Role of asset depreciation in larger (60f) boats

[Bouba]

The old adage springs to mind what they say about fools and money ?= Soon parted springs to mind .

This threads about depreciation of 60 ftr boats and the relative value of buying a used depreciated out lower boat and getting it like you want simultaneously while still using it .
In this case a nice SL 58/62 or similar or a glassed up plastic fantastic latest smaller 50 ftr FB saving circa @€900 k

Whats your advice between theses two .
Factory pic ( see there web site for more ) circa £1.2 Million depending on spec for one of theses below .
View attachment 120518

Or one of theses or similar below £300 K - looks pretty fresh inside not much if anything to refit actually.
View attachment 120519
link here for closer scrutiny =San Lorenzo (IT) San Lorenzo 62 Used Boat for Sale 1995


Oh and invest or do something else with the difference ( the 900 K ) eg buy some more properties or stick it on the markets as an example .
If it’s liquid on the markets return 16/18 % , that’s as I have already said €144 K each year and more if compounded up over a 10 y ownership , more than enough to do it up , and offset any extra running costs .Berthing difference in Liguria the ops location is not that much anyhow .
Hard to see any down sides here , can you ?

Summary Bouba
1- what would you advise and why ?
2- see any down sides ? Do bare in mind the capitol appreciation of the 900 K investment (s)

A smaller new boat can have as much room as a larger older boat. Of course, you can argue that it’s best to buy from a manufacturer when they were at their peak in terms of quality and design. A lot of people view Mercedes this way.
And yes, who doesn’t want 900K in their back pocket!
But a purchase is made after many decisions that are unique to the purchaser. I wasn’t advocating any course of action, just saying that there are pros and cons in everything

 

[Portofino]

A smaller new boat can have as much room as a larger older boat. Of course, you can argue that it’s best to buy from a manufacturer when they were at their peak in terms of quality and design. A lot of people view Mercedes this way.
And yes, who doesn’t want 900K in their back pocket!
But a purchase is made after many decisions that are unique to the purchaser. I wasn’t advocating any course of action, just saying that there are pros and cons in everything

We know all that it’s a given .
The ops post is pretty specific , he s detailed it , this Vs that .
Choose your corner .

As for DAW kindly relating his experience, he had the cash mentally spent already on the 2012 62 , a season was looming and was offered at a quite sizeable discount with warranties a turn key brand newie on his door step .That this vs that makes perfect sense .

So it depends on the deal offered at the time after negotiations and timelines ( DAW ) each this vs that is different .

Getting a demo or cancelled order / stock boat , nearly new that’s physically on the water avoids a lot of potential aggro re builder going bust, or you arranging mitigation via lawyers , missed deadlines , out of stock spec , transport risks - they do fall of ships etc etc .
Its what I would do if wanted a new , not spec one , but buy one physically afloat and sail away and negotiate hard .
If they don’t play ball there are plenty out there .
Sure you can phaff changing the Bimini colour , anchor or indeed add a Passerelle or what ever in your own time .

 

[Bouba]

We know all that it’s a given .
The ops post is pretty specific , he s detailed it , this Vs that .
Choose your corner .

As for DAW kindly relating his experience, he had the cash mentally spent already on the 2012 62 , a season was looming and was offered at a quite sizeable discount with warranties a turn key brand newie on his door step .That this vs that makes perfect sense .

So it depends on the deal offered at the time after negotiations and timelines ( DAW ) each this vs that is different .

Getting a demo or cancelled order / stock boat , nearly new that’s physically on the water avoids a lot of potential aggro re builder going bust, or you arranging mitigation via lawyers , missed deadlines , out of stock spec , transport risks - they do fall of ships etc etc .
Its what I would do if wanted a new , not spec one , but buy one physically afloat and sail away and negotiate hard .
If they don’t play ball there are plenty out there .
Sure you can phaff changing the Bimini colour , anchor or indeed add a Passerelle or what ever in your own time .

