Buy Now???

[huruta]

We are pretty fiscally conservative (save ~30% salary per year), in our early 50s, and buying our mid-2000s Nordic Tug 32 was HARD. It's a beautiful boat in great condition, but also $$$ - at least for us. It's also our first ever boat. We did not want a project, wanted something to go to Alaska in (eventually) and didn't want to trade up - we more of the 'buy once, cry once' type. We hope to retire in 3-5 years. It was an expensive purchase and an unknown quantity (we've chartered, but are still pretty new to boating), and given the uncertainty in the market (stock and boat buying) we gave it a lot of thought.

At the end of the day, we jumped. We used discretionary funds and got exactly what we wanted. We haven't bought any other large ticket item since our house >10 years ago, and decided to go for it (the 'can have whatever you want, but not everything you want' mentality). So far so good! We don't have any regrets, are on our way to new adventures. We've travelled internationally a lot, Covid excepted, and decided we'd rather travel on water in our beautiful area (pacific nw) so rather than $$$ on trips to europe, asia, beyond we will be in the water in the PNW. Will the same boat be cheaper in the next few years? Could be, maybe not. I guess some of the YOLO effect played a part as well. We aren't getting any younger and want to explore the world while we can.

Anyway, just one perspective from someone who is careful with their money but tries to balance that with the 'you can't take it with you' reality.

 

[Fletcher500]

No one knows what will happen to asset prices in the current macro economic environment. It’s just another cycle we need to ride out. But I wouldn’t expect massive declines in boat prices as some are noting unless the geo political risks overseas continue to ramp up or a very severe (not a mild one) recession occurs.

We have never lived beyond our means and our boat was a big purchase for us as well. We justify the whole boating thing because it’s a second home for us and we spend up to 50 percent of the time living on it. I departed our home port on July 8 th and have been cruising between SoCal and the Central coast ever since then and will not be returning until mid November.

 

[socalrider]

If you are confident in your forward view on the market, you should be betting on it with your financial portfolio, not your boat purchase timing. If you're right, the gain/loss in boat value should be immaterial.

 

[SteveK]

Carpet diem anyone else.
I was happy with previous boats and happy with current one. Always lived for today as tomorrow may not.

 

[socalrider]

No one knows what will happen to asset prices in the current macro economic environment. It’s just another cycle we need to ride out. But I wouldn’t expect massive declines in boat prices as some are noting unless the geo political risks overseas continue to ramp up or a very severe (not a mild one) recession occurs.

We have never lived beyond our means and our boat was a big purchase for us as well. We justify the whole boating thing because it’s a second home for us and we spend up to 50 percent of the time living on it. I departed our home port on July 8 th and have been cruising between SoCal and the Central coast ever since then and will not be returning until mid November.

Were you in Cat Harbor mid to late August? There was a nice Helmsman on a mooring ball while we were there; meant to swing by but never did.

 

[Fletcher500]

Were you in Cat Harbor mid to late August? There was a nice Helmsman on a mooring ball while we were there; meant to swing by but never did.

Hi SCR, yes that was me. We’re you anchored outside the N line? I was wondering if that may have been you when I saw all of the kids in your avatar. By the way, it was great to see them all jumping into the water off your boat and having a blast. I grabbed one of your dogs outfits that was trying to escape while I was paddling and briefly said hello to your wife.

 

[FIRE]

"BUT, I am happy to be where I am at"


Sounds good to me!

 

[FIRE]

No one knows what will happen to asset prices in the current macro economic environment. It’s just another cycle we need to ride out. But I wouldn’t expect massive declines in boat prices as some are noting unless the geo political risks overseas continue to ramp up or a very severe (not a mild one) recession occurs.

AGREE - ...and if geopolitical risks continue to ramp we all may be happy we have a boat to shelter...

We have never lived beyond our means and our boat was a big purchase for us as well. We justify the whole boating thing because it’s a second home for us and we spend up to 50 percent of the time living on it. I departed our home port on July 8 th and have been cruising between SoCal and the Central coast ever since then and will not be returning until mid November.

Love this - Our plan is 50% on and off as well. While I am on the east coast at one time I worked for a company out of Fresno and loved my side trips to the central coast SLO anyone! Great towns out there.

