Which Boat

[simonjames]

I was wondering if anyone on this forum could give me some advice please. We are thinking of buying a flybridge motorboat of approximately 40 - 45ft in length. We currently own a 43ft yacht which is 3 years old. The problem I have is that as the kids get older they want to sail less & less. I used to own a 19ft bayliner powerboat as well as several other small sportsboats so I am not a complete novice. We have been browsing through magazines etc and really fancy a Princess 45 around late 1980's to early 90's. We have around 140K to spend and I thought if an older boat needed a bit of tidying interior wise and upgrading electronic wise we could put the money to good use. I would appreciate anybodys advice on which boat to choose and the pitfalls if any of owning an older boat. We have 2 children aged 6 and 10 and would really like a boat with 3 cabins. Lastly if the government reclassifies red diesel what kind of impact do you think this will have on the re-sale value of motorboats.
Your advice would be appreciated

Simon M

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[deborahann]

Nothing wrong with a late 80's Princess, long as it's serviced well. I cant stand the new squinty eyed newer ones anyway. Have not got a christal ball regarding diesel prices../forums/images/icons/smile.gif

<hr width=100% size=1>deborah on delft.
Nothing to do with Mucky Farter or hlb in drag

 

[steverow]

Have a good look at the Princess 415, late 80's.
What it lacks in length it makes up for in beam.
A terrific boat.

Steve.

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[Deleted User YDKXO]

I'm sure you will get lowdown on P45 from adarcy who has one of these. If not PM him
P45 is a fine boat with excellent seakeeping, loads of space and good looking IMHO. I would go for one of the later models with grp radar arch and as powerful engines as possible (Volvo 71B/72A or Cat 3208 375hp) . You should find a good one for your budget and you should get goodies like a gennie, aircon and updated nav kit
As an alternative have a look at the Princess 435. Another excellent boat but again better with bigger engines like Volvo 71B
Regarding red diesel derogation, IMHO, it wont make much difference to values of boats if this is lost ( I will probably get flamed for that statement by other forumites). Consider the fact that most of Europe pays road fuel prices for marine diesel and yet you still see loads of big mobos particularly in the Med and the other point to consider is that secondhand prices for boats are roughly similar all over Europe. If UK market prices suddenly dropped, there would be an influx of foreign buyers for UK boats and prices would rise again - free market economics
I think what will happen in the short term is that people will think harder about how they use their boats possibly resulting in less usage and in the long term, engine manufacturers and boat builders will develop more fuel efficient boats which is no bad thing anyway


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[jfm]

Markets only move on surprises

I dont have specific info on those models so can't comment on them but Deleted User is right that red diesel price hike will not affect 2nd hand values much. It's not a secret, it's been splashed all over this forum, MBM magazine, and everywhere else, so any affect on price is mostly already in the price. The only thing that will cause a step-change in the price of MOBOs (indeed anything) is a surprise, and taxed-diesel in 2006 or whenever is already fully public knowledge, so not a surprise, so moslty factored into the price already

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[duncan]

Re: Markets only move on surprises

I would agree with mike and jfm re prices in the size of craft you are looking at - as much because there isn't any petrol alternative as the generally pan european market.
There is clearly a differential price on many smaller craft, especially s/h, where both petrol and diesel are options and shipping would be a price factor - ie if you had both a petrol and diesel version and could make a one of decision re where to sell them you would base the petrol one in Spain and the diesel one in the UK.

<hr width=100% size=1>madesco madidum ..../forums/images/icons/smile.gif

 

[Bandit]

I bought a very tatty 1986 fairline 36 Sedan on which I did a major refit: new engines, gearboxs, shafts, props, exhausts, fuel tanks and lines, canopy, radar, plotter, saloon wooden lining, matresses and exterior seating, hull windows and hatch , new decals, Curtains etc etc.

It was a very large project and I am not sure that I would choose such a basket case as this one was but now I have the boat I want that does 29 knots not 14 , has a 70% greater rance and looks pretty damn good . The important thing in this boat is the new engines and greater performance.

You can however get a used boat with excellent accomodation for about a third to a half of the price of a modern equivalent .

A Princess 45 is on my wish list , make sure you get the right cabin layout for your family depending on the number of ankle biters they do a 2 canin plus lower dinette and saloon and a three cabin plus saloon which I what I would prefer with three kids.

Give me a pm if you want to discuss the project.

