If he's selling them for $60k but they make ~$70k/year then what are you waiting for? Ask him if he'll tell you who his people are who do all those things for him (cleaning, maintenance, etc) and talk to them about continuing with you. Talk to him about how much goes into repairs, slip fees, etc - how much of that $70k gross goes into his pocket? See how much of his system you can adopt, and then adapt it to fit your needs. Managing the bookings you can do yourself from anywhere, you'll just want to have good and reliable cleaners and handyman on call. Set aside money for CapEx just like you would for a long-term rental, and then if you need to move marinas, you've got a reserve to pull from. (get it towed, don't bother with repairing/replacing engines unless you intend to use them regularly)
If the marinas they're currently moored at are fine with the short-term guests, then carry on; no reason to borrow trouble. Though, do make sure they ARE fine with it, before you buy.
Yachts are absolute money pits if you have to keep them running. They're probably not a joy even when they aren't, because you still have to keep water tanks full, get waste tanks pumped, there's specialized equipment throughout that's more expensive to fix when it breaks... but the potential returns look enormous, if you're willing to put in some extra work.
I've said I'd never own a boat (my family owned several, hence my caution) but this scenario is tempting me!
@Julie McCoy I would say I’m hesitant because of the fact it seems like a lot of moving factors, more than a LTR. Cleaning, Maintenance, posting ads daily/weekly to fill spots, bookings, book keeping, maintaining the relationships with marina, restocking, scheduling, praying the weather is warm and sunny so it rents (life shuts down around here when there is rain/tropical storms/hurricanes in the forecast). In that case to you could lose everything if there was a storm devastating enough. I’m in the very very early stages of investing, seems like a lot for me to take on at such a new start. I’m closing on my first deal right now. It is very tempting though. If you are tempted enough I can get you the link to his website/Craigslist ads.
@Joseph Gambino I read your post while on my houseboat right now sitting in bed drinking my first cup of coffee. I've had 5 houseboats over the last 15 years.
The questions you want to ask are:
1; Are these steel bottom boats? If so run, don't walk and don't look back?
2; If you haven't run away yet and they are aluminum hull boats, is he willing to finance them? Good luck with getting financing on old broken down boats.
3; Call your insurance company and get a quote for boat renter insurance.
4; Do you like to paint, write large checks, constantly look for someone to clean and make repairs?
5; Do you have someone that will look over the boats to insure the holding tanks are in good shape, the toilets are working properly, the batteries are good, the appliances are working properly, the electrical systems are safe and working properly, the top deck is in good shape? You get the idea....
6; Me and my dock mates would be all over our marina if there was a party on the boat next to me every weekend. They rent "party boats" bit these boats leave the slip and cruise around the lake.
7; Look at his tax returns. I'd bet he isn't making the $ he claims.
There's more but I have to get up and make breakfast. Basically I would look elsewhere for a business opportunity. Keep us posted on how it turns out if you do buy a fleet.
@Joseph Gambino Yes, STRs are more work than LTRs, but I do/coordinate all those things for three long-distance houses while working 60-70 hours/week. There's a big up-front time/money investment, then it becomes mostly about communication with guests and your support staff (housekeeper/handyman).
You would want to be sure the cash flow is enough that you don't have to worry about the occasional storm bad enough to impact travelers; you want to have good enough insurance that if the boat sinks in a hurricane, you're covered.
@Colleen F. has asked some very good questions to explore.
It's fine if you decide this track isn't for you - it's definitely not for everybody. But to return to your original question of is this a good investment, the basic numbers look good enough to warrant a second look/further exploration. I appreciate the offer to send me a link, but I just closed on a fourth house so I'm not in a position to get into something (else) new right now.