Alternative accomodation

[unpc]

This is probably a stupid plan but here goes...

I spend the working week away from home in an office near the Broads in Norwich. I spend a small fortune on hotel accommodation but with spring approaching I had an idea that buying a used Broads cruiser to live on throughout the summer might make sense. I might even be able to rent it out during the weekends too. So the question is, does anyone have any idea what the practical, financial, tax and re-selling considerations of this hair brained scheme might be? Would it be great investment or a total money pit? I think I know the answer already but floating accommodation has a certain appeal.

[Eric Mc]

In theory,. the hiring out of a narrow boat would be a business proposition - presumably in the same way that renting out a holiday cottage or holiday farmhouse is.

Renting out of such buildings is taxed under business taxation rules rather than buy to let rules - so there are some advantages over simple rentals.

Firstly, capital allowances can be claimed on fixrures and fittings

Secondly, losses generated can be offset against other income in the same tax year. If you already pay tax under PAYE or some other self employed activity, then trading losses such as this can be very useful in obtaining tax refunds.
(Losses from normal rental properties cannot be relieved in this way).

HOWEVER, HMRC are suspicious of business activities which appear to only ever make losses and they may try and argue that such an enterprise is really a hobby rather than a business. If they succeed, that would mean that any losses incurred would be of no use to you as they would not be trading losses.

[Simpo Two]

There are good things:

'Free' accommodation
An asset that shouldn't depreciate if looked after
Cruising as a bonus

There are bad things:

Mooring/marina fees - charged per foot per annum
Maintenance - batteries, engine, light DIY as required
Crane/hoist fees for winter layup (recommended every two years for antifoul)
Broads Authority licence - c.£200 depending on length

Hiring out for money to third parties would probably bring in a world of insurance issues and probably not worth the aggro. You can get into all sorts of problems with boats, especially with rookies at the helm. But lending to mates might be a way of building up favours.

If you fancy owning and actively using a boat for its own sake, then go for it. But it's not just a 'shed' you can lock up and forget about; it's a commitment. It's a bit like buying a second, very small, house.

[unpc]

Thanks Eric,

I'm currently trading though a limited company so my initial thoughts were to do this under another company and rent it back to myself Monday-Friday and anyone else at weekends. I'm leaning more towards a classic boat as the depreciation might be a lot less but the maintenance costs higher.

[Eric Mc]

If you want to make use of losses, the LAST thing you want to do is put the trading activity through a limited company. Speak to your accountant.

[Simpo Two]

unpc said:

I'm leaning more towards a classic boat as the depreciation might be a lot less but the maintenance costs higher.

By classic you probably mean wooden 'Dunkirk' style.

Three kinds of boat:

Fibreglass cruiser
Steel narrowboat
Wooden cruiser

As it seems you're not really interested in boats per se, avoid wood at all costs.

[unpc]

Thanks gents, although I'd love a wooden boat I think the maintenance might be too much. I'll have a word with my accountant before I start looking deeply into this but do you know how difficult these things are to re-sell? I think once my contact here is over I might want to get rid. Actually a long term rental would probably make more sense.

[Simpo Two]

unpc said:

how difficult these things are to re-sell? I think once my contact here is over I might want to get rid.

Most people use brokers; I think for convenience as often they don't live close by. So you just give a broker the keys, he markets the boat for you, handles the money and legal stuff and sends you the proceeds minus his 7-10%.

Just like cars, the better the condition and the more realistic the price the faster it will sell.

A quick Google gives: www.norfolkboatsales.co.uk/boats/boat_list.asp

[unpc]

Thanks Simpo, there's few on that site that look interesting. I shall have a word with my accountant and the CFO (Mrs UNPC) before this goes any further. I'm wondering if this will make me some kind of floating gypsy but this could be far more interesting than a travellodge.

[Simpo Two]

unpc said:

this could be far more interesting than a travellodge.

I have a small cruiser about 75 mins up the A14. It is remarkable; no sooner have you left the marina and gone 50 yards down river, you're in a different world.

A weekday lunchtime. All my neighbours are earning £££ in London, and I don't care

[unpc]

That's what I'm talking about. I don't need a gin palace (although I'd like one) but something big enough to sleep on during the week and if I checked my bike on the back I could relocate the thing whenever I want. I doubt I'll still be on it during the winter months.

[Eric Mc]

Have you thought about a motorhome?

[Simpo Two]

unpc said:

That's what I'm talking about. I don't need a gin palace (although I'd like one) but something big enough to sleep on during the week and if I checked my bike on the back I could relocate the thing whenever I want. I doubt I'll still be on it during the winter months.

