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Old 04-20-2019, 11:53 AM   #41
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Letís not forget to factor in risk on either choice. Big house mortgage brings to mind the Great Recession. Big boat brings to mind hurricanes. In either case if you can carry both through lifeís challenges which hit all of us at one time or another, all will be good.
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Old 04-20-2019, 09:22 PM   #42
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I would agree with you. Rental property is a great investment. However, I know I am not cut out to be a landlord. I own two commercial buildings. One is entirely owner occupied but the other has additional tenants. Just that (rather painful) experience has taught me I'm not cut out for it. I greatly respect those that can do it well.
Thanks Dave- I've gotten pretty good at it over the 25 years we have been at it. We began purchasing old, run down dumps that we completely reconstructed. They are now all lead free with sprinklers and normally 100% occupied. I never want a phone call telling that someone was seriously injured or worse because of a fire.

Now as to commercial..........not sure I could do that. Wish you the best!
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Old 04-21-2019, 07:56 AM   #43
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We don’t finance boats (or cars). Other than real estate, if we can’t write a check for it, we don’t buy it. And, one of the reasons is, that it (they) is/are a depreciating asset. We have a good, but not extravagant, income stream through pensions and investments. Except for occassional part time contracting, I have been retired since 52.

As much as I would love to live on the boat the rest of my life, my wife has made it clear we will always have a house, and at our age (61), I agree, that she is right.

As a happy compromise, we like leaving on the boat, cruising six months to a year, and then returning home to rest and recharge, and be with family and friends. We plan to keep that routine up for as long as we physically can.

We have good friends who live full time on a 57 foot motor yacht (a beautuful boat) who no longer own a land home, a few years older than us, who are starting to have age and health (stroke and heart) issues that are not completely compatible with living on the boat any more. Their boat is four years away from being paid for and is worth a lot less than when they bought it twenty years ago. They sunk a lot of their capital into that boat.

I frankly worry about them and their future situation.
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Old 04-21-2019, 02:14 PM   #44
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We donít finance boats (or cars). Other than real estate, if we canít write a check for it, we donít buy it. And, one of the reasons is, that it (they) is/are a depreciating asset. We have a good, but not extravagant, income stream through pensions and investments. Except for occassional part time contracting, I have been retired since 52.

As much as I would love to live on the boat the rest of my life, my wife has made it clear we will always have a house, and at our age (61), I agree, that she is right.

As a happy compromise, we like leaving on the boat, cruising six months to a year, and then returning home to rest and recharge, and be with family and friends. We plan to keep that routine up for as long as we physically can.

We have good friends who live full time on a 57 foot motor yacht (a beautuful boat) who no longer own a land home, a few years older than us, who are starting to have age and health (stroke and heart) issues that are not completely compatible with living on the boat any more. Their boat is four years away from being paid for and is worth a lot less than when they bought it twenty years ago. They sunk a lot of their capital into that boat.

I frankly worry about them and their future situation.
I'm a strong believer in whatever your Plan A is, always having a good Plan B. I sure hope your friends do. Regardless of age or health, it just takes one event to change it all. We always consider "What if?"
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Old 04-23-2019, 09:36 PM   #45
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Very important make and complete all your boat buying and finance decisions while you still own a dirt home. Same for setting up self managed iras in retirement.
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Old 04-26-2019, 12:14 AM   #46
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I'm a strong believer in whatever your Plan A is, always having a good Plan B.
And a C and a D.
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Old 04-26-2019, 12:56 AM   #47
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Except for commercial vessels, I always went the boat route by buying what I could pay in cash. Not having bills makes a big difference when cruising. If you learn how to do your own repairs and maintenance you actually cruise rather cheaply.
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Old 04-26-2019, 02:10 PM   #48
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Never consider a boat as an investment.

David
Good advice. Never consider your primary residence as an investment either.
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Old 04-26-2019, 02:35 PM   #49
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Good advice. Never consider your primary residence as an investment either.
There is a difference between consideration and reality; a home is an investment. Nobody lives forever, it is an unusual home that does not appreciate over time. A home retains value that can be cashed in or left to others while the rent receipts that I give our tenants are worthless other than for the time window that is specified in the receipts.

