Houseboat Fractional Ownership

[Delawaredave5]

Anybody have experience in "fractional ownership" for boats ?

Believe these arrangements have been used for years by groups of people to buy private planes, etc.

Ideally I'd like to get a "fractional ownership arrangement" with 3 other folks for a houseboat. Having 25% of the year to access is more than I'd need - and the ability to share costs is appealing.

If anybody has any "sample agreements" for this, I'd be interested. I've researched on Google - didn't find much.

Obviously a lot would need to be "spelled out" - access, repairs, upgrades, decisions, insurance, liability, and ability to exit/unwind.

Thanks !

[youbet]

Originally Posted by Delawaredave5

Obviously a lot would need to be "spelled out" - access, repairs, upgrades, decisions, insurance, liability, and ability to exit/unwind.

Thanks !

Sorry, no personal experience. But I think your last line says it all! Unlike a private aircraft where your fellow owners are highly trained, licensed pilots who risk death if they mis-behave, your fellow boat owners may be incompetent, drink-and-drive, party-going folks who couldn't afford a boat of their own and want to partner up with you.

I have noticed listings on Craig's List here in Chicago looking for boat partners. Most seem to have one partner owning the boat and the other paying him a fee for so much use of the boat during the season.

You might get lucky........ or not.......

[cute fuzzy bunny]

They arent that expensive to rent.

I'm impressed with the houseboat. All the issues of boat ownership and motor home ownership, all rolled into one.

[Leonidas]

Originally Posted by cute fuzzy bunny

All the issues of boat ownership and motor home ownership, all rolled into one.

Plus "...your fellow boat owners may be incompetent, drink-and-drive, party-going folks who couldn't afford a boat of their own..."

Sounds like a blast.

[mh]

Originally Posted by Delawaredave5

Anybody have experience in "fractional ownership" for boats ?

Believe these arrangements have been used for years by groups of people to buy private planes, etc.

Ideally I'd like to get a "fractional ownership arrangement" with 3 other folks for a houseboat. Having 25% of the year to access is more than I'd need - and the ability to share costs is appealing.

If anybody has any "sample agreements" for this, I'd be interested. I've researched on Google - didn't find much.

Obviously a lot would need to be "spelled out" - access, repairs, upgrades, decisions, insurance, liability, and ability to exit/unwind.

Thanks !

if it was me i would rent "on demand".
if i found myseld renting more than N times a year
where N is *markedly* more expense then a fractional deal, then maybe investigate fractional ownership...

[chinaco]

I would consider renting before partial ownership.

I do not think I would buy one. I owned a boat before and found that I was far enough away from the Lake that I could not use it regularly.

[Delawaredave5]

Originally Posted by youbet

I have noticed listings on Craig's List here in Chicago looking for boat partners. Most seem to have one partner owning the boat and the other paying him a fee for so much use of the boat during the season.

I'm looking on CL. I don't want to be the "sole owner" with other partners for liability reasons. Being the "non-owning" partner would be fine assuming the fee would be reasonable. Good idea - thanks.

Originally Posted by chinaco

I would consider renting before partial ownership.

I do not think I would buy one. I owned a boat before and found that I was far enough away from the Lake that I could not use it regularly.

I've had boats over the years (and know all the jokes) - so I know what I'm getting into.


Renting doesn't work because:

1. I'm looking for irregular "night here and night there" - renting is upfront week or weekend commitment.
2. I can't find any commercial houseboat rentals on Chesapeake bay
3. Cost to rent is around $1,500 / week. I'm hoping I can find a partnership on used boat with 4 partners for $3,000/year per person (slip, maintenance, insurance, etc).

[teejayevans]

Originally Posted by Delawaredave5

I'm looking on CL. I don't want to be the "sole owner" with other partners for liability reasons.

you definitely would want an LLC and have the boat in it to
limit liability, so if one of your partners did something bad, the
most you could lose is your share of the boat. Note that if
you do something bad, the LLC doesn't protect you.
Tom

[chinaco]

Originally Posted by Delawaredave5

Renting doesn't work because:

1. I'm looking for irregular "night here and night there" - renting is upfront week or weekend commitment.
2. I can't find any commercial houseboat rentals on Chesapeake bay
3. Cost to rent is around $1,500 / week. I'm hoping I can find a partnership on used boat with 4 partners for $3,000/year per person (slip, maintenance, insurance, etc).

I thought about the same thing with a vacation home at one time and abandoned the idea. Too much hassle trying to coordinate and make sure everyone is paying and keeping the place up. Additional expense surprises, etc.

IMO - If you want a boat... buy used and go it alone.

