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June 23, 2016
By now we’ve all heard about, if not in some way experienced, the craziness of the Seattle housing market. Record high prices for single-family homes, coupled with extremely low inventory and a large increase in high-paying technology jobs have made all-cash offers and bidding wars the norm for people looking to purchase a home or condo in or around Seattle.
Despite all the craziness, there is a niche within the housing market that still exists for those of us who can’t afford the $500,000 average price tag for a home in Seattle. The only catch: you’ve got to be willing to wave goodbye to dry land, and wave hello to an aquatic lifestyle.
Houseboats and floating homes have been a mainstay of Lake Union’s waterfront communities for over 100 years. While the city itself has consistently continued to grow, these communities have ebbed and flowed in number over the years. Recently, with the adoption of a new shoreline master plan and new rules allowing houseboats and floating homes to be listed on the NW Multiple Listing Service, there has been a major spike in interest for these unique dwellings and for good reason.
Although floating homes in Seattle have sold for as much as $3 million, houseboat prices are often much more reasonable.
‘Owning the mud’
Floating homes differ from houseboats in a few distinct ways, which helps explain some of the price discrepancies. Owners of floating homes usually “own the mud,” meaning they physically own the land beneath the water, while houseboat owners typically rent the moorage space in which their houses are parked.
Floating homes are also plugged into the city sewer system and have city power. Houseboats on the other hand are connected to dockside shore power and have black water tanks that need to be pumped out regularly.
Despite these differences, both offer their owners the same opportunity for an unparalleled living experience. Imagine coming home from work and sitting on your rooftop deck, looking out over Lake Union as sailboats zig-zag across the water and seaplanes land and take off in the distance. Many of the marinas, especially the ones along Eastlake, have direct views of the Space Needle and the city skyline. Paddle boarding, kayaking and fishing are right outside your back door.
While the summer days of life on the water tend to be the more memorable ones, some of my favorite memories are of winter storms. Something about the wind whistling through the masts of the sailboats parked around my houseboat, coupled with the sound of rain drumming on the roof and the slight sighing sound the dock lines make elicit a feeling of deep satisfaction. I’ve fallen asleep many a time curled up with a good book on my couch, the boat doing its best to rock me gently to sleep.
The best part about this lifestyle for me is the simple fact that I am able to afford living in the heart of Seattle. I purchased my houseboat two years ago for around $250,000. It’s about 700 square feet, making it almost as big as many of the apartments my peers are still renting today. It was a new construction, built by Bill Haggard, a local craftsman who has specialized in building houseboats for years.
My marina, Canal Marina, is located “on the cut” or the channel between Lake Union and Ballard. This location is perfect for me. I am five minutes from Fremont or Ballard, and roughly 10 minutes from the heart of downtown. There are grocery stores right up the hill in Queen Anne, and I am a short walk away from some great bars and restaurants.
How to buy
Purchasing a houseboat isn’t nearly as difficult as you might think. Although there are some slightly intimidating nuances that can be daunting for first time buyers, overall the experience isn’t too different from buying on land. This is especially true if you have a Realtor that knows what they are doing. In my case, I used Kevin and Linda Bagley of Special Agents Houseboats.
Kevin and Linda are the premier agents for this niche. They actually live on a 60-foot paddle wheeler houseboat, and their office is suspended over the water on Lake Union. Together they have over two decades of experience. They live and breathe the aquatic lifestyle and they made the process so easy for me. Their connections within the community, their wealth of knowledge and friendly laid back style was truly something I hadn’t seen before from any real estate agent.
Before purchasing a houseboat you go through an inspection process, not much different from what you would have done for a home on land. The main difference is the “haul out process.” The boat is essentially lifted out of the water by a huge crane called a travel lift. While it is out of the water, the marine surveyor inspects the hull for any damage or soft spots. The process will also ensure that the boat’s safety gear, including bilge pumps are working properly. Just about everything else during the survey is the same as it would be on land.
You can get financing for purchasing a houseboat, however there is only one lender that will do it, Sound Community Bank. Their rates are very reasonable, but buyers should be aware that in addition to the 20 percent down payment, you will also need to have cash for the sales tax, which is about 10 percent of the overall price.
Despite the relatively large cash outlay that is initially required, when compared to the cost of purchasing a single-family home on land, this can often be far more affordable.
If you were to tell someone that you were going to buy a boat as an investment, you’d probably be laughed at, but in the case of houseboats in Seattle, their values have actually consistently tracked alongside home values on land. This makes purchasing them that much more enticing. Over the last year I have seen many awesome houseboats sell for between $169,000 to around $400,000. This price range is definitely in the ballpark for a lot people, and although competition amongst buyers is increasing, there are certainly some affordable opportunities to be found on the lake.
So, if you’ve been thinking about buying a house in Seattle, but you’ve had trouble finding a home you love, try putting on some boat shoes and hitting the docks.
Brendon Meyer is a local entrepreneur, Realtor and business consultant for Zillow Group. The Washington native is a board director of the Lake Union Liveaboard Association. His houseboat at Canal Marina is named “Nick of Time.”