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[Gludy]

"Regarding red diesel derogation, IMHO, it wont make much difference to values of boats if this is lost ( I will probably get flamed for that statement by other forumites). Consider the fact that most of Europe pays road fuel prices for marine diesel and yet you still see loads of big mobos particularly in the Med and the other point to consider is that secondhand prices for boats are roughly similar all over Europe. "

really must, no surprise disagree with you on this:-
1. Most of Europe pays about half our road fuel price - so what you are saying is that if prices rise to UK raod prices the value of crusing boats will remanin the same? If that is what you are saying then you are plain fact wrong.
Today we have small cruising boats with petrol engines in the UK - they are priced much cheaper than diesel so the facts demonstrate that you are wrong in your assumptions.
Also s/h boats are cheaper in the Med than in the UK.

"If UK market prices suddenly dropped, there would be an influx of foreign buyers for UK boats and prices would rise again - free market economics".

Illogical - the free market would adjust supply/demand to a new lower price that reflected the fuel costs and just like large cars in the USA, the prices would plummet like a stone. As regards Europe coming in to snap them up the only way this happens is for the prices to be low enough to make it worthwhile - maybe the larger Mobos can be exported to Europe but a lot of the normal 30 to 45 boats will find no ready market there.

"I think what will happen in the short term is that people will think harder about how they use their boats possibly resulting in less usage and in the long term, engine manufacturers and boat builders will develop more fuel efficient boats which is no bad thing anyway"

Sorry but I do not know what world you are living in here. There is already great pressure on engine manufacturers to reduce fuel consumption - any one of them who manged to say cut consumption by two thirds for a given hp output would clean up all the marine sales ......so no white knight over the hill to save us there.

As regards less usage ... yes incredibly less usage. You think more than twice if a trip costs 3 or four times what it used to cost ... in fact you get out of boating or send your boat abroad.

To think that a fuel increase of 300% to 400% will not have a dramtic effect on the prioce of cruisng motor boats is to delude oneself into an uncomfortable make beleive world.






<hr width=100% size=1>Paul

 

[Deleted User YDKXO]

Sounds like a major project, bandit. Why dont you post a report on this forum. I, for one, would be interested.

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[Gludy]

Re: Markets only move on surprises

"The only thing that will cause a step-change in the price of MOBOs (indeed anything) is a surprise, and taxed-diesel in 2006 or whenever is already fully public knowledge, so not a surprise, so moslty factored into the price already "

The price has not been factored in and beleive me if fuel prices reach road levels then almost every UK cruising motor boat owner will be very surprised. Your claim that boat prices already reflect this price hike is simply not true. in fact many owners are not aware of it, others, even the majority consider that anything but a modest hike will not be allowed to happen.





<hr width=100% size=1>Paul

 

[jfm]

market forces, only surprises move prices

Gludy, you say "To think that a fuel increase of 300% to 400% will not have a dramtic effect on the prioce of cruisng motor boats is to delude oneself into an uncomfortable make beleive world." - my emphasis.

You use future tense, but surely, the price impact has already occured? If the papers ran a well-founded surprise story this morning saying "British Airways to be taken over by Virgin", the price of BA shares would rise immediately to include a bid premium. Even though there was no actual offer from Virgin. Subsequently, on the day Virgin actually mailed its offer to BA shareholders, the BA price wouldn't move much, if at all.

So if it's common knowldge (with say 80-90% certianty) that diesel will rise to say £1 litre from 2006 (or whenever), then surely any price impact will exist already, wont it? If the diesel price rise occurs 1 Jan 2007 (I'm making that up, I have forgotten the correct date) then it would be nonsense to think that price of secondhand boats would fall at midnight 31.12.06. Otherwise who were all the dumb secondhand buyers buying Mobos in Q4 2006 at a "dramatically" higher price reflecting 30p/litre diesel?

So, I can believe that taxed-diesel will impact boat prices and residuals, but I think most of the impact has already mostly occured. By observation, it's a small number. Or, where am I going wrong in this Gludy?

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[Gludy]

Re: market forces, only surprises move prices

"You use future tense, but surely, the price impact has already occured?"

no it has not. We do not know if the price hike will happen or how much it will be. Further the typical cruising boat owner is currently ignoring it. So no it has not occured ... its an unknown.

"So if it's common knowldge (with say 80-90% certianty) that diesel will rise to say £1 litre from 2006 (or whenever), then surely any price impact will exist already, wont it?"

What is common knowledge - that diesel will rise to £1 per litre the road fuel level? Not at all .. some think it will not rise at all ... others that they will simply adjust the VAT ... others that we will be brought to European levels ... others that it will rise to road fuel levels ....

