Houseboat- affordable way for young person to get their own place?

[BecomeStronger]

Very small boat with a mooring on a London canal, close to Canary Wharf. Basically one room and a tiny shower room but quite nicely laid out, with an outside (decktop?) terrace for a table & 4 chairs witha canvas canopy. The mooring has a nice covered outdoor social area and showers and toilets, immaculately clean and well maintained.

The boat is for sale for £40k but can probably be got cheaper. The cost of the mooring, including electricity, wifi and cleaning and maintenance of the communal area is £750pm

What's the catch?!

The boat won't appreciate in value and you're not in control of the mooring fee? So, it's a good option if it's your only option or you can afford to buy and also save for a deposit. But, it's not something you can sell to then be a deposit for a bricks and mortar home. At least, I don't think so but I may be missing something very obvious.

Whilst it sounds ok, I would be looking into how much boats depreciate over time, compared to an appreciating asset in bricks and mortar.

Well £750pm is a pretty high rent for one room, although not OTT for central London.

It's much cheaper to buy the boat and just having a cruising licence, but that's more of a lifestyle than just living on a boat with a mooring. You have to cover a certain number of miles per year and move every 2 weeks but lots of younger people are doing this in London now.

I'd imagine the catch is the same as with buying a "park home" / caravan.

Yes, I agree completely it's not as good as buying but a flat in that area will be £900k+ and rent on such a flat c. £1600k pm?

There’s often quite big expenses that come up every so often with boats. My sister had a boat for a few years and it had to go into a dry dock for hull repairs.

If you can get a mooring I would go for that over being on a “continuous cruiser” licence. The Canal and River trust manages these and they are awful to deal with . Basically they don’t really want more “boaters” as a boat with a dog on a string and 50 pallets on its roof doesn’t look good moored in front of yet more luxury canal front flats.

I know where this is and on the surface (pun intended), not too bad a deal if you can agree longer term mooring costs, utilities and service charges re communal areas. You will also need to look into actual boat maintenance costs - how often does it need to be dry docked etc.

Quite cold in winter I would imagine. Is there a loo on the houseboat? I wouldn't want to be going outside to get to the loo in the middle of the night.
Is the mooring guaranteed?

Permanent mooring is often problematic and costly in London.

What’s the catch? I’ve got to live on a boat!

The catch is that there's only one place that does boat mortgages and they're very hard to get so the norm is to pay upfront. And most people can't afford 40k upfront! Plus boats depreciate over time and you have to pay quite a lot each year to get them taken out of the water and maintained/fixed on the underside. Plus there's always other sporadic repairs that need to be done. However if you have the money upfront it is a cheap way to buy a home! Seems a bit pointless with mooring fees that are that much though

A friend of mine lives on a houseboat.

It's freezing in the winter months unless you spend a lot on heating. Mooring fees in London are fucking expensive - they have a permanent "pitch" but it's certainly not cheap.
Boat maintenance is a pain.
It's very, very cramped. They have one double bedroom, bathroom, kitchen and bathroom space but it's tiny inside. You don't have much storage or general living space.

As an aside, £750 a month on bills is insanity.

@CurbsideProphet

Quite cold in winter I would imagine. Is there a loo on the houseboat? I wouldn't want to be going outside to get to the loo in the middle of the night. Is the mooring guaranteed?

Yes there's a chemical loo on the boat, most residents seem to use that at night but the communal facilities during the day.

Yes, the mooring is where the value in the boat is. You basically have to buy a boat to get a mooring. The boat is just a tin box, I doubt worth anything like £40k in it's own right.

There's electric radiators and a wood burner and it's only a small space so I think it could be quite cosy.

Yes, it would be a cash payment for the cost of the boat. It's a small % of what he was thinking he'd have to save to get a place of his own.

Don’t forget council tax (it will be band A) and as the previous person said utilities.
The people I know who live on boats pay close £1000-£1500 a month. But I can’t knock it, if you get a good yard it’s a great community

Utilities (electricity and wifi) and council tax included in the £750

Really, really, do look into how long the mooring is, some are long term-meaning 3 years.

£40k is over 25% of the cost of a shared ownership apartment in the area. I'd be looking to stretch to shared ownership of a 2 bed to give a semblance of future-proofing.
The houseboat sounds like great fun for a new to London renter, but for buying - I wouldn't.

There are lots of people who vlog about their house boat or canal boat life on YouTube including how to empty the chemical toilet without being sick

For cruising I think it needs re-blacking every 2-3 years so has to be taken out of the water and dry docked.

Definitely look at YouTube, people do talk about costs (I watch canal boat ones)

Its a lot. If he spends £40000 on the boat and keeps it for 5 years - that averages out at £666 a month. Not including maintanance the boat needs. Then the £750 a month mooring fees = £1416 total. Plus bills and council tax.
All of that will be money down the drain. A house/flat gains value. The boat will just loose money. The alternatives renting in London for that price (which will be nicer and have a functional loo and heating) even if a house share or moving slightly further out to get somewhere nice.

I suspect this is one of those things that seems like a really great idea, but the reality is less fun.

@BecomeStronger

Yes, it would be a cash payment for the cost of the boat. It's a small % of what he was thinking he'd have to save to get a place of his own.

But a boat will never appreciate in value. A house or flat will.

The other issue is sea sickness. I have only ever had sea sickness twice in my life, both on moored Dutch barges on the Thames, high tide but not rough weather, just constant gentle movement. The second time was at an event and nearly everyone on the boat was green about the gills, the free bar was untouched

Not everyone has sea legs.

The catch is the cost and efficacy of boat maintenance.

I don’t think it’s that great financially. 750 rents a room with a functional bathroom and adequate heating through the winter. You could keep your 40k invested.

Also, 40k as a deposit + 750 per month in mortgage payments would probably be enough for a one-bed flat in outer London or maybe shared ownership closer in.