Buy and hold houseboats?

Real Estate Agent · Portland, OR · Member since 2013 · 412 posts · 219 votes

Hi all,

I'm curious if anyone has any experience buying and renting out houseboats? I know there are slip fees (if the slip isn't included in the purchase price) and I'd be shocked if there weren't some sort of HOA fee to pay for docks, walkways, garages, and depending on the marina utilities.

On the positive side, you get waterfront property and a unique draw for tenants. There is a fair amount of waterfront in Portland and a lot of sweet architecture on that waterfront. I don't see many of them come up for rent so don't have as much information to pull from.

Does anyone here hold and rent houseboats?

Thanks,

Mathew

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Steve Chaisson

Nashville, TN · Member since 2013 · 86 posts · 40 votes

12y

@Bill Gulley - I know one of them is a commercial broker. She remarried an architect who drowned in a boating accident falling off of their boat. I think she's still single if you want to give it a shot. :)

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Steve Chaisson
Nashville, TN · Member since 2013 · 86 posts · 40 votes
12y
My buddy Rusty, who is a commercial real estate broker, smoked a deal on a houseboat at an auction. He bought a boat for 100k that is worth 300k. He knows boats very well though - he is a tournament fisherman and has his own tv show. He was able to finance the entire purchase with a local bank and leases the boat for events at $300-$500 per night depending upon the season. If you know boats well you can make a lot of money, but like anything it requires a certain expertise that takes experience to develop.
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Bill Gulley
Investor, Entrepreneur, Educator · Springfield, MO · Member since 2009 · 21k+ posts · 12k+ votes
12y
Steve, your friend might know boats, but he don't know finance. A 300 K lease is about 50% 150K leased in 6 months on the average = 150,000/180=833 a day plus fuel. He should be at about a grand a night with price breaks down for multiple nights, like 800 for 3 nights, maybe 750 a night for a week. No way would I let a bunch of drunken fishermen with their rented bow babes on a 300+K boat! Either he has a big cleaning deposit or he works cheap, a third of that $300 could be cleaning up. JIMO :)
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Steve Chaisson
Nashville, TN · Member since 2013 · 86 posts · 40 votes
12y
@Bill Gulley - Rusty knows quite a bit. His ex-wives are all millionaires lol.

The boat sits on the slip. It's for parties. He doesn't pay for fuel. Ten people can rent it and sleep there for the night. He doesn't allow them to take it out.
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Bill Gulley
Investor, Entrepreneur, Educator · Springfield, MO · Member since 2009 · 21k+ posts · 12k+ votes
12y
Oh, never mind, BTW, you got the numbers for those ex's? LOL :)
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Steve Chaisson
Nashville, TN · Member since 2013 · 86 posts · 40 votes
12y
@Bill Gulley - I know one of them is a commercial broker. She remarried an architect who drowned in a boating accident falling off of their boat. I think she's still single if you want to give it a shot. :)
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Bill Gulley
Investor, Entrepreneur, Educator · Springfield, MO · Member since 2009 · 21k+ posts · 12k+ votes
12y
Originally posted by @Steve Chaisson:
@Bill Gulley - I know one of them is a commercial broker. She remarried an architect who drowned in a boating accident falling off of their boat. I think she's still single if you want to give it a shot. :)

LOL, sounds like the oldest insurance scam in the book, he "fell off" the boat at sea! Right, after twelve drinks and passed out, his foot got tangled up in the anchor line and in the rough she fell engaging the anchor release. Evidently the line wasn't secured at the end of the line! I better pass on this one, but sounds like we'd have things in common, professionally, not sure I'd leave the mooring with her ....:))
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Mathew Wray
OP
Real Estate Agent · Portland, OR · Member since 2013 · 412 posts · 219 votes
12y
@Corey Davis

Alas, my answer was no for the buy and hold houseboats. I still love the idea, would love to own a houseboat for myself, and maybe when I've got more disposable income and can afford to invest "for the fun of it" I'll go for it. But for now, when my funds are limited I'd rather put the money back into my business or use it to buy a proven, land-based property. That being said, if I came across the right property at the price the "romance" of it might make me dip into my reserves and see if I could make a go at it :)

I know you've spent some time up here digging around the market. Did you find any houseboats that would work for you? I think a lot of people have trouble realizing that these are waaaaaay more house than boat. Whether that translates into a rent premium is what started this whole forum thread and still up for debate.