Best way to store a bike on board a boat this size (23 feet) is to use/fit davits at the back. It would be exposed to the elements though. Having a bike in the cockpit wouldn't work for cruising; you'd constantly be falling over it.

All boats have to be moored somewhere (unless you're going to trailer it everywhere). Sadly you can't just leave it where you like for free, you'll need to pay for moorings. In the Fens a 23 footer is £550-£1100 depending on the facilities provided; can't speak for the Broads. Whilst cruising you can generally stop for the night anywhere it's safe and doesn't say 'private'. There will also be official temporary morrings where you can stay overnight or for a few days for free - google 'Broads Authority'.

Winter needs some preparation or you'll end up with damp soft furnishings and possibly a sunken boat (!). Boat engines don't use radiators like cars, they take cooling water from the river via a sea cock. If you leave the engine and seacock full of water and it freezes, things can crack, and if the sea-cock cracks then when the thaw comes it's bye-bye boat. So boats are 'winterised' at the end of the season whereby the system is filled with antifreeze instead.

There's no reason why you can't live on a boat year round, but you need to get electricity from somewhere. Normally this is done via batteries which are charged by the engine (but that doesn't work when the engine is laid up) - another option is a marina with 'shore power' - ie a 13A mains lead you just plug in Heating and cooking is by Calor Gas, and you can get Propex/Eberspacher/Truma hot air/water heaters if you want to get really cosy.

HTH

Edited by Simpo Two on Wednesday 9th March 15:47

[unpc]

Eric Mc said:

Have you thought about a motorhome?

I have but they just don't do it for me.

[Flintstone]

unpc said:

Eric Mc said:

Have you thought about a motorhome?

I have but they just don't do it for me.

They don't float very well either

I've looked into this too as I live in Herts but work out of Hants with some very early starts. I thought I could wander down the evening before a work day thereby avoiding the lottery of the M25. That and sitting on the deck in the evening with a glass of something while watching the swans glide by really appeals to me.

Broads crusiers seem to be (surprisingly) expensive when to my untrained eye they don't appear to be a lot different to other types of cabin cruiser. They don't seem to sell very quickly either, I've followed ads that hung around for months, over a year in some cases. Of course it's a seasonal thing, limited market and the price might have been wrong.

In the end I just couldn't justify it. Mooring, insurance, cost of purchase all added up to way more than paying for hotel rooms. Might have been slightly different if the family and I then used it for breaks but they've no interest and frankly the location (within shout of Farnborough) isn't the sort of place you'd go for a holiday. Maybe different if it were the Broads even with the seasonal influx of chavs.

Edit: Now this is pretty...

Classic

Edited by Flintstone on Thursday 10th March 11:47

[Simpo Two]

Flintstone said:

Broads crusiers seem to be (surprisingly) expensive when to my untrained eye they don't appear to be a lot different to other types of cabin cruiser.

I was astonished to see that fairly 'ordinary' boats can go for £100K+. However these are new or very recent boats, and there's a rapid depreciation curve that settles down almost to level, or in fact can go back up. You can get a modest but smart decent fibreglass boat from the 70s (like mine) for well under £10K, and you don't have to buy the boat on the waterway you intend - they can be trailered/transported from one system to another.

So if you look after it you will get your money back (less broker's fees if you sell that way). However as stated there are running costs of at least £1,000 a year, more for a longer boat. But then, your car is losing more than that just sitting there

[Flintstone]

My master plan was a broads cruiser (how do people live on narrow boats without going postal?) which I'd have taken by road to somewhere near Farnborough. Not many places around there though and once it's on a canal you're stuck there with not a great deal of access to other waterways.

I still like the idea of having something I can chug off upriver in, moor somewhere quiet and just relax.


PS. Cassette toilets are just wrong.

[unpc]

You're quite right about the price of broads cruisers so I started toying with the idea of something I could use elsewhere for when this contract finishes. If found this http://www.norfolkboatsales.co.uk/boats/boat_detai... which is probably totally unsuitable for sleeping on but it will likely be only 3 nights a week. It's got a 454 V8 in it so it's not all bad. I'm liking that a lot.

[Simpo Two]

7.7 litres and 330hp... you may want to investigate how much petrol costs at marinas!

[unpc]

Simpo Two said:

7.7 litres and 330hp... you may want to investigate how much petrol costs at marinas!

Yes I had thought about that but realistically it would hardly ever get used. My plan mostly involves leaving the thing parked up somewhere I can just use it for sleeping on the odd night. I have seen some of these things adapted for LPG but others tell me that gas on boats is a bad idea for obvious reasons.