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Boat Depreciation/Appreciation


Blackcountrymon

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New to the forum and this is my second post.

 

I'm considering purchasing a nb. I own a vw camper and over the years it has appreciated in value. Being new to this... if you look after your nb how will the value be affected over the years? Any general trends?? I'm looking to spent about £20k and make some improvements rather than a shell to refuit so to speak.

 

Thanks

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A boat is a hole in the water which you try, but always fail, to fill by throwing money in.

 

It is possible to make money by doing up boats and selling them on but never sit down and work out your hourly rate of pay...It is just too depressing.

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As Carlt said - - it is (generally) accepted that boats only ever depreciate.

 

It is, of course, mathematically, possible to buy a boat for what you hope is a bargain price, wash and polish it, and then sell it on at a profit.

 

Just as one could an house

 

However, the boat market is as depressed as the housing market, with a great deal of stock available for sale, and comparatively few buyers.

 

The other thing is that you need to appreciate that there are a great many elements of boat construction & condition that you need to understand BEFORE you embark upon such a project, otherwise for your £20k you could well end up spending £20k & buying a 'pup', and suddenly finding that you need to spend another £10k on it (replating the hull, for example), just to be able to sell it for £20k.

 

Just be very careful - - do all your learning before you 'invest'

 

 

 

 

 

 

Edited for pour speling

Edited by Grace & Favour
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New to the forum and this is my second post.

 

I'm considering purchasing a nb. I own a vw camper and over the years it has appreciated in value. Being new to this... if you look after your nb how will the value be affected over the years? Any general trends?? I'm looking to spent about £20k and make some improvements rather than a shell to refuit so to speak.

 

Thanks

 

A lot will depend on the boat you buy. We bought our boat going on for four years ago (doesnt seem like that long :blink: ) and it is still worth pretty much what we paid for it then. That doesnt of course take into account the thousands we have spent on it keeping it in top condition. Buy a boat by a respectable builder (much easier in the sea boat market BTW.) and it will tend to keep its value better.

 

Sales of boats like ours are still very active. The brokerage at our marina seems to be selling a lot of good quality boats at the moment but as with every yard it does have the odd shabby boat at the back that refuses to be sold.

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A new boat depreciates dramatically the moment it is launched, just like a new car does.

 

If it is well-kept, it often regains some of that depreciation over the next 2 or 3 years, at roughly the same rate as a small house or flat gains in value over the same period (which has not been much, recently) but it can never quite regain its original sale price.

 

After that, if it continues to be well maintained, its value should remain roughly the same numerical value, which of course becomes worth less each year because of inflation. The amount spent on maintaining it to that standard may be quite high, though.

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Does that apply to sought-after boats from builders with long waiting lists? I have heard that a new car from such a builder, such as a Morgan, can sell straight away for a higher price than its list price to someone who doesn't want to wait two or three years for a brand new one.

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:tongue_in_cheek_answer:

 

The record shows that boats like our Sickle were built by WJ Yarwoods in 1936 at £1,301, for a pair of 71' 6" boats.

 

I would have been very happy to pay a second-hand price based on that figure when we bought her at 75 years old last year. (Well a discounted price, as she was cut to 40 feet in 1942!)

 

This is obviously not typical of narrow boats generally, but someone with enough dry storage space might have done worse back in the 1930s to have some built, and left for their heirs to make a profit on now!

 

:serious_answer:

 

Most people unless they pick up a real bargain, or get lucky with a sale of a typical modern boat, would be unlikely to recoup the costs of work they have done to either improve it, or just keep it in good order during the period of their ownership, (quite apart from running, licensing and any mooring costs!). Generally you can expect canal boat ownership to leave you out of pocket, although clearly there are exceptions.

 

Does that apply to sought-after boats from builders with long waiting lists? I have heard that a new car from such a builder, such as a Morgan, can sell straight away for a higher price than its list price to someone who doesn't want to wait two or three years for a brand new one.

I would say generally "no", as usually there is a level of "bespokeness" that was driven by the person initially commissioning the boat, and it is unusual to find a second-hand purchaser who will be prepared to pay a very high premium for things they would probably not have had that way had they commissioned the build.