 

[FIRE]

We are pretty fiscally conservative (save ~30% salary per year), in our early 50s, and buying our mid-2000s Nordic Tug 32 was HARD. It's a beautiful boat in great condition, but also $$$ - at least for us. It's also our first ever boat. We did not want a project, wanted something to go to Alaska in (eventually) and didn't want to trade up - we more of the 'buy once, cry once' type. We hope to retire in 3-5 years. It was an expensive purchase and an unknown quantity (we've chartered, but are still pretty new to boating), and given the uncertainty in the market (stock and boat buying) we gave it a lot of thought.

At the end of the day, we jumped. We used discretionary funds and got exactly what we wanted. We haven't bought any other large ticket item since our house >10 years ago, and decided to go for it (the 'can have whatever you want, but not everything you want' mentality). So far so good! We don't have any regrets, are on our way to new adventures. We've travelled internationally a lot, Covid excepted, and decided we'd rather travel on water in our beautiful area (pacific nw) so rather than $$$ on trips to europe, asia, beyond we will be in the water in the PNW. Will the same boat be cheaper in the next few years? Could be, maybe not. I guess some of the YOLO effect played a part as well. We aren't getting any younger and want to explore the world while we can.

Anyway, just one perspective from someone who is careful with their money but tries to balance that with the 'you can't take it with you' reality.

All of your comments ring true for us as well. When family has asked what I did to be able to be looking at such an extravagant purchase my early answers were that I worked hard...not necessarily true. My new answer is that I managed our money well, giving credit to reading Rich Dad Poor Dad at age 34.

 

[RT Firefly]

Greetings,
Mr. SK. Re: Your post #34...Just popped into my head (summer of '67)

 

[SteveK]

RTF, the good old days.

 

[Kawini]

If you have the financial resources to go for it now and your preferred boat is rare on the market, I’d say you have no choice to buy the first well maintained and fairly priced (given current market conditions) example that you find. It might be years before you see another one. As an example, I know that prospective purchasers of Selene 43s and 47s on the West Coast have been stymied for a couple years now as there are almost none that have come to market during that time.

You might not have the luxury of choosing to wait if your boat is rare and one comes to market. (That said, I’ve seen some asking prices that push the bounds of “reasonable” and “fair, even in the current market.)

 

[grahamdouglass]

I waited too long

It seems as soon as I bought the boat, my father needed care for the next few years and my kids aged too fast and out of interest in boating and my wife was never on board.

Don't wait too long on your dream. A boat loan can always be paid off.
Father time never gets any younger.

 

[ksanders]

It seems as soon as I bought the boat, my father needed care for the next few years and my kids aged too fast and out of interest in boating and my wife was never on board.

Don't wait too long on your dream. A boat loan can always be paid off.
Father time never gets any younger.

This is the post to read guys!

How many times have I heard this sad story repeated?

 

[Snug Harbor]

I've been a broker for 20 years, a boatbuilder before that. Just today I listed a boat for a gentleman who only used it for 1 season due to health issues that cropped up. I can't tell you how many times I've been through that scenario. It really makes you think about life, especially as you get older. Since you're shopping I assume you can handle it financially...stop listening to the news and go for your dream...but be smart and careful in the purchase.

 

[armando]

Am I insane to be considering the purchase of a substantial boat in the economy we are in right now? Especially considering every pundit and bank president alike seems to be indicating a global recession. This past week marks the first time many of the worlds central banks (10 of them including the Fed) all raised interest rates simultaneously to quell inflation. The world bank noted these hikes would have a "disastrous effect on the global economy". Anxiety anyone?

What I do know is that high quality well maintained boats are in very short supply and people seem willing to pay top dollar to get them. Will that mentality persist as the markets get more shaky? I am looking for a very specific boat and when they come up they are typically sold in short order for near asking price. So, the question I have is whether anything changes if the markets suffer as so many suggest (not the cost of money as I am a cash purchaser). Will those higher end boats come down substantially over the next 6 months?

Will I buy now and then cry in my Wheaties (6 months from now) because I should have waited just a little longer??? Does anyone know a boat buyers therapist?

Very easy: "the price is forgotten but the enjoyment remains long time"
This is our 6 boat. In some of them, waiting to buy we would have saved money,
BUT losing joy and feeling that we were missing something. NO doubt, go ahead !!

 

[2savage]

When it comes to retirement and finances, just get yourself a money management company and leave the work to them. As interest rates rise and stock markets fall, they know how and when to move from capital appreciation stocks to income bearing investments where rising interest rates are your friend.