The cost of ownership in most situations never equals the cost of living in a rental property.
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Old 04-26-2019, 03:26 PM   #50
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After a successful 44-year real estate career, we were able to buy and sell several homes and condo's during our lifetime, each time building more and more equity. Eventually, we were debt free ... and enjoying it. But I missed boating, having been a landlubber far too long.



As I neared retirement, with a budget of $200k, I began to research a boat purchase, with my wife's support, of course, and finally found a Monk 42. We had sold our mortgage-free home and wisely and conservatively invested our equity to create sufficient regular income on which to live comfortably.


I wanted to escape the responsibilities of home ownership and all it entails. Lawn and garden maintenance, snow removal, painting, repairs and frequent upgrades, not to mention ongoing monthly expenses, property taxes and periodic furnace and roof replacements.


Where do we live now? In a lovely rental building overlooking a small river that's walking distance to a downtown area and the lake and harbour. Nothing to do but pay the rent, and go boating on our loan-free vessel. BTW - in some markets, trawlers in good condition do indeed increase in value. And as boomers continue to retire, I believe this trend will continue.



Do I miss home ownership? Nope. Our investment portfolio is earning a reasonable return. And with our pensions, it's more than sufficient to pay our living expenses. Will our daughters inherit much when we finally check out? Nope.


My advice is this; once you've thought it through and done your number-crunching, follow your feelings. They won't lead you astray.
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Old 04-26-2019, 03:42 PM   #51
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One more consideration to add to the conversation - if you have a house with a mortgage, odds are that it is at a much lower rate than you will get on a boat loan, more so if the home mortgage is a few years old. Our home rate is 3.49% and we paid no points. There is no way we could get that today on a home, let alone a boat. In fact, we've decided not to pay it off early even though it is our only debt. Instead, we are directing all our excess cash flow into investments.
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Old 04-26-2019, 03:57 PM   #52
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As a young Sergeant in the Air Force I still wanted a larger boat someday and I really
liked the Burgers as they seemed well built and made in Wisconsin where I'm from.
Years went by and still no boat but eventually as a civilian I started work for a company that had a good profit sharing plan and I worked there for 13 years. After leaving I had
a little money, but not enough for a boat. By that time though I had decided that a sail
boat would be for me if I could ever afford it. More time went by, and with some good
investments my profit sharing money started to look serious. Meanwhile like most people, I also had a mortgage on a nice home. I bought a 40 foot ketch eventually and
have now had it for at least 15 years and over the years have spent many weeks on the boat. Here comes the problem. I have a house and a boat and no real obligations as
I don't have any children and my wife passed away a number of years ago. Still have
a mortgage with equity built up but the boat was purchased for cash. This being the case the boat insurance, registrations and upkeep plus slip fees are the only costs associated with the boat. I want to now live on it full time, but I still have the house.
I'm leaning toward selling the house not because of any money issues, but because
owning property also has it's downside in that I can't spend as much time on the boat
(full time) as I want to. Finding a property manager to take care of the house might be
an option. Is it worth it with all the problems that entails? Renters tend to not really
care and upkeep would maybe wipe out any advantages to keeping the property.
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Old 04-26-2019, 04:15 PM   #53
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Downsize.

Sounds like you're a prime candidate for a smaller home, maybe a condominium with zero exterior maintenance. Lot to be said for a place to call home, even if it's a condo.

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Old 04-26-2019, 04:22 PM   #54
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Oldsarge,

I would sell the house and move to the boat full-time.

We just sold our home of 25 years. Its value increased at a compounded rate of 3.5% per year. Taking into account ALL of the cost of home ownership: renovations, maintenance, taxes, hoa fees, insurance, I think we barely broke even and that was with me doing almost all of the renovations and maintenance. I think there are many great reasons to own a home, but as an investment tool isn't one of them.

We are currently renting a very nice house from a couple who relocated to Georgia. My wife and I take care of this house as if it was our own. Our rent covers the owners costs (at least for normal expenses) for the home. Having a property manager would end up costing them money. They do not make any extra income from the home, although it is slowly appreciating in value. While my wife and I are excellent tennants, some renters really don't give a crap. When we decide to leave (probably in 2 years), they have told us they will be selling the house.

