky you. Everybody elses do.