Owning two boats-Good idea? Bad idea?

[PrincessoftheLake]

For the past 3 years my husband and I have owned a 1985 Hunter 34 on Lake Superior in the Apostle Islands. When not using the boat, we kept it in charter with a local charter company. We have done well with it (the charter fees do help to offset expenses) and have been very pleased with our charter company. At the end of the summer here, two things happened. I got a new job with a huge raise and friends of ours offered us their 1995 Hunter 40.5 at a great price. We bought the 40 footer and now own two boats. The dliemma is this. We can afford to keep both with the idea that the 34 footer will be a full time charter boat and the 40 footer would be in charter part time. My bank says its a good idea and so does my accountant. However, before we really thought this through, a friend of ours came along and has offered to buy our 34 footer. No money has changed hands yet and there are a couple of things he wants fixed first. Since it has been a couple of weeks and I have had some time to think about it, I am thinking I'd like to keep it. Is it bad to back out of the deal? Is it a really bad idea to own two boats? Has anyone ever done this?Any feedback would be greatly appreciated.

 

[Bill O'Donovan]

Bad idea

This isn't like having two children, or ten. It's like having two houses, or in your case three now. I'd sell one and keep the other, if for no other reason than peace of mind. Consider the liklihood of having to sell both boats quickly perhaps, and you'll see what I mean.

 

[bob G.]

YOU KNOW BEST

Do "we" out here in the forum know as much as your bank and your accountant and you about your financial situation?

 

[lugeman]

if you have the time to commit

I think it is a decent idea, but the point of needing to sell both boats in a hurry is valid. I know that the Apostle Is. are one of the best areas on the great lakes for charter, and if you can expect bookings to be strong, sounds good. the time commitment of cleaning/maintaining 2 boats sounds like alot, but you would know that better than all of us out here. From a charter standpoint, how much longer can you expect a 1985 boat to be charter viable? What does your company say? Just thoughts out loud. Pray for wind, Lugeman

 

[Jack]

Friends,

I have to believe that you have thought about selling anything mechanical to family, friends or neighbors. Just my thoughts, good luck, Jack

 

[Dick Westwood]

Consider it as an investment

Since you're not planning to use the 34 footer, it's just functioning as an investment. I'd go one step further than Bill O'D.Owning more than one house can make sense as an investor. Your tenant pays the costs of mortgage etc. You profit from the appreciation. (While you assume the headaches of maintenance.)But boats don't appreciate in value. And maintenance can become even more of a factor.In your position, I'd think about how I could best use the value of the boat - the price you'll get when you sell it. In other words: if you had that money in your pocket today, would you buy a 34 foot boat or would you invest it some other way? What would give you the best return?

 

[Paul F]

enjoy the islands more

Years ago when we lived in Wisc., we had a sailboat in a partnership and a 19' runabout on Lake Michigan. It was the best of both types of boats. Recommend you sell the 34' and consider a motor boat for day trips. Easy to beach and enjoy the islands in a new way.

 

[PrincessoftheLake]

Thanks guys

Great feedback as always. Yes, the maintenance time is a factor but on the other hand my DH is self employed so he has the flexibility. Yes, business has been good on the 34 footer and it is very popular, I think because it is older and our charter rate reflects that. Our charter company would love to keep it in the fleet and they say they could keep it booked most of the summer, if it were available. On the other hand, how much longer is a 20 year old boat viable for charter? Another two or three years perhaps, which is certainly something to consider. Buying a boat from a friend (the 40 footer) was actually a great experience. The negoatiations went well and everyone was happy. In fact, the day we closed we all drove up to the boat and spent most of the weekend together. It was great to have him go over everything on the boat and explain it all to us. If we hadn't been friends, we would have probably been on our own. Decisions, decisions...*bzz

 

[Ross]

The 34 can be treated as a rental house

as long as you keep up with the maintenance you should be able to keep it in service for a very long time. Consider the simularities between houses and boats.Houses need interior and exterior paint periodically.Boats need new bottom paint and bright work care.Plumbing fixtures in houses need repairs at times.plumbing systems on boats need repairs at times.Furnaces and water heaters in housesengines on boats demand some care.Roofs on houses and sails and running rigging have a finite life and get replaced.Door knobs and hinges in houses and hatches in boatsdemand some attention from time to time.The structure of a house and the hull of a boat will last longer than the builder if some care is given to up keep.Your household furniture wears out and needs replacing as do the upholstered parts of your boat.If the 34 provides a positive income stream I would keep it.

