How pushing the boat out can save cash

By Thomas Edgington
BBC News

Tim and Lucy's houseboat was a fraction of the cost of a house or flat

With the housing market looking increasingly gloomy and uncertain, some would-be-buyers have been tempted to swap bricks and mortar for ducks and water by choosing to live on a houseboat.

But despite dire associations with cramped space and primitive living conditions on board, it is possible to equip yourself with all of today's modern gadgetry and with ample room to spare.

Tim, 25, a graphic operator and Lucy, 26, an analyst for an education consultancy, have been living in their houseboat - the Workman - in Barking, Essex, for almost a year.

Inside, their home boasts a spacious living room, bedroom, kitchen, bathroom and storeroom. Plus it is equipped with broadband internet, home phone, and mainland electricity and water.

Within minutes you forget you are not actually on dry land.

"It's only when a speedboat passes or when it's particularly windy do you remember you're on a boat," Lucy says.

The Workman is an impressive 86ft x 15ft, and at a recent party the couple were "easily able to accommodate 40 or so guests, as well as a full DJ set in the living room".

Attractive price tag

And the couple - who commute into London each day - are full of praise for the community spirit in the area, its security and safety.

"It's a brilliant area. Last year there was a Christmas party and there are also regular residents' meetings," says Tim.

The houseboat comes equipped with plenty of mod-cons

His lifelong interest in boats also helped when he decided to take the plunge after spotting an advert for a houseboat.

At £80,000, the Workman comes at only a fraction of the cost of nearby properties.

According to the Halifax the average price of a UK home stands at £177,351 - down 8.8% on last year - and with mortgage lending falling and household finances squeezed many potential buyers are putting purchases for as long as possible.

Conversely as house prices have fallen, the cost of renting has increased, Capital Economics forecasting a 10-11% rise in 2008/09.

So is a houseboat a realistic alternative?

If you consider that houseboats can be bought for as low as £20,000, prices are significantly cheaper.

Steve Sutton, Business Sales Director of The Houseboat Centre, based in Kent, estimates that £100,000 would provide an average family with a fully fitted houseboat and comfortable living.

Hidden extras

But there are other costs which need to be considered.

The major obstacle is obtaining a mooring, which can be difficult to get and expensive, depending on the area.

We are seeing demand up and down the country Steve Sutton, The Houseboat Centre

However, one way around the problem is to buy an existing houseboat complete with residential mooring.

For Tim and Lucy, the mooring fees, plus other living expenses only amount to £500 per month. However they do not currently have central heating, they intend to install that before winter.

The Workman was converted to its current guise in the 1990s after starting life as a cargo vessel and does have residential mooring.

As such it means the boat can be registered as an address as well as being connected to mainland water, phone line and electricity supplies, just like any other domestic property. It also means Tim and Lucy must pay council tax.

The Residential Boat Owners' Association (RBOA) estimates that there are now 15,000 people in Britain living on boats.

Housing solution?

And these, Mr Sutton explains, generally fall into three categories: young couples hoping to escape the rental market but unable to afford a property, middle-aged couples wanting to release some equity and live mortgage-free and older people looking to downsize.

Living on a houseboat does not mean cramped conditions

Mr Sutton also believes that waterways could be used to tap into Britain's chronic shortage of affordable housing.

"Britain is surrounded by water and most rivers are not being used to their potential," he says.

"We are seeing demand up and down the country. Yet moorings in some areas are not available."

But while strong demand, boosted by affordability, means that houseboats are likely to gain in value over time, Mr Sutton does have a word or two of warning.

To make the most of your investment make sure you keep it ship-shape and well maintained, and also expect any price increase to be slow and steady.