Hey,
I was wondering what everyone thought about Marina Berths as a potential investment?
I found a 10m berth (referred by a member of this forum) that costs $50K and returns a healthy $140p.w
My only worry is that I would not be able to monitor a berth as closely as I would like if i bought a berth in the Sunshine Coast, and im down in melbourne?
All help would be greatly appreciated! [happy3]
What is there to monitor? Is a piece of water surrounded by a jetty on three sides and managed by the marina?
Do you own it freehold?
Cheers,
Simon Macks
Residential and Commercial Finance Broker
***NODOC @ 7.15% to 70% LVR***
[email protected]
0425 228 985Comments may not be relevant to individual circumstances. If you intend making any investment, financial or taxation decision you should consult a professional adviser.
For an investment I find it helpful to evaluate against 3 key crtieria. For me an investment needs to forfill all 3 to even be considered.
Capital appreciation: does it have a history of increases, is supply limited, is demand sustainable
Income: how much, how reliable, how much gets eaten by running costs
Collateral: Will banks lend against it, what LVR, what rate, what conditions
I would see a marina berth as being shakey on at least 1, and probably 2 of the 3 criteria. For me that would rule it out. However I don’t see a problem in someone having it as one of their “speculative” investments making up no more than 5% of a portfolio.
Well said shake.
Do not be seduced by good returns which because of other reasons will slow you down in the long term.
Derek
[email protected]
http://www.pis.theinvestorsclub.com.au
0409 882 958I would expect that running costs would be low, but as shake said, unless the volvo ocean race dropped into town, there would most likely be an oversupply of berths available it seems.
Thanks for the help fellas [thumbsupanim]
Well put shake. My brother-in-law just recently bought a boat and has it penned in a 30 ft bay. All of the bays are completely full and there is a waiting list of about 8 months at this point in time to get one.
If you buy a second hand boat from the guys that operate the marina, they guarantee you one, but it costs him about $ 75 p.w., which he says is great ‘cos he doesn’t have to haul it backwards and forwards all the time and launch and re-launch all the time.
I’ve had a squizz at the economics, and as shake says, as long as it doesn’t constitute a major portion of your portfolio, couldn’t hurt that much.
My love affair with “the dirt” would probably exclude me from investing in them, but if you are scraping around trying to find something that turns a buck – gotta be better than the 2 bed unit in grottsville.
My assumption is, and it seems to be true from the figures coming through, that with the general population becoming wealthier, discretionary spending towards boats seems to be a funnel in which the wealthy are placing some of their play dollars. Housing those play things may be a valid business opportunity.
Legal title and neighbouring pens rights / responsibilities would be a major due diligence point I’d reckon.
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