When does a boat become 'old and uneconomic'

GrahamM376 said:
One of the drawbacks of living aboard away from home is that pressure is brought to bear not to do some of the smelly jobs, such as sanding off and varnishing. Maybe you have price figures for new boats Bav, Benny, etc. from 13 years ago. At that time, we paid £66,000 for the 376 and could have bought a new basic boat for a similar price. We've since spent approx £20,000 (new engine, windlass, radar, gantry, dinghy and outboard, solar, chart plotter, heater etc) but most of those costs would also have been add-on costs (except the engine) for a new boat. Our boat is worth (judging by recent sales) £45 - £50k but, how much would the new boat be worth now, had we bought one 13 years ago?
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My new Bavaria 37 cost just under £90k equipped to a very similar level to your boat in 2001. I spent virtually nothing on it, apart from new sails and a new saildrive plus normal maintenance and sold it in 2015 for £43k. So, just about evens. I have ignored the income from 7 seasons of chartering which more than paid for the "depreciation".

Your depreciation and replacements/upgrades comes to over £40k over the same period as my £45-50k, and I had the pleasure of a new boat! Hope for much the same, if not better for my new boat (assuming my reconditioned heart and new kidney last as well as the medics say they will).
 
Interesting stuff guys!
My original post was partly brought on as I was doing my record of jobs done and money spent last year ( I have a sailing partner) It seemed quite a bit but I did realise that a lot of work and new items
bought related to things which were not really anything to do with my boat being 40 years old but, rather, were the sort of items which might only last a few years on any boat or which would be 'extras' on most off the shelf new boats.
 
Tranona said:
My new Bavaria 37 cost just under £90k equipped to a very similar level to your boat in 2001. I spent virtually nothing on it, apart from new sails and a new saildrive plus normal maintenance and sold it in 2015 for £43k. So, just about evens.
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Had you invested that £90k at a modest 3% annual return, you'd have had £136k at the end, so your "evens" would actually be a loss of £93,000. But hey, small change.
 
JumbleDuck said:
And at that point I give up on this one. You're just being silly now.
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No, I am not.

Somebody on my grade in the teachers pension scheme (roughly equivalent to a deputy head) and 40 years service would get a lump sum of around £90k on retirement. Similar in the NHS and local authorities as well as some parts of the private sector - plus for many who don't quite make 65, generous redundancy payments. Modest amounts, say £3k a year into ISAs for 20 years another £75-80K. I bought my house in 1982 for £36k. Spent around £100k over the years on extensions etc. Now worth £500k. Downsize to average price 3 bed at £300k. Another £200k minus cost of moving, say £20k.

Not difficult to see how relatively "ordinary" people with secure reasonably well paid jobs can build up that sort of net worth, even if it is not all in cash that can be spent on a boat. What messes it up for many is divorce, having children late in life and choosing to consume (often through credit) rather than save - as well as job insecurity.

Isn't it just this that the young are moaning about? - the wealth their parents' generation have acquired? Of course they forget (or don't know about) the scrimping and scraping that was necessary in the early years. No holidays, no eating out, running worn out Standard 10s, coping with 15% interest on the mortgage.
 
I would fall into the group that think £100k is a lot of money.
I suspect I am in the majority.
Even if the boat doesn't depreciate greatly it is true to say boating is not a cheap hobby.
However I chose to spend my money on boating as I find the boating experience immensely gratifying. therefore , for me, the expense, although demanding on my financial resources , is worthwhile.
 
Tranona said:
Not difficult to see how relatively "ordinary" people with secure reasonably well paid jobs can build up that sort of net worth, even if it is not all in cash that can be spent on a boat.
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The key to your examples, with which I agree, is that they all kick in on retirement. It's a comparatively small group of people who have those options: those retiring with decent pensions and/or able to make money from downsizing and without dependants to support. Even they will in many cases be thinking of saving towards future care needs rather than blowing the money on a boat.

Now it may well be that the small number of 60 - 70 year olds willing to spend £100k on a new Bavaria is what keeps the whole boat market going (as with cars, somebody has to be buying new) but for most sailors it simply is not an option.
 
I am 32 i brought my first sail boat at 26. On my wage as an engineer and the sole earner in the household, I cant afford to buy a house in the current housing market. I could spend my life saving to buy a new or newer boat but decided to blow the few thousand i had on my first boat and go sailing. I Paid £9500 for my first boat spent £2000 on an engine rebuild and rerig doing all the work myself. Sailed at least a few thousand miles around the south coast and northern europe with my young family and sold it last year for £11500. Loved every minute of my old boat.
 
Tranona said:
It is true that owners of older boats have the discretion to not spend on keeping their boats up to scratch, hence all the clapped out unsaleable boats potential buyers here moan about. Graham is an example of somebody just starting that downward path for his boat. For many people the fixed, non discretionary annual expenditure is the biggest proportion of their total annual cost, and it is the same whether you have a new boat or an old one (although not the same for everybody), and particularly not the same in all parts of the country. However, the majority of boats are kept in the parts of the country where such costs are high, for all the reasons often debated here......