 

Generally I would say the losses on a rather more "off the peg" type of boat, (of a similar age), are less, even though they may not be half as pretty or well built.

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A lot will depend on the boat you buy. We bought our boat going on for four years ago (doesnt seem like that long :blink: ) and it is still worth pretty much what we paid for it then. That doesnt of course take into account the thousands we have spent on it keeping it in top condition. Buy a boat by a respectable builder (much easier in the sea boat market BTW.) and it will tend to keep its value better.

 

Sales of boats like ours are still very active. The brokerage at our marina seems to be selling a lot of good quality boats at the moment but as with every yard it does have the odd shabby boat at the back that refuses to be sold.

 

Thanks for all the good advice.. Being new to this I will be buying an oldish nb - to see how things go - I can live with depreciation and am handy so will be looking to make a few improvements etc - as long as the boat doesnt halve in price over a few years thats ok with me.

 

What would be the priorities to look out for - I was thinking a sound hull - reasonable interior - good electrics - battery management ? Again I am hear to learn from seasoned experience.

 

Thanks

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Thanks for all the good advice.. Being new to this I will be buying an oldish nb - to see how things go - I can live with depreciation and am handy so will be looking to make a few improvements etc - as long as the boat doesnt halve in price over a few years thats ok with me.

 

What would be the priorities to look out for - I was thinking a sound hull - reasonable interior - good electrics - battery management ? Again I am hear to learn from seasoned experience.

 

Thanks

 

You've got it about right I'd say. First thing must be the hull - anything seriously wrong there and its gonna be lotsa dosh.

 

Its almost never going to be a DIY job, whereas everything else can be if, as you say, you are handy and have the knowledge.

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:tongue_in_cheek_answer:

 

The record shows that boats like our Sickle were built by WJ Yarwoods in 1936 at £1,301, for a pair of 71' 6" boats.

 

I would have been very happy to pay a second-hand price based on that figure when we bought her at 75 years old last year. (Well a discounted price, as she was cut to 40 feet in 1942!)

 

This is obviously not typical of narrow boats generally, but someone with enough dry storage space might have done worse back in the 1930s to have some built, and left for their heirs to make a profit on now!

 

 

You've not taken inflation into effect. Our butty cost £190 in 1912. Allowing for inflation, this equates to £17,000 today. Similarly the motor cost £750 in 1928 and equivalent to £37,000 in today's money.

 

And a pair GU boats which cost £1300 in 1936 would be worth £72,000 now.

 

I would have said that they have kept their value quite well!

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I think the mindset for owning a boat should probably be minimising loss rather than making a profit.There will be exceptions to the rule like Laurie's mate above or rare bargains but in general a good policy would be to let someone else take the big depreciation hit (after twenty odd years prices tend to plateau ) keep on top of maintenance, make sure the hull is sound, the roof doesn't leak and the engine works. Another way of making money would be to buy in the north and sell in the south.Some people sell boats with moorings in the south in general and London in particular for far more than the boat is worth.

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Built property is an appreciating asset, but boats are NOT. A modern steel boat will be worth scrap steel value in 20 years unless there has been a LOT of structural TLC. With a reall old working boat, you don't so much own it as curate it and when it needs work -planks bearings etc you have to pay a LOT to get the skill and the materials to do a good job.

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My 2 penneth. I bourght our NB for £31,500. Owned it for 5 years during which time I did it up, did a lot of learning, had loads of time on it, had lots of fun, spent about £5000 on repairs, improvements and maintainence and sold it for £32,500

 

So I think on balance owning it really cost nothing when you factor in the value got form actually owning and enjoying it.

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My 2 penneth. I bourght our NB for £31,500. Owned it for 5 years during which time I did it up, did a lot of learning, had loads of time on it, had lots of fun, spent about £5000 on repairs, improvements and maintainence and sold it for £32,500

 

When was that?

 

I bought a boat in 2000 which went on the market in 2007 for 50% more. And I hadn't spent a great deal on it. But 2007/8 was probably the peak for boat prices and they have definitely dropped since then.