Here is a consideration. Determine the total cost of ownership for 5 years (cost of the boat, slip, insurance, repairs, etc). Subtract an estimated amount you would net from the sale of the boat at the end of 5 years. Then estimate the number of nights you believe you will use the boat (high range and low range). Determine your average cost per night. You may decide that it is less cost and hassle to rent. But the downside may be that you need to plan your outings. The difference between the rental cost and the cost of ownership is the money you are paying for the convenience of just showing up to use the boat.

If you buy the boat let us know how the partnership works out. I have wondered about it myself... just been a little concerned about the hassle.

[HFWR]

A group of old friends go houseboating in Kentucky every year (Booze Cruz '05). The rentals boats we've used are not ideally suited for one or two couples. The "bedrooms" are small, though numerous. But the kitchens and "living" rooms are decent sized, and reasonably equipped, and some have a hot tub... (Cue Eddie Murphy James Brown)

As for fractional ownership, no clue here. But you could take a cue from one of my cousins, who married the daughter of an oil tycoon, so he has a very nice houseboat, plus the big house on a bluff overlooking the lake...

In all fairness to him, he retired from the AF as a O-5 or O-6, so probably has a few dollars of his own.

[tgotch]

Here is a forum about houseboats I read a lot.

You might want to post your question there. Maybe someone on the forum has experience with fractional:

Houseboats For Sale Vacations and Rental - Forum List - Houseboat Forum

[Grizz]

I can't help but wonder if houseboating will go out of favour rather quickly with the huge increases in gas prices. I've rented a couple of times and these things really chew through the petrol. I've heard on CNBC that motorhome manufacturers aren't doing very well right now, and I would think that houseboats might fall into the same category of discretionary spending.

OTOH these were some of my favorite holidays....at least the parts that I can remember.

[Delawaredave5]

I think houseboats get only 1 or 2 miles per gallon.

While that sounds outrageous (because it is), most houseboats aren't used for "cruising" much. I've seen a bunch with non-working engines that the owners use at "floating condos".

I want a houseboat with "working propulsion" - but won't motor far from marina. I'd envsion going a mile or two from marina to a cove for a quiet weekend.

[kcowan]

I have rented a couple of times in The Thousand Islands. Definitely a great way to vacation in areas where there are not great hotel selections. Other boaters consider houseboat renters to the the lowest of the low. So stay away from the yacht clubs!

A friend bought a fractional from Three Buoys in Florida. It seemed like a good idea but he lost his shirt.

[ls99]

The short version: I would not even consider fractional boat ownership.
Years ago had a 27' Jersey skiff, in a Hudson river marina in Piermont NY.
Upkeep is constant, if you can't do your own work, big buck$ for marina mechanic$. In a group setting everyone wants the fun parts -only.

If occasional use, better off renting.

[Delawaredave5]

Originally Posted by ls99

if you can't do your own work, big buck$ for marina mechanic$. In a group setting everyone wants the fun parts -only.

Great point. Boats I've had always had "tinkering". How you'd "value" a partner's "contribution" to work on the boat -- that's tough.


I'm loosely talking with a couple guys who have houseboats around either:

1. Doing a "fractional ownership" deal with them, or
2. Me doing a "rental commitment" to them -- where I'd agree to "buy" annually 20 nights (or some number) per year at $xx/night

The "rental commitment" approach would be easier to implement and not be complicated by valuing the asset, agreeing on maintenance, unwind provisions in agreement, etc.

[ls99]

Timing is everything, a "special" weekend or time slot such as holiday, my be a conflict. If you can't use it when you have time......

[youbet]

Originally Posted by Delawaredave5

Me doing a "rental commitment" to them -- where I'd agree to "buy" annually 20 nights (or some number) per year at $xx/night

To me, this would be the way to go. Pay enough to really make it worth it to the owner and then be a responsible renter. Enjoy yourself but whenever you've had enough, you just don't sign up for the following year.

[cute fuzzy bunny]

Do also check with your insurance company on any rate changes as a result of either boat ownership or shared boat ownership. You may find that your umbrella liability and homeowners liability costs are going to shoot through the roof, and if you have a high end policy thats usually given to low risk customers unlikely to file a claim that you no longer qualify for that status.

Buying a big trampoline for your backyard often does the same thing...

[sailor]

Originally Posted by cute fuzzy bunny

Do also check with your insurance company on any rate changes as a result of either boat ownership or shared boat ownership.

Please do check, but this not has been an issue with my umbrella itself.
They did require at least specific level of liability for boat (100k) and plane (300k). The price of umbrella was not affected.
While they were not enthusiastic that my boat insurance was with another insurer (trying to up-sell me theirs), they did not give me any problems.