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“Boat” can mean a surprisingly large number of things. The types of craft that fall under the category of boat range from kayak to mega yacht. Clearly, how much a boat costs to buy and maintain depends on the kind of boat you have in mind. Here’s a look at some of the factors that will influence the purchase price of a boat as well as the upkeep costs.
What Is the Average Cost of a Boat?
Each type of boat has its standard price range. For example, a Jon boat, a flat-bottomed fishing boat commonly made out of aluminum, could cost anywhere between $500 and $3,000 dollars. The starting price of a sailboat is about $12,000. A fishing boat could cost up to $100,000, and yachts could set you back at least $300,000. With such a wide spectrum, the average cost of a boat doesn't mean much.Size, features, and accessories will go a long way in determining how much you’ll ultimately spend as boats can come in basic models or fully decked out.
What Factors Impact the Cost of Boats?
The reasons for cost are sometimes obvious, but sometimes not.
Size
Size may be the most obvious factor that will play into the cost of a boat. Generally speaking, the larger the boat, the more you’ll pay.
Brand
Much like with a car, the price of a boat will vary depending on make, aka brand, and model. For example, Ranger produces a series of inshore boats built for salt water. Their 2022 2660 bay model costs $113,695, while their 2022 2360 bay model costs $81,395. Other brands may produce pricier models, while some may offer something more affordable.
Features
Often, the difference between models of the same make comes down to features, from sunshades and stereos to chartplotters and autopilot. These will all impact price, and more fully-loaded models can cost significantly more than barebones counterparts.
Condition
As you might imagine, a vehicle that spends much of its life in water requires a lot of maintenance to keep it in top shape. If you’re in the market for a used boat, those that are in better condition will command higher prices.
Demand
The laws of supply and demand drive the price of goods, and boats are no exception. The popularity of a particular brand or model can drive prices up, especially on the used market. For example, the COVID-19 pandemic sparked interest in boat ownership, driving up demand for new boats and motors and in turn driving up prices as inventories dwindled.
Location
The physical location of a boat can have a big impact on price. For example, used boat buyers in the market for a seafaring vessel may pay a premium for boats that are located inland, farther away from the corrosive effects of saltwater. Sellers in sparsely populated areas may not be able to sell their boat for as much, as buyers may have to travel to consider the purchase.
Does a Boat Cost More Than a Car?
Obviously, not all boats cost more than cars. But the cost of a boat can be high because of required workmanship and materials, followed by the serious expense of maintaining it. The wear and tear of the water, particularly saltwater, is not to be underestimated, compared to what cars endure.
What Does It Cost to Store a Boat?
Many boat owners pull their boats out of the water, especially in climates where ice damage is a possibility, and store them on dry land, either indoors or outdoors. Outdoor storage will likely cost $20 to $50 per foot of the boat for the season, while indoor storage could cost $50 to $200 per boat foot. Prices vary depending on location.
Hidden Boat Costs
How much does a boat cost? You may have heard the adage that goes something like “a boat is just a hole in the water you throw money into.” What this is really saying is that the purchase price of a boat is just the beginning. There are all sorts of other costs you’ll be on the hook for as a boat owner, including insurance, mooring fees, the cost of storage in the off season, and more.
Trailer
If you want to haul your boat behind your vehicle, you’ll need a trailer, so figure that into the cost of a boat. Price varies depending on material and number of axles. Pricetags can range from $700 to $5,000.
Insurance
In most states, you don’t have to have boat insurance. But that doesn’t mean it’s not a good idea, especially if your boat is expensive. To estimate the cost of insuring a boat, consider you’ll probably pay a premium equal to about 1.5% of your boat’s value. At that rate, a $50,000 boat will cost you $750 to insure.
Mooring Fees
A mooring fee is the amount a marina or harbor will charge you to keep your boat in the water and connect to facilities such as electricity and water supplies. Cost will vary by location. In the U.S., mooring costs could be $12 to $50 per foot per year. In popular areas, mooring fees may cost hundreds of dollars per foot.
Fuel
Water produces a lot of drag, which means engines have to work hard to power boats. And that can take a lot of fuel. As a simple rule of thumb, you can calculate the number of gallons of fuel a boat will consume per hour by dividing total engine horsepower by 10 for gas engines and 0.06 for diesel engines. A 250 horsepower gas engine will consume 25 gallons of fuel running at full speed for an hour. If gas prices average around $3.00 per gallon, that hour-long joy ride will cost you about $75.
License
If you’re a private boater, most states require that you take a boater safety education course, which can end up costing as much as $65. Commercial licenses for those operating a boat with paying passengers can cost quite a bit more.
Maintenance
Boats require engine maintenance and cleaning as well as hull maintenance, which refers to the body of the boat. As with all boating costs, size and type of boat matters a lot. As a rule of thumb, boating experts estimate that maintenance costs will equal about 2% of the original purchase price of a new boat each year.
Taxes
There are no federal taxes on boat purchases, but there may be state or local taxes, including sales tax, use tax, and personal property tax. Check with your state tax office to see what you’ll owe on a boat purchase. Note, it’s important to check in both the state in which you purchase your boat and the state where you keep it.
Boat Financing Options
If you don’t have the cash to buy a boat outright, you still have some options.
Boat Loan
A boat loan is offered by banks, credit unions, and online lenders and is similar to an auto loan. When you receive a boat loan, you’ll have regular monthly payments, including interest, that you’ll make until the loan is paid back. Terms and interest rate will vary depending on factors such as credit score, income, and size of the loan.
Personal Loans
Lenders may also offer the option of personal loans. There are many uses for a personal loan, ranging from consolidating debt to starting a business to, yes, buying a boat. How you use the personal loan is up to you.As with boat loans, you’ll repay a personal loan and interest on a monthly schedule. Terms and interest rates will also be largely determined by credit score. However, you do not have to have perfect credit to take out a personal loan. Fair credit personal loans and bad credit loans are also potentially available. Consider using personal loan prequalification to see how much money a lender may be willing to offer you.
The Takeaway
Buying and maintaining a boat can be a costly endeavor. It’s critical to understand what costs factor into the purchase price of a boat and the hidden costs so you can buy a boat that fits your budget. If the water beckons and you’re prepared to embark on this project, you have options to finance it, including personal loans. To learn more, apply for a personal loan through Lantern by SoFi.
Frequently Asked Questions
What is the average cost of a boat?
Does a boat cost more than a car?
What is the cost of storing a boat?
Photo credit: iStock/NiseriN
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About the Author
Austin Kilham
Austin Kilham is a writer and journalist based in Los Angeles. He focuses on personal finance, retirement, business, and health care with an eye toward helping others understand complex topics.