 

[Sequitur]

Nothing wrong with two boats.

For six years we had a canal boat in France and an aft-cabin motor yacht here on the west coast. We commuted to France for two to three months at a time, and the rest of the year did shorter cruises in the Pacific Northwest. We sold the canal boat this spring, and ordered a new sailboat. I find nothing unusual about owning two (or more) boats at the same time.

 

[Steve O.]

If it were me...

You state that "We have done well with it (the charter fees do help to offset expenses) and have been very pleased with our charter company." I take "offset" to mean you are not actually making a profit after boat payment (if any), insurance, registration, slip fee, maintenance, etc etc? I'd keep the 34 only if it was making money for me--otherwise it's costing you money while making money for the charter company.

 

[Benny]

If you want investment property,

buy a house. If you are not going to use the boat do not miss an opportunity to sell it. You avoid broker fees, perhaps a survey and cosmetic repairs. The difference between your charter income and the total cost of maintaining the boat was your cost of sailing. Eliminate that cost of sailing on the 34 and you will lower your current cost of sailing having two boats. Don't wait until you may have to replace the engine or other major refit, sell it now and make your friend happy. Tell your friend it will strictly be a business deal and that no he can't do any repairs or upgrades until payment has been made and title transfer. Clear deals save friendships. We keep three boats but use them all at different venues. One is a small trailerable which we take all over the nation.

 

[ted]

add it up

it was mentioned already but I'd like to second the idea...add up the profit you will make from charter. compare that with the interest on the money you would take in from the sale. which will give a better return? there's your answer. and be honest about the total cost of each option.If the sale of the boat will net you a similar return as the charter then sell it because the labor + depreciation aren't worth it.

 

[abe]

I second Benny, take the money an run. Buy real

rental property. A boat will only depreciate. Keep the 40, sell the 34 while you still can. You can put the 40 on the rental fleet if you want. abe

 

[Stu Jackson]

Keep your friend(s)

bob G in #2 said it best.Good luck,Stu

 

[Augie Byllott]

Keep or sell?

If it was my problem, I'd ask myself the following question.Is the '34 a self-supporting, cash producing asset or an expense generating liability?Even if there is a positive cash flow, unless there is a continuing investment in maintenance and upgrading, the value will continue to diminish.I lean toward selling.Bite the bullet, take the cash, and let your friend have the enjoyment you can no longer get from this boat.

 

[PrincessoftheLake]

Well, I am going to sleep on it

tonight but I am leaning toward selling the 34 footer. I am kind of sad about it because I love that boat but I am afraid it will become a liability at some point in the near future. The cash we will take out of it will pay for some upgrades on the new 40.5. Thanks, you have all been great and I really appreciate the feedback.

 

[Tim]

Just remember...........

...........an "extra" boat is a happy problem. Good luck with your decision.Tim

 

[Chuck]

Two Boats

I tried this and it didn't work out for me. We attemted to charter a Catalina 34 and an O'Day 28. We had a lot of action on the 34 and very little on the 28.It just became too much of a hassle to charter and the charterers we not too careful of anything on that boat. I was trying to do repairs between charters and basically lost my summer to just doing this. It wasn't fun especially if you don't need the money. I decided at the end of one season to sell the Catalina and keep the O'Day but suddenly a Cal 33 became available so I bought that too. 3 boats but by this time I had the O'Day up for sale too. One winter with 3 boats, a little crazy, but it all worked out. We finally sold the 34 and the 28 and now we are enjoying sailing again without the crazy people.So, I say sell your 34 and enjoy sailing your 40 because it's not worth the money and headaches.Good Luck,Chuck

 

[abe]

"Happy problem"..so is a wife and a side honey..

Till, they both start getting too old, costing too much money, and becoming more difficult to get rid off. The more you wait the more it will cost....and at the end you really might end up loosing alot.abe