Boat ownership costs and budgeting
How much does it cost to run a boat? Find out with the boats.com guide to budgeting for boat owners.
The costs of owning any craft are an important consideration when you are looking at buying a boat. There’s no escaping that boat ownership can be expensive, but if you count all the nights on board, days out and holidays afloat, it can still compare very favourably with alternatives.
An oft-quoted figure is that you should budget for a certain percentage – usually around 20 per cent – of the value of the boat to cover annual costs. On face value can make sense – the most expensive boats are likely to be kept in the most expensive marinas, while lower-priced craft will gravitate towards progressively cheaper moorings.
However, a number of factors have changed to make this rule of thumb one that can easily mislead potential owners. The biggest of this is a sharp decline in the value of many second-hand boats over the past decade. Of course, in many ways this is a welcome development for boat buyers, but it also means annual running costs could be a much higher proportion of the boat’s market value.
Moorings and insurance
Moorings are one of the most easily quantifiable costs, although you may need to do some legwork if you’re looking for a budget priced option instead of a glossy full-service marina. Prices vary considerable, depending on facilities. Even in the popular Solent area it’s still possible to find a mooring for a 30ft boat for well under £500 per year; on the other hand a prime location marina berth for the same boat could easily cost more than £6,000 for 12 months.
Find out more about different types of moorings in our guide to finding a mooring.
Insurance is rarely a major expense compared to the other costs of running a boat and is invariably significantly cheaper than for a car of considerably lower value. At the lower end of the market, it’s possible to get third-party-only cover from under £100 per year, while a standard fully comprehensive policy for a yacht worth £100,000 can be as little as 0.5 per cent of its value.
This is much more of a grey area and costs will vary hugely between different boats and even different owners with identical boats. If you plan on doing all but the most technical work yourself costs will be significantly lower than if a boatyard, marine engineer or sailmaker is engaged to carry out the work.
Even then, much money and inconvenience can be saved by ensuring you carry out routine checks diligently, including engine checks, rigging inspections and examining sails for the first signs of damage. The old adage that a “stitch in time saves nine” is just as applicable today as it was during Nelson’s time, so if you spot an impending problem before significant damage is caused, repairs can be quick, simple and won’t break the bank.
There are some tasks you won’t be able to avoid, including the need to replace sacrificial anodes and re-apply antifouling. As an example, if you do it yourself the cost for this will range between £100-200 for a 36ft (11m) boat, depending on the quality of antifoul used. If engaging a boat yard to do the work, this may vary widely depending on the yard’s labour fees, ranging from as little as £200 for labour to more than double that.
Many owners of cruising boats try to make antifouling last a couple of seasons, so that they can reduce the number of haul-outs necessary. The downside is that by the end of this time sufficient growth that will noticeably slow the boat is inevitable – while that might not be a problem for some cruising sailboats, if you own a power boat then the extra fuel used will far outweigh any saving gained through delaying a haul-out. If working to a budget it’s also possible to stretch funds by booking a haul out during the summer, when boat yards tend to be quiet and frequently offer significantly reduced prices, with the cost of a 36ft boat sometimes as little as £200.
Predicting the future has never been easy and the days in which you could be reasonably confident that inflation would be sufficiently high for a well looked after second-hand boat to maintain its cash value have long gone.
The big question is how much do we need to budget for depreciation? That’s a much harder one to answer, although a good starting point is that there are plenty of examples of boats that, once all the extras are priced in, lose around 50 per cent of their initial value over their first six or seven years. Beyond this age the figures start to become more muddied, partly because once a boat nears 10 years old some owners will already have started updating equipment.
For older designs that have relatively small accommodation compared to their overall length, the bulk of the boat’s value may be in the equipment and fittings – the engine, rig, sails electronics and so on. If these big ticket items are in need of replacement, then the boat may be worth very little. Of course, if you buy such a boat at a price that reflects this, then you won’t be paying much depreciation on the vessel itself, although you will need to budget to replace the equipment periodically.
See boats.com for a more detailed discussion of how to upgrade and improve your powerboat or how to upgrade and improve your yacht.
Upgrading and replacing boat systems
It can be very difficult to predict the likely service life of much marine equipment. However, it’s certainly prudent to build up a contingency fund from which to pay for essential replacements. I use the following rough estimates to budget for potential ‘big ticket’ expenditure, based on mid-range equipment and diligent maintenance.
Main engine (and diesel generators): 20 years
Mast and boom: 20-30 years
Standing rigging: 5 years (racing); 10 years (cruising)
Running rigging: 10 years
Deck gear: 20-30 years
Upholstery: 10-15 years (20+ years for foam)
Liferaft: 12 years
Lifejackets: 10 years
Batteries: 4-7 years
Electronics: 8-10 years
Sails: 2-5 years (racing); 10-15 years (quality cruising sails)
Teak decks: 10-15 years (potentially 20+ if never scrubbed)
Canvas work (sail covers, sprayhoods etc): 15-20 years
Note that differing patterns and amounts of use, maintenance schedules and quality of original components, will mean that there’s a wide variation in the life of each item between different vessels. In some cases items may last considerably longer than these timespans, for instance there are still many boats with engines and spars that are 30 or 40 years old, but most will have been changed or fully reconditioned by this time. In any case, this is one situation in which having a contingency fund that’s a little larger than might be necessary is never a disadvantage. See more in our boat maintenance guide.