If the price went to £1 per litre tonmmorrow do you really think it would have no impact on the price of my boat where a trip over to Padstow would cost £1200 instead of £300? Of course it would - the market would be devasted. The markeyt has not discounted the probable price hike at all.
As the time gets nearer the chances are that the market will slow down - less buying but there will be huge resistance to price dropping just like the housing market until the price hike actually happens.

"So, I can believe that taxed-diesel will impact boat prices and residuals, but I think most of the impact has already mostly occured. By observation, it's a small number. Or, where am I going wrong in this Gludy? "

Where you are going is wrong. The possible hike is being ignored at present ..... boat prices have not dropped over the last few years (as would be expected if the hike had been factored in).... most still hold out that the government cannot be so stupid as to put it up 3005 to 400%.

When house prices drop suddenly because people have most of their capital tied up in them they simply do not sell them ... it takes time before they drop and the ones hit are the ones who have to sell. The number of transactions decreases a great deal. You may well see that happen during the next few years in the boating market but most simply cannot afford to drop their prices now and most buyers are feeling that a huge hike cannot happen. The average MoBo owner will suffer greatly if the full price hike happens and boat prices will collapse.

The impact will happen once the price hike, if any, is announced.





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[markc]

Also worth a look at Fairline 43/45...I have had one for 4 years - brilliant boat!

M

<hr width=100% size=1>http://www.geocities.com/jinto100/Jintopics.html

 

[Deleted User YDKXO]

Well I knew it was coming and there's a lot to take issue with here

1. There is still a premium for diesel powered boats even in Europe where the price of petrol and diesel are similar because diesel engines are always going to be more fuel efficient, safer and, arguably, more reliable than petrol engines. Ask yourself why diesel powered cars sell for higher secondhand prices than petrol ones even though road diesel costs more than road petrol? In any case, a boat like the P45 has no petrol engined version so the comparison is'nt valid
2. I think you overestimate the importance of the UK market which is only a small part of the European boat market. Some price fluctuations in the small UK market are not going to cause the whole European market to crash.
3. You are wrong to state that there will not be an influx of European buyers because its happened before in the early 90's when the recession in the UK and weak Sterling caused secondhand UK boats to be cheaper in foreign currency terms. In fact I sold a 36 footer to a German chap simply because his Deutschmarks bought more in the UK than Germany and brokers I spoke to reported a lot of sales to European buyers at the time. Then in the late '90's the reverse happened, Sterling strengthened appreciably and for a while, Sterling bought more in Europe than the UK. I bought a 47 footer in Germany myself and took advantage of this and so did a number of other UK buyers. So, its not true to say that buyers will not buy abroad if there is a financial advantage, even for smaller boats. As another example, there have been a number of posts on the Forum recently from people looking to buy in the US. There will always be short term anomalies like this but prices will always converge in the long term in a free market
4. Secondhand boats are not cheaper in the Med. In the past 2 years, I've bought 2 boats in the Med and the prices I saw were not a lot different to the UK. The only reason I bought them there was because thats where I wanted to use them
5. Engines may be more fuel efficient but hulls are not. Semi displacement and planing hulls are hugely inefficient hull forms especially when driven by shaftdrive propulsion. Basically, mainstream planing hull design has hardly advanced at all in 20 years. The hull design of the Princess 45 that is the subject of this post is very little different to that of the current Princess 45. All I'm saying is that rising fuel prices might encourage boat builders to explore other hull forms eg multihulls which are significantly more fuel efficient than monohulls or different propulsion systems eg surface drives which are far more efficient than conventional shaft drives

Basically, I just dont think your armaggedon view is going to happen

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[jfm]

Re: market forces, arbs form orderly queue here

Hmm, thanks for explanation, I see where you are coming from. I think we just have different views on the efficiency of the market. You think current secondhand (and I suppose, new) supply-demand levels are based on a view (or ignorance) that red diesel prices will stay as now. I however think a substantial fraction of the market expects impending high price yet are buying/selling in today's transactions despite it.

If you were right, and only this forum and a few others know about diesel price hike, there is an arbitrage opportunity isn't there? We should all wait till just before knowledge of the fuel price rise leaks out, and sell our boats at that point. Then a few months later, when expensive diesel is on sale at the pumps, we can buy our boats back at much less £££, thus all pocketing £50grand or whatever?

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[Gludy]

"Well I knew it was coming and there's a lot to take issue with here"

Good, because the debate can only help.