Opportunity cost is a tricky beast, which is why it is best left out of the equation. In strict monetary terms (the most common measure) it is currently close to zero on a risk free basis. In a more general sense that is, what alternatives are more valuable to you, it becomes more variable, personal and difficult to quantify. It also changes according to your circumstances. So, if the big C had not got me in 2009, I would still have a boat in the Med and would be spending 3 months of the year in New Zealand or travelling. Those options are no longer open to me, so I have a new boat which will hopefully give me 8-10 years of trouble free pleasure.

It is the enormous increase in personal wealth of a large section of the population in the last 30 years that has opened up all this choice and you can see it in so many ways - second homes, boats, collectors cars, travelling, continuous home extensions and updating, conspicuous consumable expenditure etc. This is not a time or place to discuss the rights or wrongs, nor whether it will continue - that is for the Lounge, but it is here, real and underpins the boating world.
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Late to this thread; basically agree with this and it is a road I have just traveled. My boat has crossed 10 years now, so I had a good look at lot of new boats in its category, some a squeak faster and some more leisurely.

Basically I couldn't see the point in buying another, so it became a question of pulling the current one up to spec, which aside from the usual stuff, has like your last boat, cost very little over the past 10Yrs. However, as you will probably recall it required a few £££ thrown in its direction. Sails and engine were in great nick, but new electronics, rudder bearing upgrade, some mast work to remedy a bit of over zealous beating and so on and the bill came to about 15% of the price of a new one.

And to be honest most of this wasn't budgetable, more along the lines of, "there's a little crack in the spreader here, a spot of compression on the mast there possibly requires a doubler plate ...oh heck with the stick out I might as well...."

I wonder if the unexpected nature of these repairs is part of the problem?

As to the question of opportunity cost of a new one, I could not help but notice the number of posters who regard UK houses as equivalent to a high-yielding Gilt. Perhaps UK real estate is an upward only ratchet, perhaps it is a bubble, time will tell!
 
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dom said:
As to the question of opportunity cost of a new one, I could not help but notice the number of posters who regard UK houses as equivalent to a high-yielding Gilt. Perhaps UK real estate is an upward only ratchet, perhaps it is a bubble, time will tell!
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A huge amount of the spending Tranona describes - boats, cars, holidays and so on - has been paid for by house price inflation. Or, more accurately, by younger generations paying through the nose to buy from older generations. It's hard to see how that can be sustained indefinitely. Anecdotally there may be a small surge in discretionary spending as young people give up all hope of buying and stop saving for deposits, but rents in some areas are already at spectacular levels, so both for the individuals and for the system as a whole it's probably a short term effect.

I don't think the generations which retire at 70 after a working lifetime of extortionate housing costs with less generous pensions than today's lot will have anything like as much money to fling around. For a start, the window between "retirement" and "care" is only going to get narrower.
 
JumbleDuck said:
I don't think the generations which retire at 70 after a working lifetime of extortionate housing costs with less generous pensions than today's lot will have anything like as much money to fling around. For a start, the window between "retirement" and "care" is only going to get narrower.
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Many of current generation's pensions aren't too good either, our funds never recovered after the crash in late '90s. Those of us with boats
however old and tatty need to remember there are tens of thousands out there who don't have the money to buy even a dinghy.

I get a bit fed up with hearing how our generation have dropped the younger ones in the sh1t but I see a vast difference in priorities. I started off work as an apprentice motor mechanic, earning very little in the 60s. My generation (in general terms) were more frugal, scrimping and saving to get into the housing market, then spent money later in life. Now it seems, £500+ phones, expensive cars (often lease hire these days) and holidays, lots of eating out and weekends awy etc are a higher priority with many, who moan they can't afford a house. We have a poster above who couldn't afford a house in his 20s but spent the £11,500 which could have been a deposit on one, on a boat?
 
JumbleDuck said:
A huge amount of the spending Tranona describes - boats, cars, holidays and so on - has been paid for by house price inflation. Or, more accurately, by younger generations paying through the nose to buy from older generations. It's hard to see how that can be sustained indefinitely. Anecdotally there may be a small surge in discretionary spending as young people give up all hope of buying and stop saving for deposits, but rents in some areas are already at spectacular levels, so both for the individuals and for the system as a whole it's probably a short term effect.

I don't think the generations which retire at 70 after a working lifetime of extortionate housing costs with less generous pensions than today's lot will have anything like as much money to fling around. For a start, the window between "retirement" and "care" is only going to get narrower.
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Very true; the rise in the capital value of UK property has effected an unprecedented intertemporal shift in wealth from the 'proletariat' (those who sell their labour for a living - i..e the young and poorly paid), to the owners of capital (the rich + old). The reasons are complex, but in a nutshell non-linear and sign switching fiscal multipliers (you'd love them!) caught Gonzo Osborne (not sure you'd love him so much :rolleyes:) out in 2012. Help-to-Buy and pension derestrictions were introduced to get a good old UK property on the move and with it the UK's consumer-centric economy.