I will not choose a side? but my last three boats were brand new ?

 

[n.herring]

No but it might mean that more people have some food to eat and clean water to drink

So you dont think anyone should be able to spend big money on a motor boat, not sure what the people of Poole would think of that when a few thousand are out of work. Wealth distribution works in many ways and someone buying a new boat with big depreciation is one of them. Also gives the rest of us a chance to buy a nice boat at an affordable price.

 

[Bouba]

A small upfront asking price for a boat that is four fifths a superyacht, can be a deceptive way into boating. Unless you know you can feed, water and stable it indefinitely (there may never be someone who will take it off your hands) you should back away slowly.
I was once at Cannes boat show, during a economic dip if I recall, and there was a almost new 125 foot sports fishing boat. On it was a banner saying, the bank is selling this boat at this show please put in a bid (or more succinctly put). I thought of offering ten euros as a joke. But what if I won it? I couldn’t even afford to drive it home

 

[Bigplumbs]

So you dont think anyone should be able to spend big money on a motor boat, not sure what the people of Poole would think of that when a few thousand are out of work. Wealth distribution works in many ways and someone buying a new boat with big depreciation is one of them. Also gives the rest of us a chance to buy a nice boat at an affordable price.

No never said that but I think it is correct to say that all right thinking people know that wealth distribution in the world is all to cock.

It is also quite interesting to remember that the bigger the boat you sit on drinking on the back with a ridiculously large flower display on the table the more you are hated by most who see you. Always makes me smile

 

[jrudge]

No but it might mean that more people have some food to eat and clean water to drink

Says a man who last self reported I think owning 7 boats ?

 

[Martxer]

No never said that but I think it is correct to say that all right thinking people know that wealth distribution in the world is all to cock.

It is also quite interesting to remember that the bigger the boat you sit on drinking on the back with a ridiculously large flower display on the table the more you are hated by most who see you. Always makes me smile

? hate is a bit harsh dont you think? Do none boat owners have similar feeling when they see folk ripping about on a rib?
I think it’s more likely most folk would love to have the big boat with the large flower display, seeing those about may drive someone to succeeded in life so they can purchase such a boat.
They could go on to discover a cure for cancer , invent something to prevent global warming or maybe just the next best drone.
Would you hate that person to then go on and buy a nice boat?

 

[westernman]

Most people in this boating lark I come across have made a small fortune with boats.

They all started with a much larger fortune of course.

 

[Bigplumbs]

Says a man who last self reported I think owning 7 boats ?

Its 11 boats but total purchase price of all of them was about £60.000 so probably the cost of some people’s tender in their garage

 

[Bigplumbs]

? hate is a bit harsh dont you think? Do none boat owners have similar feeling when they see folk ripping about on a rib?
I think it’s more likely most folk would love to have the big boat with the large flower display, seeing those about may drive someone to succeeded in life so they can purchase such a boat.
They could go on to discover a cure for cancer , invent something to prevent global warming or maybe just the next best drone.
Would you hate that person to then go on and buy a nice boat?

yes hate is a little harsh but I think those with the large flower display need perhaps to understand that the sentiment is true, if this has come as news to them perhaps they need some time in the real world

have you ever watched Rich House Poor House

 

[Bigplumbs]

I will not choose a side? but my last three boats were brand new ?

so were mine 3 Itiwit inflatable canoes total cost £850 will have to wait and see what the depreciation will be on those ?

Bought them to go on little canoe trips with her indoors and a couple of friends that are always Skint

 

[prinex]

An argument could be made that in fact some goods (like boats and large yachts in particular) which lose their value very quickly (and needs tons of people to run and maintain) should be incentivated. For example, buy a yacht, deduct some percentage of it from your income tax. You will have a double effect - lots of people get a job in the yacht industry and wealth gets destroyed (which prevent accumulation of wealth by inviduals).