"1. There is still a premium for diesel powered boats even in Europe where the price of petrol and diesel are similar because diesel engines are always going to be more fuel efficient, safer and, arguably, more reliable than petrol engines. Ask yourself why diesel powered cars sell for higher second-hand prices than petrol ones even though road diesel costs more than road petrol? In any case, a boat like the P45 has no petrol engined version so the comparison is'nt valid"

I agree there is a premium for diesel powered cars and there would also be one for diesel powered boats BUT the premium is nothing like the amount it would be if the price hike had happened.

I know someone in our Marina - bought a petrol 33 footer - one trip - one petrol bill - set about changing engines to diesel for one reason the cost.
Where today you have cruising boats with the petrol/diesel option the petrol version is very much cheaper indeed much more than would be the case simply for a preference towards diesel.

What you are trying to sell here is absurd
You are stating that the market has already discounted the price of boats to allow for £1 per litre diesel ..... That is an absurd position to take. no one even knows what the price will be yet!

Whoopee!!! this means that after X date all our boats will be worth the same despite a price hike of 300% to 400% on fuel costs!!!!! I really wish what you are stating was true but it is not.

"2. I think you overestimate the importance of the UK market which is only a small part of the European boat market. Some price fluctuations in the small UK market are not going to cause the whole European market to crash. "

At no point, in any thread, on any forum have I ever stated that the European market will crash. I have stated that the UK cruising powerboat will crash. Bigger boats like mine are easier to take to the Med and sell, (although they will be cheaper there), the average punter in our marine will not have that option without a huge drop in price. Cruising powerboats prices in the UK market will crash ... and I mean crash.

"3. You are wrong to state that there will not be an influx of European buyers because its happened before in the early 90's when the recession in the UK and weak Sterling caused second-hand UK boats to be cheaper in foreign currency terms. In fact I sold a 36 footer to a German chap simply because his Deutschmarks bought more in the UK than Germany and brokers I spoke to reported a lot of sales to European buyers at the time. Then in the late '90's the reverse happened, Sterling strengthened appreciably and for a while, Sterling bought more in Europe than the UK. I bought a 47 footer in Germany myself and took advantage of this and so did a number of other UK buyers. So, its not true to say that buyers will not buy abroad if there is a financial advantage, even for smaller boats. As another example, there have been a number of posts on the Forum recently from people looking to buy in the US. There will always be short term anomalies like this but prices will always converge in the long term in a free market"


The only reason that could cause an influx of overseas powerboat buyers is a drop in price - if this had already happened then they would be here now buying up boats like crazy but they are not!!!!

Of course market fluctuations are going to make it worthwhile to buy from this country or that.

You approach is theoretical ... its does not apply to the housing market and the boat market is much nearer to that then the car market. Many people have all their spare money in their boat ... they simply cannot afford a big price drop.

Prices have not changed much in the Uk during the last number of years and the reason is that the diesel issue has not been factored in.

"There will always be short term anomalies like this but prices will always converge in the long term in a free market"

I agree with that but the end position will be that the only worthwhile market for cruising power boats will be overseas not in the UK.

"4. Second-hand boats are not cheaper in the Med. In the past 2 years, I've bought 2 boats in the Med and the prices I saw were not a lot different to the UK. The only reason I bought them there was because that’s where I wanted to use them"

Ask any broker and second hand prices, especially on the older boats are lower in the Med than here - the differential grows with age. med boats coming here have a price reduction factored in because of the effects of Med cruising. i wish you were right on this but you are not.


"5. Engines may be more fuel efficient but hulls are not. Semi displacement and planing hulls are hugely inefficient hull forms especially when driven by shaftdrive propulsion. Basically, mainstream planing hull design has hardly advanced at all in 20 years. The hull design of the Princess 45 that is the subject of this post is very little different to that of the current Princess 45. All I'm saying is that rising fuel prices might encourage boat builders to explore other hull forms eg multihulls which are significantly more fuel efficient than monohulls or different propulsion systems eg surface drives which are far more efficient than conventional shaft drives"

Nonsense - they are already exploiting all these things as much as they can. The subject between us is your statement that UK boat prices have had the fuel price discounted in them already at not only that discounted to the price of road fuel ... I am stating that that point is wrong and misleading.

"Basically, I just don’t think your armaggedon view is going to happen "

No ... I have always held the same opinion .. the UK cruising power boat scene will crash .. the ones that survive will be just the very wealthy and the scene as we know it today in numbers and industry support will not be at anything like the same level.