 

But as has been said, a well-looked after boat in good condition will always hold its value better. When I was selling boats it used to amaze me the condition some boats were offered in. Dirty, old food in the bin, unemptied ashtrays - I've seen it all (and don't ask about the condition or contents of some of the toilets).

 

So, don't expect it to appreciate. Expensive newish bespoke boats will lose a significant amount. Look after a few years old boat well and, providing it was bought at the right price, it won't lose a lot over a few years.

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When was that?

 

I bought a boat in 2000 which went on the market in 2007 for 50% more. And I hadn't spent a great deal on it. But 2007/8 was probably the peak for boat prices and they have definitely dropped since then.

 

 

I think a lot will depend on the boat and how market conditions in that sector are holding up.

 

NC was first sold late in 2003 from Burton Waters for £58k (inc VAT) with a long list of extras and a £3k trailer. We bought her in 2008 at not quite 5 years old for £38k without the trailer, so a loss of £17k if you ignore the trailer in 5 years, 17.5% of that being VAT which will pretty much have been lost as soon as the paperwork was signed.

 

Today NC is still worth about £38k almost 4 years after we bought her. At first glance this doesnt sound too bad but completely ignores the fact that we have spent at least £10k on maintenance and running repairs, plus servicing, mooring costs, insurance, licence and the biggy fuel :blink:

 

As someone has already said boat ownership isnt about making money. We wouldnt dream of getting rid of the boat now. The price we pay to keep her in top condition and running reliably is a small price to pay for our holidays and weekends away.

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I think a lot will depend on the boat and how market conditions in that sector are holding up.

 

NC was first sold late in 2003 from Burton Waters for £58k (inc VAT) with a long list of extras and a £3k trailer. We bought her in 2008 at not quite 5 years old for £38k without the trailer, so a loss of £17k if you ignore the trailer in 5 years, 17.5% of that being VAT which will pretty much have been lost as soon as the paperwork was signed.

 

Today NC is still worth about £38k almost 4 years after we bought her. At first glance this doesnt sound too bad but completely ignores the fact that we have spent at least £10k on maintenance and running repairs, plus servicing, mooring costs, insurance, licence and the biggy fuel :blink:

 

As someone has already said boat ownership isnt about making money. We wouldnt dream of getting rid of the boat now. The price we pay to keep her in top condition and running reliably is a small price to pay for our holidays and weekends away.

 

I think I may have mislead you. I am definitely not looking to make profit out of my adventure... I have a house and realise there are running costs to be factored in and thats not a problem. I just wanted to get a feel for value etc. If I buy a vw camper - provided i look after it, it will hold it's value but i have to spend to keep it maintained. If i buy a ford transit camper - it will loose money irrespective of how much i spend. I just wanted an idea really. If I buy a nb and don't loose too much when i sell it on after spending money on maintenance - thats fine with me as i will have enjoyed the time and there are very little things in life that are free..

 

Thanks

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Our first 'taster' boat cost £10k, had it five years or so, minimal maintenance costs, sold it for £15k, so we reckoned we pretty much had free boating for the five years we had it.

 

I think at £20k ish, you are looking at an interesting part of the market --- get it wrong and it will be a knacker you probably don't want at any price; get lucky and you stand to get some real value for money. Be aware that outside the world of brokers and magazine prices some very acceptable boats change hands at well below the figures you might imagine. As with houses -- death, divorce, run out of steam projects -- all come along on the canal as well -- and that's where the bargains lurk. A bicycle and stretches of on line moorings are an important tool here -- look for the fading, hand written 'for sale' sign.

 

First stage is to go and look at as many boats as you can; partly to familiarise yourself with the market, but primarily to see as many different layouts as possible. You will see things you hadn't thought of and really like and you will see things you realise you don't want at all. This is where marina based brokerages are handy -- the chance to do multiple tyre kicking all in one spot.