I think you would be better off investing your equity and not have to constantly worry about your rental property.

Jim
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Old 04-26-2019, 04:31 PM   #55
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Downsize.

Sounds like you're a prime candidate for a smaller home, maybe a condominium with zero exterior maintenance. Lot to be said for a place to call home, even if it's a condo.

Ted
Definitely a condo for those wishing to escape maintenance. Just remember, there is no free lunch. Condo fees include maintenance just as a home owner can pay for services rendered.
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Old 04-26-2019, 04:40 PM   #56
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We own a boat along with a used to be large (today the homes around here are gigantic!) 4 bed home in a nice neighborhood for just Wifey and I. We would sacrifice too many things to even consider down sizing. Too large? No, comfortable? Yes. We also own apartments, 19 of them that we rent to others who choose to avoid home ownership.
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Old 04-26-2019, 04:45 PM   #57
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We have thought about the idea of "Selling it All" and living on a boat. Which would mean buying larger boat, as you mention. All of the comments made in this thread are "spot on" and cover many of our thoughts. Basically, I break into two parts - Financial & Desire.

The financial side is a no brainer - as mentioned from djmarchand, "Never consider a boat as an investment". Simply a depreciating asset. You really should not compare a house with a boat from a financial perspective. The only exception I see is that as a "2nd vacation home", a boat is nice as there is no property taxes on a boat.

The desire side, well that depends. Our desire, which still pops up one and a while is to travel the ICW to South Carolina for the winter months, living on the boat as a vacation home. The costs for off-season slips are reasonable.

However, I'm now semi-retired and after taking long boat trips with my wife, 3 months at a time, we have found that we both do like our time on land (at home). We enjoy time in NYC and time with our children. So, the balance for us is to stick with our current boat (which is 100 % paid for), take our 3-4 month trips (sometimes remaining in one spot for a month or so) and enjoy our home living for the rest of the year. This year we're heading up to Maine for the summer. Again, using the boat like a vacation home.

To answer your question about taking a large mortgage for the big boat, as some have mentioned, a boat is a luxury item. I wouldn't take a large mortgage for one.

Enjoy!
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Old 04-26-2019, 04:59 PM   #58
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I consider my boat a toy. One we can enjoy and one that if necessary, live without. It requires a very large boat to offer the comforts of a home, even a small home. Just my thoughts but to each his own.
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Old 04-26-2019, 05:20 PM   #59
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Downsize.

Sounds like you're a prime candidate for a smaller home, maybe a condominium with zero exterior maintenance. Lot to be said for a place to call home, even if it's a condo.

Ted
This is exactly our plan when we retire. Larger boat to travel but a small condo with no maintenance in a low tax state (probably NH or FL) as our home base and to store our things. Yes, you pay for no maintenance through fees, but in return you get more time. Once we get tired or are physically unable to to long distance boating, we will probably upsize the house and downsize the boat (or get a second condo and become snowbirds). Being that we are only in our late 40s, it is nice to dream.
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Old 04-26-2019, 07:25 PM   #60
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Here is another thought...

If living on a boat, and making that your only home makes you happy, do it. You get this one shot at life.

I “live” on my boat, but still own a home so I call myself a stayaboard.

Having spent time on my boat, and in my two story home, I can tell you that if you can navigate in a two story home, you can navigate in at least my boat. The idea of being too old for your boat really means that it might be time to move into assisted living guys. Yes as you age you might have to start hiring repairs out, but the same goes for home owners as well.

Regarding the investment, the lifetime of money in my home means zip, zilch, zero unless it gets sold, something I at least am not willing to make my wife do.

Same thing with a boat. If the value goes down, really who cares. Again, it means nothing unless you sell.

If your finances dictate making a choice of a house or a boat choose the one that will make you happy.

Look at the calendar. Look at your remaining years and be realistic with your self as to what you want out of your remaining time.

My goal... CUBAR 2021
I’ll be 59, and ready to play.
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