We’ve all lusted after them. Bobbing around the glittering harbours that hug Vancouver, providing photo ops for tourists, and, in general, evoking a sense of freedom and autonomy in all who pass by. For most of us, living aboard a houseboat seems like an impossibly exotic reality. We see them all the time and yet, no one seems to actually know who these lucky souls actually are, not to mention how they made it happen.
A few years back, CTV published an article on floating homes. It was titled, A waterfront home for under $100,000? Yes, it’s true. In it, they emphasized the fact that you can buy one of these waterfront properties for well under a million dollars; although they did point out some downsides to owning a home on water as well.
While it’s true that there are still properties available for as little as $75,000, the price tag depends largely on location. Added to that, monthly moorage and maintenance fees are steep, and the property tax (or live-aboard license), as well as higher mortgage rates aren’t for the faint of heart. What began many years ago as a unique alternative-living scenario for those who love the water has taken the trajectory of so much other real estate in BC by becoming increasingly unaffordable. Don Bruchet, president of the Floating Home Association Pacific Canada (FHAPC), was quoted in a REW article saying, “It’s getting to the point that this lifestyle is for the rich and famous.”
Still interested? I thought so.
If you’re one of the many people who, despite these warnings, are pining to throw caution to the wind and dive in (no pun intended); you need to be aware of a few things, including how to secure a mortgage.
Go out and get yourself a survey. Particularly if you are interested in an older float home, a survey is the only way of finding out its true condition and you will need to present it when you go searching for a mortgage. This will be another cost to incur, but there is no way around it.
If you plan on purchasing a float home and then moving it to another spot, it seems redundant to point out that you need to have somewhere to actually park it. Because there is no land title, you will find it extremely important to secure proper moorage facilities, which would include either a solid lease agreement or a strata arrangement.
If the houseboat you’re purchasing already has a location that you’ve fallen in love with, you may be able to continue leasing that moorage on a monthly basis (depending on the location, this can run you up to $1000/month independent of your purchase price). If you get into a situation where the “landlord” requires a security deposit, get ready to pony up thousands of dollars for moorage, parking spots, storage and whatever else they might offer.
For many, strata title ownership is the most attractive option. It it forces you to share in the cost of maintenance, but they usually offer a number of additional amenities and while more expensive, add a sense of security.
Of the few financial institutions willing to hand out mortgages on float homes, most require lawyers that work on behalf of the bank to handle the mortgage. The lender will also take into account whether you decided on strata or are paying moorage when deciding if you qualify. Float homes also may require mortgage default insurance where on a house or condo CMHC insurance is required only if you put down less than 20% on a home worth no more than $1 million.
In the end, while many recommend looking at a mortgage affordability calculator, this type of situation tends to be fairly unique from person to person. Because you don’t own land, it’s not something most lenders consider lending on and financing it is similar to a boat loan. Majority of these finances are done directly at the branch with no financing through the broker channel. Start off speaking with a former or current houseboat owner to see how they got their financing. Though I suspect once you’re sitting on your deck watching the swans sail past, it might do a fair bit to alleviate whatever energy you expended in the process.
Thank you for your posting. Very helpful. I’m wondering if you might know a lawyer who has experience working with banks on a float home mortgage moored in a non-strata Marina.
Hi Sheila, House Boat financing is now only done through the branch level. Your bank/credit union may have their own approved list of solicitors so it would be best to check with them.