As for the boat, as mentioned in an earlier post you may own an appreciating asset at best and one NOT depreciating as a norm. I believe the boat I bought a year ago is now worth more than I paid, but, anything is only worth what someone else is prepared to pay.

Life is short. Too many people delay then failing health takes away the dream.. Nike was right. "JUST DO IT'.

 

[jbloyd]

You've probably thought of this but...

Just a reminder. The cash you have on hand now will be worth about 10% less this time next year, at the current estimated rate of inflation. I would rather buy a $200K boat now than buy a $180K for $200K next year.

 

[Mike H]

If you are thinking of your boat as an investment, you are in for a big disappointment. Therefore, all the rules are discarded, and buy whatever if you want it and can afford to never see that money again. We bought our sailboat, our current boat, and my old Porsche under those premises, and we're still happy.

 

[Fletcher500]

Just a reminder. The cash you have on hand now will be worth about 10% less this time next year, at the current estimated rate of inflation. I would rather buy a $200K boat now than buy a $180K for $200K next year.

Most economists do not think we will have 8 to 10 percent inflation next year. Hopefully more like 3 to 4 percent, maybe lower. The high CPI numbers are mostly related to fuel, food, and autos. Other sectors are starting to cool a bit. The Fed is pushing hard after too much QE and low rates to stimulate the economy after Covid. So now they have their sledge hammer out with QT and continuing to raise rates which will dampen demand, slow consumption, reduce wages, reduce the wealth effect in the stock market, and some form of a recession. It’s no fun for anyone, but the medicine we get.

 

[socalrider]

Yeah, 10% inflation would be quite extreme over a full year. Also, note that 1-year T-bills, which used to yield basically zero, are at 4% now. So you don't have to have the cash sitting in a no-yield bank account.

I stand by my previous statement: if you can predict the future, adjust your portfolio, not your boat-buying plans.

 

[hmason]

We’ve been living aboard for 12 years. When asked if we have any regrets we say yes; we should have done it sooner. Hope this helps your thinking.

 

[MVDarlin]

Remember what George Foreman said. Retirement age is not important, retirement income is. I usually advise folks to add one extra year to their retirement plan to put a little better cushion on their finances. I retired at age 56. I have 2 boats, a motor yacht in MX for the winter and a sail boat in SE Alaska for the summer.

 

[Group9]

The time to buy is when you want a boat. They are rarely good financial investments, but, they can be tremendous mental health investments, and worth every penny!

 

[Comodave]

One thing to think about is that there a lot fewer boats on the market today in reference to last week in Florida. Also there will be a lot of Florida people looking to replace their boats. Is it enough to influence the market, I don’t know but it may.

 

[Art]

I guess you know what you want?? You have the money for it now, too... I guess?

Go forth and conquer! Before you get conquered and can go forth no longer...

Ill health as well as accidents can occur at the blink of an eye.

I recommend you get it on, asap!

 

[backinblue]

I never knew that logic and sound financial decisions had much to do with boat buying. When ever I bought a boat, I never expected any return. It was always bought with money that I could afford to lose, kind of like gambling, or vacations. Of course, if your boat is your home, it's an entirely different matter.

 

[hytedin]

For me the real issue of boat ownership isn’t the cost of the boat, but the docking and insurance.

To my knowledge, marina rates don’t go down regardless of the economy. And, so far insurance has demonstrated as much.

 

[backinblue]

There are many costs of boat ownership beyond the purchase. Either you accept that and feel the benefits are worth the cost, or don't buy a boat. I can't see how you'd make a sound financial case for boat ownership unless it replaces your house. Even then, it's probably a money drain, just less so.

 

[SteveK]

There are many costs of boat ownership beyond the purchase. Either you accept that and feel the benefits are worth the cost, or don't buy a boat. I can't see how you'd make a sound financial case for boat ownership unless it replaces your house. Even then, it's probably a money drain, just less so.

One of the things I have had to accept is not being able to use the boat as often as I would like due to other commitments, like work. In fact due to other factors I am on board maybe 25% of a year. Yet, I can justify ownership costs are outweighed by the benefits.
As a comparison, had a wonderful meal out last night at a cost of 3-4 home cooked identical meals, yet it was worth it to give the chef a night off.