As you say this is not sustainable and I don't mean from any particular political perspective. There is simply not a central bank or any other coherent econometric model which can explain how we can squeeze a younger generation and saddle them with so much debt in this manner and pay no price for it -- even if we have no moral qualms in doing so.

Edit: What the UK has effectively done is borrow future spending which would have been previously undertaken by today's young and handed it to the owners of assets today (property, bonds, stocks, etc). The young will now be forced to buy the first of these with big debt and save to purchase the latter as part of now more expensive pensions as they go along. They will therefore have less money to spend; we can almost say QED here in the absence of any magical thinking.
 
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I am not sure what the term "Up to scratch means in this context.

Is it hot water/shower all new electrics and wiring the latest all in one depth log gps type thing.
Or is it the cabin interior?
 
GrahamM376 said:
We have a poster above who couldn't afford a house in his 20s but spent the £11,500 which could have been a deposit on one], on a boat?
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This entirely depends on where the poster above lives and works. There are many areas of the country where in 2006 (a year of double-digit house price inflation) a deposit of that size would barely have bought you a shed, never mind a two-bedroom flat.
 
I dont know how to add a quote but just as a reply to why i didnt continue saving for a deposit on a house. This is because with a young family just saving £10,000 was very hard work with high rental prices. I then having saved that hard earned money applied for a mortgage in principal. With the wages i was earning at the time i could borrow £80,000 odd. Honestly in the area i live you cant even buy half a 1 bedroom flat with that. So to get a 2 beroom property i would basically have needed upwards of £100,000 deposit. That would take a lifetime to obtain. I think its easy for someone who has money to say its easy just save, but i can assure you for younger people its not as easy as that. Im glad i made the decision i did because i now live on my new but old bigger boat and im convonsed i get much more from it than any square box could give me
 
GrahamM376 said:
Many of current generation's pensions aren't too good either, our funds never recovered after the crash in late '90s. Those of us with boats however old and tatty need to remember there are tens of thousands out there who don't have the money to buy even a dinghy.

I get a bit fed up with hearing how our generation have dropped the younger ones in the sh1t but I see a vast difference in priorities. I started off work as an apprentice motor mechanic, earning very little in the 60s. My generation (in general terms) were more frugal, scrimping and saving to get into the housing market, then spent money later in life. Now it seems, £500+ phones, expensive cars (often lease hire these days) and holidays, lots of eating out and weekends awy etc are a higher priority with many, who moan they can't afford a house. We have a poster above who couldn't afford a house in his 20s but spent the £11,500 which could have been a deposit on one, on a boat?
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Eating out, holidays abroad, cars, and consumer electronics have become considerably cheaper in real terms- so these things are not quite the luxury that they once were.
Anyway, you'd have to buy a lot of iPhones to make up for the fact that a house today costs about eight times the average annual wage, whereas a few decades ago it was two or three times. The number of people in their 20s who can buy a house is a fraction of what it used to be, thanks to restricted lending and inflated prices.
It doesn't matter if you become a complete ascetic and deny all modern consumer goods, you still can't buy a house if you're earning less than average. Instead, you'll be paying a similar amount per month to a landlord who then uses it to pay their mortgage.

The real riddle is why, when they have legitimate reasons to be angry, more young people do not vote.
 
Is your 376 really worth £45-50? . Last year I spoke to someone just buying one from Hamble point and he paid £23k, all the systems worked and was about to motor it round to Poole to use as cheap weekday accommodation whilst he worked Monday to Friday in the marine trade there. Of course it had been for sale for well over a year. Unfortunately there is very little demand for "old" boats that don't look like the modern ones shown at the boat shows.
 
Onia said:
Is your 376 really worth £45-50? . Last year I spoke to someone just buying one from Hamble point and he paid £23k, all the systems worked and was about to motor it round to Poole to use as cheap weekday accommodation whilst he worked Monday to Friday in the marine trade there. Of course it had been for sale for well over a year. Unfortunately there is very little demand for "old" boats that don't look like the modern ones shown at the boat shows.
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Some even sell for around £60k but that's rare. At £23k it must have been a real shed or distressed sale, maybe an early 37 with knackered BL engine. A very quick Google brings up these - http://www.yachtworld.co.uk/boats/category/type/Moody/376/United+Kingdom and thesehttp://www.boatshop24.co.uk/boats-for-sale/moody/376

Just done a bit more Googling - http://www.newsnow.co.uk/classifieds/boats-for-sale/moody-376-for-sale-uk.html - Fortunately, there is a good market for well found older boats as many don't like or can't afford ones that look like the modern ones shown at the boat shows
 
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