Compare buying a block of flats to rent out or a yacht. After 30 years the block of flat is still there and also generated more wealth for the owner, the yacht will be worth 0 and costed millions - millions that went to people building it, cleaning, repairing and so on.

But even if this would make economical sense, the guy that at the sametime manages to convince the electorate that we should give tax rebate if you buy a yacht and that renting out should be heavily taxed (even if this would drive down real estate prices to sensible levels again) will probably be never born. Specially because the ones that will need it more (people cut off from home ownership due to high prices) are usually the ones that dont go to the poll booth 'they all bastards anyway'.

 

[Bigplumbs]

An argument could be made that in fact some goods (like boats and large yachts in particular) which lose their value very quickly (and needs tons of people to run and maintain) should be incentivated. For example, buy a yacht, deduct some percentage of it from your income tax. You will have a double effect - lots of people get a job in the yacht industry and wealth gets destroyed (which prevent accumulation of wealth by inviduals).

Compare buying a block of flats to rent out or a yacht. After 30 years the block of flat is still there and also generated more wealth for the owner, the yacht will be worth 0 and costed millions - millions that went to people building it, cleaning, repairing and so on.

But even if this would make economical sense, the guy that at the sametime manages to convince the electorate that we should give tax rebate if you buy a yacht and that renting out should be heavily taxed (even if this would drive down real estate prices to sensible levels again) will probably be never born. Specially because the ones that will need it more (people cut off from home ownership due to high prices) are usually the ones that dont go to the poll booth 'they all bastards anyway'.

you make some valid points. But the fact remains that wealth around the planet is very poorly distributed.

As for residential property these are places for people to live in not assets to be used to make money In my view but I suspect many on here may not agree

 

[GravyStain]

No never said that but I think it is correct to say that all right thinking people know that wealth distribution in the world is all to cock.

It is also quite interesting to remember that the bigger the boat you sit on drinking on the back with a ridiculously large flower display on the table the more you are hated by most who see you. Always makes me smile

Bigplumbs, I'm very aware of this thought...

I've driven Porsches for the last 30 years. I could have bought a few Ferraris or Lambos during that time, but the Porkers are far less shouty with equal performance and arguably far higher quality.

I don't say this to brag in any way - there are many people on this forum far wealthier than liitle old me.

My point is that I didn't buy those italian cars because of peoples perceptions of the owner, i.e. rich showoff twat. They do say 'Look at me' rather loudly. I'm certainly not a show off, not am I a shrinking wallflower. I just wouldn't want the attention.

 

[Bouba]

An argument could be made that in fact some goods (like boats and large yachts in particular) which lose their value very quickly (and needs tons of people to run and maintain) should be incentivated. For example, buy a yacht, deduct some percentage of it from your income tax. You will have a double effect - lots of people get a job in the yacht industry and wealth gets destroyed (which prevent accumulation of wealth by inviduals).

Compare buying a block of flats to rent out or a yacht. After 30 years the block of flat is still there and also generated more wealth for the owner, the yacht will be worth 0 and costed millions - millions that went to people building it, cleaning, repairing and so on.

But even if this would make economical sense, the guy that at the sametime manages to convince the electorate that we should give tax rebate if you buy a yacht and that renting out should be heavily taxed (even if this would drive down real estate prices to sensible levels again) will probably be never born. Specially because the ones that will need it more (people cut off from home ownership due to high prices) are usually the ones that dont go to the poll booth 'they all bastards anyway'.

Subsidising boats is something that I have been thinking about for ages. You are right, no Tory could propose it. But Kier Starmer always struck me as a Yacht Squadron man....

 

[GravyStain]

An argument could be made that in fact some goods (like boats and large yachts in particular) which lose their value very quickly (and needs tons of people to run and maintain) should be incentivated. For example, buy a yacht, deduct some percentage of it from your income tax. You will have a double effect - lots of people get a job in the yacht industry and wealth gets destroyed (which prevent accumulation of wealth by inviduals).

