Moor For Your Money: How to buy a houseboat

Donall Murphy, Partner in the Russell-Cooke Solicitors, property law and conveyancing team. Newsletter Block Logo
Multiple Authors
4 min Read
Donall Murphy, Russell-Cooke

With property prices ever-increasing in the capital and supply dwindling, house buyers may consider purchasing a houseboat as a cheaper and more individualistic alternative to living on dry land. Before taking the plunge, however, would-be houseboat buyers should be mindful that purchasing a houseboat is notably different to purchasing a regular house.

Houseboats come in all shapes and sizes: they may be purpose built, or converted from a vessel such as barge, dutch barge, sailing or motorised vessel. Crucially, in order to be classified as a houseboat the vessel must have no means of self propulsion. A permanent mooring is essential, as without any means of propulsion, to move a houseboat will require the assistance of tug to tow, or expensive crane and road haulage (assuming that the water is accessible by road).

A houseboat may be sold through a traditional estate agent in addition to a marine broker, and demand for moorings exceeds supply. They may be found on the River Thames and in high class marinas in the city such as Chelsea Boatyard. Butlers Wharf and upstream at Taggs Island near Hampton Court are also home to many as well as in canals, basins and other stretches along the River Thames. The mooring can be fixed on a bank, pier, pontoon or jetty – or maybe a swing mooring mid stream accessible only with the aid of a boat or tender.

Houseboats are classed as Chattels and therefore will not create an interest in land, even if they are connected to the land by service media pipes and cables. A Mooring Licence is required from the owner of the bank, boat yard or marina. These documents can be extremely complex in a high-class marina, running into numerous pages and very often similar in content to a residential lease – particularly where there are shared facilities with residential leasehold owners of apartments or houses within the same complex. For smaller marinas or boatyards the mooring licence can be simple and often based upon a document issued by the Canal & River Trust. In addition, a licence will be required from the local Water Authority and/or the Port of London Authority to moor. The fees will vary according to the size of the vessel.

Just like a house purchase, a buyer will need to consider the locality and area in which they wish to live, and should visit the mooring at different times of the day and week, especially in tidal waters. At low tide you may find that the pleasant river or estuary view has receded with the water, leaving rather unattractive mud or river beds and sunken wreckage. It might also be smelly.

Very often there is an obligation to obtain the licensors or boatyards consent to the sale or assignment of the houseboat and mooring licence; a fee may be imposed, which I have seen as high as 5 per cent of the houseboat value.

A boat brokerage has suggested that there is no need to engage a lawyer to purchase a houseboat. I have dealt with transactions which have ranged in value between a few hundred thousand pounds to £1.3m, and in my view expenditure of this nature requires the same degree of due diligence, as undertaken in any residential purchase. This will include undertaking conveyancing searches and enquiries, reviewing the mooring arrangements, agreement for sale and on completion the Bill of Sale which is the legal document transferring ownership.

In my experience, houseboat purchasers often acquire a houseboat as either a new, permanent residence or a second home, and the transaction will be linked with the sale of an existing home which will have to be co-ordinated. Therefore it is generally convenient to follow similar processes as any linked property sale and purchase.

Most purchasers tend to be cash buyers as it is very difficult to raise finance on a houseboat. There are a few providers, who typically offer loans of 75% of the value over 10 years with interest rates substantially higher than mortgage rates.

A marine survey should be undertaken indeed some insurers will insist upon a full prepurchase survey before providing cover. You should ensure, where possible, that the boat is lifted during inspection and the hull tested for strength.

There is a legal requirement for all boats to have a Boat Safety Certificate, similar to a car MOT. Although these are only required every four years, it is wise to obtain several quotations for inspections as the fees can vary.

In terms of insurance for static houseboats, liability cover is required for both land based liability and marine liability. Vessel owners must ensure that in addition to insuring the vessel and its contents they have a marine liability in case the vessel breaks free of its moorings and causes damage, injury or even sinks. These nightmare, but not improbable, scenarios would require the houseboat to be salvaged or recovered in order to prevent a danger to other craft.

Generally speaking all fixed houseboats will be liable to pay Band A Council tax, and a houseboat will not attract VAT or Stamp Duty Land Tax. However, SDLT may be payable on the mooring agreement if exclusive possession of a fixed berth is granted. Houseboat residents are entitled to register for voting and are also liable to be called for jury service. In respect of state benefits and grants, these are available to boat dwellers on the same basis as any other citizen.

Indeed, as a houseboat owner you would join famous owner’s including singer and musician Nick Cave, Pink Floyd member Dave Gilmore, Imogen Stubbs and Bear Grylls – to name just a few.

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Briefings Property law and conveyancing Property law and conveyancing How to buy a houseboat