A friend is selling a boat that we are thinking of buying, its for sale for $85000 so its a significant amount of our savings if we were to buy it.
Its a 7.2m Cairns Custom Craft, built specifically to be a trainable live aboard boat for the tropics. Its powered by a 240hp Yanmar diesel.
It has only done 260hrs and the boat is in immaculate condition, it was professionally built at a cost of around $200,000.
CONS
Its sooner than we planned to buy a big boat
Its not as big as we would have liked
It is a loss of investible capital
We might not use it much in the next few years
It will increase our budgeted spending each year
We will get a lot of new 'friends'
PROS
Its here
Its liveable and trailerable
Its economical to run
Its in incredible condition, the odds of finding another like it, in town, at a later date are remote. The cost of getting something similar here from out of town is likely to be over $15,000
By having it now we could use it for up to 1 week trips while Kai is busy with finishing the last 3 years of school
Even if we don't use it much it will not deteriorate much as its in such good condition
The ability to have the insect screens all round the cockpit is pretty unique.
ALTERNATIVES
Spend $15,000 per year on a charter or fishing camp based holiday
Wait and buy something later
Buy a newer better small boat
Do nothing
WORST CASE SCENARIO
We don't use it, we don't enjoy the lifestyle it offers as much as expected, we realise it was the wrong boat for the job. We have to sell it and lose a significant amount of capital.
BEST CASE SCENARIO
It turns out to be perfect for what we want to do and we get to explore much more of the coast and transition to retirement thru it.
OPTIONS
Buy outright ourselves
Go halves with Dave
OTHER CONSIDERATIONS
Insurance.
FURTHER THOUGHTS
I have spoken to as many people as I can think of about this boat, and basically looked for non-confirming opinions, reasons not to buy the boat. The consensus seems to be that it is a good boat to buy. Also looking extensively at all boats for sale in Australia I cant find anything as good as this for anything like this price, there are cheaper similar boats but they need a lot of work done - and they are not here.
Talking to Brad Smith he says that the minimum cruising speed you need up here is 10kts and there is almost nothing on the market that is bigger and roomier - and cruises at 10kts, they are either slower (6-7) or much faster with a much higher fuel burn than I want. Brad suggested that around 10m gives you more room while still being able to be pulled out on a trailer and stored at the yacht club. I cant find anything in that category - at any price so its rather achademic. The closest is a BlackWatch 26 in Perth I have considered, but its more fuel burn - 30lt/h at 20knts, for sale at $79k, plus needs a trailer, $10k? plus its in perth so maybe $10-15k to get it here.
Brad also pointed out when its shit here no boat is comfortable - even the 20m Hama Pearl 3 was uncomfortable when it really blows!
Charlie Bronson also couldnt come up with any reasons not to buy it, he pointed out how well built CCC boats are, how well they ride and how suitable the boat is for a couple to spend extended time on. He pointed out that even when its not that nce here, once you get round the corner from Wilberforce, you have a hundred miles of protected coastline from the SE's.
SECOND LEVEL THOUGHTS
How will our lives be impacted if we buy it?
There will be some negative financial impact, offset by the opportunity to spend more time exploring the coastline further from home.
How will our lives be impacted if we dont buy it?
In reality, the impact will be minimal, or at least un-noticed, as we wont really know what we are missing and we are very happy with our lifestyle as it is
CONCLUSION
If we make a formal offer, I am thinking of going in at $70k with an upper limit of $75k
Interesting observation - in my past I would have looked at a new shiny thing and because i had very high disposable income, low fixed costs and easily available debt i could service, I would have bought it on implulse. I would have figured, "I can afford that because its only another $200 per month"(example) - but now that I have no debt and it has to be serviced out of real, hard, green money that we actually have, its psychologically a much harder decision. I really dont want to give all that money to someone else....for anything!
Its a good insight into why we become so easily indebted and how it snowballs because we dont really think about spending the actual amount, just whether we can afford the extra repayments.
UPDATE 15/6
Brad & Kim came over and talked about this boat, and boats in general for a couple of hours, they have an 865 Haines they bought last year that is quite a similar boat and their lengthy experience in charter and commercial boats is invaluable, Brad has worked a lot with Yamars and rates them very highly, once again thy were really unable to add any negative opinions about the boat. Brad offered to have a look over the boat from a mechanical perspective, so we went and did that. He couldnt fault the mechanical aspects but more impressively he was blown away by the boat in looking over it. He was amazed by the space and the quality of the build. He said it was actually much more like what he had in mind when he found and bought the Haines last year and admitted that had he not bought the Haines I would be competing with hi to purchase the boat! Hw felt that even at the asking price it is good buying.
His reaction was so positive that I put in our offer of $70k this afternoon. We will see how it goes!
UPDATE 19/6
Got back to Craig about our offer, turns out the other guy looking at the boat, a doctor from Yirrkala, has offered very close to the full price. He is away now for a couple of weeks in Bali so we have time to carefully consider our options. Talking at length to Craig its pretty clear it will basically take $85k to buy the boat. This is more than I had wanted to pay, but I guess it really focusses the decision! As my friend Chris pointed out, given that we have established the boat is definitely worth the asking price, the only questions that remains are do we really want to own a boat of that size at this time and are we comfortable spending that amount of our capital at this time.
UPDATE 23/11/21
Well as we know we bought the boat, for the $85k asking price and here we are now 4.5 years later and about to sell her as we have bought a much larger boat, a 46' 14m sailing catamaran!
Its fascinating to read my thoughts 4.5 years ago, I must say I am very proud of the process and how strong it was all that time ago!
So we spent about $20k on the boat over those 4.5y and I am guessing a fair bit more on fuel, maybe a total of $25k plus we will sell her for $80k so a small capital loss of $5k. That means a total cost of ownership of around $7k a year. The alternative we considered at the time of purchase - Spend $15,000 per year on a charter or fishing camp based holiday Is double that amount ( and in hind sight unrealistic as it would have been nearer twice that.
Interesting to see the original "best case scenario" - It turns out to be perfect for what we want to do and we get to explore much more of the coast and transition to retirement thru it. - Not too far off the mark!
The worst case scenario - We don't use it, we don't enjoy the lifestyle it offers as much as expected, we realise it was the wrong boat for the job. We have to sell it and lose a significant amount of capital. - turns out the lose of capital was insignificant - $5k!