What Does It Really Cost To Own A Catamaran?

Q). This question was posed:

"Gary one thing that I would like to get to grips on..is the holding/running costs of owning a Cat? Might you have that information??" A). Here is the condensed version answer....

It varies from person to person and by type of yacht...If Donald Trump owned the same boat as me, he'd probably see the need to spend double what I think needs to be spent.....if we are talking about a 20 year old cat that was not maintained well, then there could be major refit money needed justto make it insurable ... I have heard very general estimates of "10% of the value of the yacht on an annual basis". But that really doesn't make sense when you consider that a new boat has very little maintenance in the first year ...and boats are like cars...once they get to a certain age (7-10 years) all the components start to fall apart...so maintenance becomes a larger issue "late in the life of the boat"...you will find a discussion about holding/running costs at the end of my report I sent you...the major ones are:

- financing/cost of money...if you don't have a loan then it's the foregone returns you would have made investing the money elsewhere

- insurance (some people "self-insure" or get "liability only" coverage so you'd have little/no out-of-pocket expense)...for "full navigation coverage" it is 1.5% of the declared hull value (as an annual premium) if you go with a major underwriter. If you are not using the yacht for part of the year be sure and tell your agent to convert to "port risk" coverage and you may get a refund of half the premium for that period...

- dockage  (anchor the boat somewhere and that cost can be zero...stay in a fancy marina and it can be $20/foot per month...so, in the full service marina, a 40' cat costs $800+tax/month...I can find homeowners with docks behind their houses who charge $10/foot/month and you can save some money)

- maintenance (some people delay annual recommended maintenance but you have to be careful about that because sometimes it comes back to haunt you)...best to budget for bottom jobs, servicing sail drives/engines/new zincs, replace sails in year 5 (I know some sailors who can get 10-20 years out of a sail), periodic detailling-cleaning

- fuel is usually a minor expense on a sailing cat....not so on a power cat

When you narrow down a particular make/model I can quantify the expenses noted above so you know what dollar amount to expect...

One way some people eliminate the holding/running costs is to buy a new yacht in a charter fleet. They will have no expenses whatsoever for 5.5 years (the normal length of a charter program)...they will get a guaranteed income for 5.5 years (between 8-10% of the new cost of the yacht...So, if it cost $500k new, you get to $40k-50k/year in income for 5.5 years)...they use the boat when it's not chartered out....they can also use similar boats at 30 other locations worldwide...by the end of the program you either sell the yacht or sail it away ...

There you have it!