However the whole point of this post is that you are claiming that the market has already discounted UK boat prices to allow for the £1 per litre diesel and I am stating that is rubbish.

Your economic model is too simple and does not take into account the nature of the money that most people have tied up in their boat.

It does not take into account that we, nor you, know what the price hike will be. Europe operates at about half the price level we are talking about.

So if it were announced that diesel is going to £1 per litre ... you are saying UK cruising power boat prices will not alter because the market has already discounted them .... I wish you were right but I think anyone in touch with the UK boat scene knows you cannot be.


<hr width=100% size=1>Paul

 

[Gludy]

Re: market forces, arbs form orderly queue here

I am saying that the market has not adjusted to £1 per litre and the majority of the market would never envisage that full price hike happnening.

You case is based on a full fuel price hike that may not even happen!!!!!

I a m also saying that the market is not efficient. Most folks have a lot tied up in their boat ... say 80k and its all the capital they have apart from their home. Hence in a poor bare market supply simply dries up. I do see the power boat sales slowing down next year as the diesel question looms nearer ... I do not see widepread selling/buying.

"If you were right, and only this forum and a few others know about diesel price hike,"

I never siad that ... you take my points to extremes .. what I do say is that many do not know and the vast majority have shelved thinking about it ... when the subject does come up they reckon on maybe a full rate of VAT being applied etc.

One thing that I am cerain about is that they have not factored in the road fuel price ..... if they had you would have seen dropping prices and this has not happened .

So what happens if you sell your UK boat and the red diesel simply goes up with a 20% vat rate applied? Such a rise would not have tto much effect and you would be looking a bit foolish buying the boat back

Why are you so certain that its £1 per litre and that the market has adjusted to this level?

<hr width=100% size=1>Paul

 

[jfm]

Re: market forces, arbs form orderly queue here

I dunno if it will be £1 or whatever, just using that number as an example. I do howver expect it will be in the order of £1/ litre. And that's the whole point. The market doesn't know what the fuel price will be. Nor does it know Virgin will launch the full offer for BA. Markets are priced on people's expectation of the future, not their knowledge of it.

I say there is considerable knowledge in the market now of the price rise proposal, and the market has discounted the expected outcome already. And boat prices have not moved much despite that. You say, in contrast, that the markets have not already discounted the fuel price hike and it's becuase of that ignorance that prices haven't adjusted. Let's agree to disagree on that

Not sure I understand your penultimate para with VAT in it. You clearly have a view on the furure market - you say demand and pricing for mobos will fall considerably etc (I think - sorry if misquoting you). You also think today's market has not yet discounted those things that YOU think will happen. So aren't you in the classic arb/hedge fund manager position? You should sell now, buy back later?

(With apologies, the sell/buy suggestion is a bit tongue in cheek, selling + buying your favourite toy isn't the subject of rational economics to begin with - that's part of the fun!)

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[Deleted User YDKXO]

1. There are no European buyers in the UK market at the moment because there is no financial advantage for them to buy here. If the UK market dives then there will be plenty of buyers here just like there were in the early 90's.
2. Sorry but there is no major price difference between here and the Med and any broker that tells you that is feeding you a line. Some boats do come back from the Med to here for sale but there are specific reasons for that, usually, that a Brit boat sells better in the UK or its shagged out from charter use and nobody will buy it. In any case what are the "effects of Med cruising"? Med boats usually have lower hours and better equipment
3. Do you really think hull forms can not be developed for better fuel efficiency? I take it you're still tooling around in a Mk1 Cortina then

In a way, I have already experienced what you say is going to happen in the UK because 2 years ago, after about 12 yrs boating in the UK, we started boating in the Med. From paying 28 p/l for fuel in the UK, I was suddenly paying 70 p/l in France. Now, unfortunately, I am not sufficiently rich to not care about fuel costs. We have changed the way we use the boat, whereas in the UK, we would not particularly think about how many miles we cruised, we just blatted about everywhere, in the Med, we do think more carefully about how far we go and also at what speed - I cruise slower now in order to conserve fuel
I think that this is the way motor boat owning will go in the UK. Not less boats or lower prices, just less cruising

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[theguvnor]

Well Simon, as a new user, has learnt something today, even if it was just a thought on the last line of his post - Beware the of mentioning fuel prices/differences/derogation etc if you want the rest of your question answered !

No offence intended - a very well argued & knowledgable debate gentlemen

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