 

Another thing to factor in to the equation are your own skills, finances and available time. If you are a dab hand with the spanners, then a boat with a tired engine might represent a significant bargain opportunity; likewise, if interior refurbishment is your thing, then a tired interior or layout that wants changing may represent the same opportunity. Do bear in mind that if your prospective boat is for living aboard, you will have a different focus to an intermittent user, particularly if aiming to cc. Power generation, good size water tank, bathroom arrangements, means of heating, comfortable bed etc. etc.; all much more important when it's your home.

 

You have probably noticed by now that on the forum every point of view and piece of kit has its proponents and opponents. This can become confusing, as in many cases all the points are valid, so you do need to spend some time deciding what features would be really important to you and apply that filter. The only key requirement really is that the hull is sound - after that, most other things can be played with.

 

Mike.

  • Greenie 1
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I have never sold a boat for less than I paid

Bought a Springer in 91 for 11k sold in 93 for 14k

Bought a Mike Heywood tug in 93 for 24K lived aboard for 9 years sold in 2002 for 28K

Bought a Cutwater in 97 for 15k cruised all over the system sold 2002 for 19k

Bought the Barge in 2002 for 56k spent 30k on extension value now about 100k

Inflation however is another matter

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Our first 'taster' boat cost £10k, had it five years or so, minimal maintenance costs, sold it for £15k, so we reckoned we pretty much had free boating for the five years we had it.

 

I think at £20k ish, you are looking at an interesting part of the market --- get it wrong and it will be a knacker you probably don't want at any price; get lucky and you stand to get some real value for money. Be aware that outside the world of brokers and magazine prices some very acceptable boats change hands at well below the figures you might imagine. As with houses -- death, divorce, run out of steam projects -- all come along on the canal as well -- and that's where the bargains lurk. A bicycle and stretches of on line moorings are an important tool here -- look for the fading, hand written 'for sale' sign.

 

First stage is to go and look at as many boats as you can; partly to familiarise yourself with the market, but primarily to see as many different layouts as possible. You will see things you hadn't thought of and really like and you will see things you realise you don't want at all. This is where marina based brokerages are handy -- the chance to do multiple tyre kicking all in one spot.

 

Another thing to factor in to the equation are your own skills, finances and available time. If you are a dab hand with the spanners, then a boat with a tired engine might represent a significant bargain opportunity; likewise, if interior refurbishment is your thing, then a tired interior or layout that wants changing may represent the same opportunity. Do bear in mind that if your prospective boat is for living aboard, you will have a different focus to an intermittent user, particularly if aiming to cc. Power generation, good size water tank, bathroom arrangements, means of heating, comfortable bed etc. etc.; all much more important when it's your home.

 

You have probably noticed by now that on the forum every point of view and piece of kit has its proponents and opponents. This can become confusing, as in many cases all the points are valid, so you do need to spend some time deciding what features would be really important to you and apply that filter. The only key requirement really is that the hull is sound - after that, most other things can be played with.

 

Mike.

 

Thanks Mike I appreciate the advice. I have a bike and access to lots of on line moorings has been my diet over the last few weeks. My problem I suppose is not recognising a knacker.. but I suppose a good survey should help weed those out..??

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Thanks Mike I appreciate the advice. I have a bike and access to lots of on line moorings has been my diet over the last few weeks. My problem I suppose is not recognising a knacker.. but I suppose a good survey should help weed those out..??

 

If you're going to buy a boat for circa £20k - - - I would strongly suggest a full survey is a prerequisite

  • Greenie 1
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  • 3 months later...

Buy a boat by a respectable builder (much easier in the sea boat market BTW.) and it will tend to keep its value better.

 

 

What is meant by a respectable builder? Are there some builders that should definitely not be looked at?

 

At what sort of age do you need to start worrying about the hull? Or is that "how long is a piece of string?"

 

What sort of things are covered by a survey? and do you have any recourse if a fault is revealed after buying?

 

Am very aware that "buyer beware" will be the main caveat as with a second hand car.

 

Sorry for jumping on the thread but hope these questions fit with the theme.

 

:cheers:

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What is meant by a respectable builder? Are there some builders that should definitely not be looked at?

I don't think there are many builders that should definitely be avoided (in the second hand market) as they are all much of a muchness until you get to the elite few builders whose standard of work outstrips the rest by a mile.

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