Dave, good point you made about depreciation and opportunity cost. They're
big elements in the cost of running a new vessel, and the reason why big
charter companies have 3 or 5 year 'yacht ownership schemes' - whereby Mr
Joe Soap owns the boat and takes the financial whack, while they only have
to contribute the running costs.

For a second hand vessel the depreciation element is smaller, and the cost
of commissioning can be lower - if it's inventory has been kept in good
shape. And that inventory of equipment (rigging, motor and all) will
represent about 30% of the value of the vessel . . . so checking it's status
is very important in the total purchase price, and the cost of that first
commissioning.

I bought a 40.6 ft boat in 1996; it was 8 years old, equipment rather run
down, but a quality hull and interior (Oyster). Price, £97,000 after
knocking off an obvious £10,000 for replacement kit. A further £10,000 spent
over the next two years catching up with items which were not detected on
purchase - so, £20,000 commissioning, bringing her up to scratch. Total cost
of purchase - £117,000.

From then on, living aboard 8 months a year and cruising very actively,
doing most labour myself, cost of running the boat (mooring, fuel, running
repairs to maintain value) in northern Europe averaged at £11,000 a year for
5 years, then £8,000 a year in the Mediterranean, average £10,000. (berthing
and hauling costs in the Med were much cheaper than UK)

I then sold the vessel for £97,000 - in good order. Depreciation = £2,000 a
year, then add inflation at 2.5% pa, = £3,000 a year, total depreciation
£5,000 pa. (Opportunity cost at 5%, £6,000 a year, not included.)

Total cost of running the boat without opportunity cost - £15,000 pa, say,
13% of the capital cost of buying and commissioning to my standard.

Just multiply by 2 for $ . . . and fiddle with the capital values a bit,
'cos Europe is an expensive place at the moment.

Where did we go? that's all on my website . . .

--
JimB
Google 'jimb sail' or go www.jimbaerselman.f2s.com
Compares Cruise areas of Europe
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