Mathew
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Ron Jones
Real Estate Investor · Houston, TX · Member since 2013 · 31 posts · 16 votes
12y
You guys quit dreaming and get back to reality. I have owned big boats. 40 ft plus. I have a friend who has a houseboat he rents out. There is a big difference in the business model for renting a boat by the week/weekend and buying boats for people to live on. Weekend rental is doable but there is nothing in that model that applies to this forum. I mean we could talk about opening car washes here if you would like:) Renting houseboats on big lakes is big business. When I was in the airline piloting business we had lots of friends party with us here.

lakepowell.com
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Corey Davis
Los Angeles, CA · Member since 2013 · 169 posts · 27 votes
12y
Originally posted by @Mathew Wray:
@Corey Davis
I know you've spent some time up here digging around the market. Did you find any houseboats that would work for you? I think a lot of people have trouble realizing that these are waaaaaay more house than boat. Whether that translates into a rent premium is what started this whole forum thread and still up for debate.

Yep. I was up there a week ago and will be putting some offers on a few houseboats pending an inspection. Buying these things is a lot like buying a collectible car. They are all very different, replacement parts can be a headache, rust is an issue, and values swing wildly up and down depending on the type of owner you're doing business with.

From a buy and hold perspective, houseboats usually don't make a lot of sense, although there are some exceptions to the rule, just not in Portland. The rental value is also iffy, when you consider the amount of maintenance, and in Portland the houseboat communities aren't where the higher rents are.

There IS, on the other hand, a market that houseboats work in. A couple of former partners and I have just started a new venture using a nightly/weekly/monthly rental formula. The numbers add up quite well when marketed and managed properly.

Ask me in four months how well it's working, I will be happy to share my experience.

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Account Closed
Manasquan, NJ · Member since 2014 · 88 posts · 23 votes
12y
This BP is awesome! House Boats really a post about house boats!

I just ran across a deal in NJ just yesterday. Guy has this awesome houseboat. It is a pontoon/catamaran like boat that has a 1 BR 1BA prefab like home built on it. 12' wide 40' long. Insulated and heated. Comes with an out board to putter along but the truth is I would keep it docked/moored and get a small B-Whaler to use for water sports (not sure if i can mention website of company that builds and sells them). It is like my cabins in PA. It even has a loft! Any way the guy owns the marina and adjacent shop and this boat is in pristine condition (BTW) the state sends around a pump out boat for FREE to remove waste the boat generates so it is not dumped in the BAY. (only in NJ rich get there pooped removed for free from there mega yachts and schlubs like I pay for it in my R/E taxes). Any way 50 K for the boat and all the high end furnishings. I can keep it there for free (except I pay electricity) for one year and then I am guaranteed to keep it there for $1500.00 a year for 4 additional years. Rents for 1 Br apts overlooking the water go for $6000.00 a month seasonally (4 months) then $1500.00 a month the rest of the time and round in this area not sure what ON the water is worth but I truly believe there is a market for this. He is also giving me 2 parking spaces, Free H20 hook up, a place to store and use a BBQ even though stove and oven inside unit with peninsula island, Vaulted 12 foot high living room with pull out additional queen size couch and flat screen tv, free wifi and satellite TV, Full size fridge and Microwave even alarge MBR closet that holds washer and dryer stackable(but the owner will let me use a new washer and dryer he has on land for free! in an outbuilding). This is like a bucket list thing. My significant other thought I was crazy but when he sat in the overstuffed high end recliner I saw his hair stand up as the goose bumps got larger and larger. We have some rentals and a mixed use property with our construction Biz in it. OKAY my question is does putting down $5000.00 then financing the rest $45,000.00 at 10% make sense? Would you do this deal? Do I live on it and rent my primary residence with positive cash flow of $1200.00 after paying everything to include setting aside a very substantial emergency fund? Again am I being emotional or am I just enjoying the fruits of my hard work?
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