Why would you give very rich people even more tax breaks? You'd be voted out faster than Superman folding on laundry day....

 

[Bouba]

Bigplumbs, I'm very sensitive, and aware of this thought...

I've driven Porsches for the last 30 years. I could have bought a few Ferraris or Lambos during that time, but the Porkers are far less shouty with equal performance and arguably far highter quality.

I don't say this to brag in any way - there are many people on this forum far welathier than liitle old me.

My point is that I didn't buy those italian cars because of peoples perceptions of the owner, i.e. rich showoff twat. They do say 'Look at me' rather loudly. I'm certainly not a show off, not am I a shrinking wallflower. I just wouldn't want the attention.

Funnily enough Porkers are associated with Yuppies from the eighties. Ferrari’s on the other hand elicit an altogether different response. They are revered and treated like a celebrity by the public.
Many decades ago I was walking down Wembley High Street and it must have been the Cup Final because the place was full of Scousers. Anyhow, this Indian drove past in his Rolls Royce, the full gold trimmed version. Gold radiator gold Spirit of Ecstasy etc. The Scousers literally stood there with their jaws dropped open. Remember this was when cars in Liverpool didn’t have hubcaps let alone tax discs. Anyhow, one of the Scousers recovered his composure and yelled out YOU P... B....... and pretty soon they all joined in! The Indian driver looked shocked

 

[Greg2]

As for residential property these are places for people to live in not assets to be used to make money In my view but I suspect many on here may not agree

I have been saying this for years. It breaks my heart to see young people struggling to get on the property ladder and the obscenity of ‘dark windows‘ in properties bought as an investment in London, whilst we have a housing shortage.

 

[Zing]

As someone who has bought both new and used boats over the last 10-15 years, I think there are pros and cons to both alternatives and for many people its not just a question of how much each costs. When I look at my history of boat ownership, the new boats have generally cost me more money in absolute terms, but not when you consider maintenance, depreciation and running costs as a percentage of the initial value of the boat.

For me, its not sensible to compare something that is 20 years old with something that is brand new just because they are the same size and have the same number of cabins. A lot depends on what you want to get from boating, how experienced you are, how much time you have and what budget you are operating with. For an experienced boater with plenty of time and enthusiasm, interested in maintenance and projects, and operating on a constrained budget, the older boat obviously makes a lot more sense. However, for someone relatively inexperienced, short of time, or just not interested in dealing with the problems of an older boat and looking for dealer support, and most importantly operating without any significant budget constraints, then perhaps the new boat is a more sensible option.

Also, which boats you are comparing, how old, how much, what work is needed, etc. all make a huge difference to the analysis. As an example ... I bought my current boat (a 2019 Sunseeker Predator 57) brand new because the purchase of a used boat (a 2012 Manhattan 63) fell through due to a failed survey. Having sold my previous 2007 Portofino 53 as soon as it went on the market, I was facing a summer without a boat and so bought the stock boat at a healthy discount to the list price and took delivery almost immediately. The purchase cost of the Predator 57 was similar to the cost of the Manhattan 63 plus the repairs, refurbishments and upgrades I was planning (perhaps 5% more). I have no regrets about opting for the slightly smaller Predator 57 ... its a great boat and I've been very happy with it. Today, two years later, a 2019 Predator 57 is worth 20% more than a 2012 Manhattan 63 and for the last two years while the boat was under warranty I've had no maintenance costs. So does this mean buying new was a sensible financial decision?

You have done well, but the case for new vs old is a bit different right now and you have been lucky. We are in a time of mismatched supply and demand for new boats. In times like this, which history suggests will not last long, the price of nearly new boats like yours is particularly high. Prices are high because that unsatisfied demand from people who can’t get a quick delivery of a new boat goes straight onto the demand for nearly new boats. In normal years you would lose maybe 20% more than you have lost and that’s a very different picture.