Buying a slip before the boat

[ice_k9]

I am thinking of buying my first boat - a 24-26" cruiser. I don't mind paying for the boat, but the monthly slip fees are a killer in my area (Washington DC). While I am still shopping for the perfect vessel, I was thinking of buying a slip in one of those condominium slips.

http://www.fairfaxyachtclub.com

My reasons for doing this

-Its tax deductible for me
-Slip costs are bound to increase
-Nice way to build equity
-Once paid off (in a few years), I don't have to worry about slip fees ever.

I was planning on getting a bigger slip (40x14), so that I don't outgrow it in a hurry.

Am i nuts?

 

[CATransplant]

Re: Buying a slip before the boat

It could make sense, or it could be a bad move. I see that slips in the size you're talking about seem to be going for about $75,000. That's a pile of bucks. If you can't pay cash for it, there's the interest to consider, too. How much are the condominium fees per year?

Are you sure you're going to be in that area for years? If not, what happens if the economy is bad when you need to sell your slip? What happens if there are a lot of vacant slips and the income can't support the constant maintenance such a place needs? What happens if some government jurisdiction decides that the marina is polluting the river and has to go.

You're not actually buying anything, it seems like to me. You get the right to use a little chunk of water.

I sure wouldn't do it.

 

[tashasdaddy]

Re: Buying a slip before the boat

buying slips has become a way of life in Florida. much more econmical. there is more demand for slips here than there are slips. there is only one place here that has vacant slips, because it has no security.

 

[tommays]

Re: Buying a slip before the boat

You are smart to be looking into all the costs BUT having lived in a condo and doing a brief read on the rules of this place


Your going to be dealing with people telling you how YOUR boat should be kept and i amd sure they wont like older ugly ones

 

[marine4003]

Re: Buying a slip before the boat

It could make sense, or it could be a bad move. I see that slips in the size you're talking about seem to be going for about $75,000. That's a pile of bucks. If you can't pay cash for it, there's the interest to consider, too. How much are the condominium fees per year?

Are you sure you're going to be in that area for years? If not, what happens if the economy is bad when you need to sell your slip? What happens if there are a lot of vacant slips and the income can't support the constant maintenance such a place needs? What happens if some government jurisdiction decides that the marina is polluting the river and has to go.

You're not actually buying anything, it seems like to me. You get the right to use a little chunk of water.

I sure wouldn't do it.

Locally, slips go for around 125K, and have been selling for that amount for years...never appreciate...never depreciate..BUT there are always lots for sale,or re-sale actually, so the investment aspect doesnt exist..here that is, But, depending on what yearly slip fee's are,compared to the monthly payoff on 75K + interest..at what point,financially,does it make sense?
I'm with CAT.

 

[tashasdaddy]

Re: Buying a slip before the boat

a 40 ft slip here is $550 per month plus utilties.

 

[country_bumpkin]

Re: Buying a slip before the boat

a 40 ft slip here is $550 per month plus utilties.

Ouch! I pony up 195 a month for a 30' x 14' slip. All the electricity and water you can use.

Even at 550 it would take 11 years to break even.

 

[ice_k9]

Re: Buying a slip before the boat

Even at 550 it would take 11 years to break even.

Aren't you forgetting
-Slip rental prices go up with time
-Buying a slip builds equity

??

 

[642mx]

Re: Buying a slip before the boat

My wife's Grandfather has a couple slips at Barkley Lake, occasionally we use one of his for the weekends we boat down there. I asked him once what they where worth, and he told me he gave $40K a piece for them. I just about crapped in my pants.... I had no idea they cost that much.

 

[OldePharte]

Re: Buying a slip before the boat

Before buying a hole in the water -

Do the slip prices do in fact go up in your neck of the woods? We thought home prices would continue to go up every year.

I scanned the By-Laws, but can you sell your slip to anyone or does the association have any input?

Are you prepared financially to shell out any special assessments?

 

[salty87]

Re: Buying a slip before the boat

a 24-26' cruiser as a first boat is ambitious. towing one isn't fun, i couldn't imagine doing that for far anywhere near DC. so you probably won't even have have a trailer? that means you're on marina fuel, slip expense, boat payment, insurance...

we haven't even gotten to the probable expenses associated with getting a reasonable priced (cheaper) cruiser into reliable condition. after all, if you can swing a newer boat then the slip probably isn't a huge concern.

the learning curve can be steep when you add fresh water system, head/holding tank, stove, generator, inverter...?

slips probably don't depreciate, neither do boating costs. how serious/close to buying the boat are you?

 

[marine4003]

Re: Buying a slip before the boat

Aren't you forgetting
-Slip rental prices go up with time
-Buying a slip builds equity

??

Supply & demand,right now,the market for slips is dead,and will stay dead for a while yet,slips are not like homes,and depending on your location,have stagnated.in Fla,where there is year around boating...it makes sense...in DC where its a 7 month (at best) season it makes more sense to store for Nov - May,and if its not being used,why pay? Equity? Naaa,figure on 550 a month for 11 years,and thats not taking into account all the other costs mentioned above, find a marina that does dry storage,call before you leave the house..its floating when you get there,return..it gets cleaned and re-stored.wet slips make sense in year around climates,but Up north????

 

[tashasdaddy]

Re: Buying a slip before the boat

covered wet slips here are around $1,000 month and up. i prefer dry (rack) storage, if the boat is small enough.