Should you buy a boat? It’s a big decision, but the current crisis makes it even more complicated and perhaps more desirable as holidays at home seem a lot simpler and safer on board your own vessel in the peace of a rural canal.
This is the second in a series of nearly a dozen videos looking at getting afloat on Britain’s wonderful canals and waterways which have been produced for Norbury Wharf Ltd, based on the Shropshire Union Canal in Staffordshire.
This second episode looks at the positives and negatives of becoming a boat owner on the waterways of Britain.
* Video Transcript*
“So the big question, well should you buy a boat. Now the market for boat sales have gone through substantial changes, we've been through a prolonged recession culminating in the national uncertainty over Brexit and boats tend to go up for sale when things aren't going well. They're underused assets, so will you be one buying something that's worth very little in the future, can you have faith in the future of the waterways now they're run by a charity, are you safer buying something secondhand that's already lost its premium price? Or is a new boat a better option? Where will the money come from and how do the sums add up?
So unless you're listening to a boat salesman, it's clear that owning a boat is not quite the investment today it might have been a couple of decades ago. When we bought our first boat over 20 years ago we didn't expect to make money on it as we could have done on a property but neither did we expect to lose as much as we knew we would on a new car, for instance. Boats sat somewhere between the house and the car and if you spent money on improving them you might even get some of that investment back when it came time to sell. Yet, boats aren’t bought and sold like houses then and now, they’re sold like cars and you stand as much chance of buying a boat with problems as you do of buying a road car and with as little come back. That's not aimed at frightening any prospective buyers it's just a reminder that buying a boat is very much a case of buyer beware. You need to be fully informed of what's on the market, exactly what you can expect to get from the broker and how much it's going to cost you over and above the purchase price.
However, there may never be a better time to buy a boat if things all go swimmingly, prices will shoot up once the country begins spending money again but let's start with where we are now. If you want to buy a boat of any sort from a surfboard upwards, you’re about to become part of the tiny 2.7% of British households which own a boat, that's according to the British Marine Federation, that's just over a million craft of some sort but six out of ten of them are canoes or small sailing boats or windsurfers even. The remaining half-million in round figures are mostly coastal craft of some sort, yachts and things. According to Canal and River Trust there are about 36,000-37,000 boats on their waterways and that's grown a lot since say, 2000, when there were around 25,000 of them. The number of new issue new licenses issued that Canal River Trust or British waterways before them, peaked in about 2008 at around 2000, since then it's nearly halved, so what do all those numbers tell us when it comes to deciding whether to spend your hard-earned cash on a boat now?
Well, first of all, it shows that this is really a small marketplace with just a thousand or two boats changing hands each year, check through the boating magazines and you'll see there are perhaps half a dozen big brokers dominating the Inland Waterways market, maybe two or three times that number of smaller operators, now most big towns have more car dealers than that.
The second point is that it is a buyers market at the moment, so there are people seeking to sell their boats more so than in the past, now that's partly because boating’s a hobby and has attracted many middle class, fairly well-heeled families who may be feeling the pinch a bit as public sector jobs go and pay is frozen and the future price of the house is not quite so rosy as it might have been. Simon Jenkins and those at Norbury Wharf, reckons prices are probably down 10-15% over the last couple of years and that's made the finance companies operating both mortgages very nervous and almost taken them out of the marketplace, but if you're unaffected by those sorts of factors it may be a good time to buy. There are bargains out there and the experts tell me there are even bigger desk discounts to be had at the top end of the market but do bear in mind that the cost of boat ownership doesn't stop when you hand over tens of thousands of pounds and become the new proud owner, it's easy to fall in love with the idea of boating and with individual boats but you have to know you can afford it.
Over a period of two or three years boats can fall in value but by quarter and you have spent around four and a half thousand pounds each year on actually keeping the boat afloat. Now that's a survey of boat owners, which shows that's their average spend. £2,300 on mooring fees, £900 on license fees, £500 on maintenance, £300 on fuel, another £300 on insurance, another £100 on safety work and of course those license fees were pushed up well above the rate of inflation for a number of years, although that's eased off now. We might see it again in the future though because Canal and River Trust has a fixed government income and deteriorating assets, so that's facing rising costs and many fear those will be passed on to boaters. So if you've spent £40,000 on a boat you'll be paying out 10% of that initial investment every year and you also see over a period say, four years its value fall by £10,000. If you buy a boat for £30,000 keep it in tip-top condition we could probably still put it on the market for 30,000 with a couple of years turn but it's difficult to prejudge that and it's keeping the boat in the best possible condition will cost a lot more than just £500 on maintenance, you have to keep that paintwork sparkling and correct any faults that develop so you may well have paid out £6,000-£8,000 over a couple of years of using the boat. So even then, it's not a bad price to pay is it for several family holidays and a few weekends, about three or four thousand a year? - If you compare it with spending an equal time abroad. You won't be getting an appreciating asset but you will get a good boat, a good price and have a lot of fun!
So they're already fewer boats being used for cruising and travelling shorter distances. A few years ago around 200 boats a month were being bought across the inland waterways, currently, it’s probably half that and whether you become one of those buyers depends very much on your personal situation if you have the money available or the impeccable credit history you need to borrow it, then you have to be reconciled to paying out a few thousand a year in cost and depreciation in order to have several wonderful holidays and weekend breaks. So if you're in that position this really is the time to go for it but really they're all those words of caution have nothing to do with what's essentially an emotional decision, to buy a boat. All these facts and figures fall on deaf ears when people have really fallen for the waterways if you want to be a boater you'll find a way to buy a boat. The exceptionally low prices now available will just get you out on the water as quickly as possible, so come and join us, have fun!”