The difficult transition from real estate to liveaboard

[2savage]

I'm curious how others feel about this. I'm concerned that when its time to return to shore I can actually afford a roof over my head once the boat is sold. However, I'm equally concerned and focused on divesting myself of 90% of possessions and all real estate so I can be totally mobile and not waste many thousands on storing furniture that I might not like in 15 years.

I'm hedging my bets by selling my primary residence of the past 29 years (and its contents) but keeping a small Condo I also own and renting it to cover its costs and provide a little extra income.

What have others done? What are you worried most about?

 

[ksanders]

I have been a "stay aboard" since 2018. What that means is that I have still had a house but chose to stay on my boat.

That phase of life is ending with my wife and I finally finishing up our married life.

Part of the reason I allowed this to drag on so long is that I was afraid. I have always had the fall back of real estate as a major asset and being without that is frankly scary.

I am almost 60 and figure that I have maybe 15 years of good health in which to explore by boat. After that my body is probably going to be getting long in the tooth to do things like crawl around the bilges, and medical issues might force me to be less nomadic.

What to do? In 15 years my boat that is worth in the range of a decent condo now will be worth some percentage of that, I'm guess ing 50-60%. While real estate will have risen 30-100% above what it is today.

If your boat represents a huge chunk of your net worth one might find themselves trapped living on a boat for life, at the mercy of liveaboard rules and quotas, making a prime location difficult or impossible to obtain.

A solution i am considering seriously is to take my cash and within the next year or two buy a condo or home somewhere and rent it out. My thoughts are to choose somewhere touristy enough to rent it out as a vacation rental Vs having long term tenants. That way I am not stuck in a declining neighborhood somewhere with a funky condo.

Where??? Well I'm starting my retirement cruising adventure as soon as the weather breaks for spring. That adventure will without a doubt expose me to places I never considered. Even countries that I never considered.

Another option is to keep it reasonably invested, but that has risk of course. Invest too conservativly and you do not keep up with inflation, and too aggressively and you might be in a market downturn right when you need the cash. At least with real estate even if it decreases in value you can live there.

Now... If one does not have that ability.... If their main asset is the money they have tied up in a boat with no option for simultaneous investment in real property then one must plan extremely carefully.

My opinion is that someone contemplating an active cruising lifestyle needs an exit plan at least for the cruising part. I see no problem growing old living on a boat but you need to at least plan on where to park it to live life post cruising.

That might be a condo slip with liveaboard rights. That might be buying a piece of property along a waterway where you could park your boat. That might mean paying rent in a slip full time that you are only using part of the year to get liveaboard rights. That might also mean being willing to finish out your years in a location with lax liveaboard rules and or no wait lists.

The big thing is to plan it out so that you do not find yourself 75 years old, in declining health and zero options.

 

[Miz Trom]

I'm curious how others feel about this. I'm concerned that when its time to return to shore I can actually afford a roof over my head once the boat is sold...

but keeping a small Condo I also own and renting it to cover its costs and provide a little extra income.

What have others done? What are you worried most about?

Hi Alan:

It all depends upon what you are comfortable with, and how well you can anticipate your future needs.

For example, we lived aboard and cruised on our boat for six months in 2019. When the pandemic hit in 2019, we were within days of starting the Loop. Decided to put the boat in storage and remain at home for the duration.

Now we find ourselves taking care of my Mom, and very glad to have a dirt home. We are the only ones in my family "flexible enough" to care for her.

Even though we are both retired, we have found that maintaining a dirt home, a rental house, and a boat to be a bit much on top of taking care of Mom. So we are selling our boat.

To answer your question, what I worry most about is regretting selling our beautiful boat once she is gone.

And keeping Mom comfortable.

Cheers,
Mrs. Trombley

 

[tiltrider1]

I would never sell my dirt to fund my boating existence. I have no problem converting a primary residence into an apartment building or a REIT. At least this would give me options in the future.

 

[Porgy]

When we decided to be full time cruisers we looked at it as not just a new chapter in our lives but, a whole new book. We got rid of everything except for a few keepsakes. We dove right in, no handwringing and haven’t regretted it. We sort of treat moving back to land as “we’ll cross that bridge when we get to it.” In reality we have enough in assets to acquire a home later when/if we need to. Because we might want to buy a house someday doesn’t mean we have to invest in real estate. The idea of having some sense of security remaining anchored to land by retaining a home doesn’t register. For us, one bad rental tenant experience would sour us on the landlord thing, even with a management company overseeing the property.

The home of our waning years would be modest but, neither of us have any desire for anything large. A one bedroom condo would work, other than having to endure a resident who made a retirement career of playing Mayor of Condoville. But for now, and at this for over nine years and in our 60-70’s, we don’t stress about it.

 

[slowgoesit]

We just took the leap recently, arriving to our boat (finally) 7 months after we purchased her. Sold all but one property. That last one has our shop, with attached 1 bedroom, 1 bathroom house on 1.25 acres. It is our dirt home we can return to periodically, and allows us to keep the remaining "stuff" that we still haven't managed to part with. It also gives us homeowner's insurance that covers that boat related stuff well above the limits that our boat insurance cover covers. We do not rent it, although we do have a friend who checks up on it regularly if we are not there. As a hedge against inflation, it is good. As a protection against sticker shock were we to buy another home somewhere else? . . . that remains to be seen.

We did not fund the purchase of our boat with the sale of our primary home. We are not rich, but we are "comfortable". That has different meanings for different people, but we have enough to get along. Hope you figure out a path that works well for you. We are loving being aboard now after so long dreaming about it!

 

[BandB]

I'm curious how others feel about this. I'm concerned that when its time to return to shore I can actually afford a roof over my head once the boat is sold. However, I'm equally concerned and focused on divesting myself of 90% of possessions and all real estate so I can be totally mobile and not waste many thousands on storing furniture that I might not like in 15 years.

I'm hedging my bets by selling my primary residence of the past 29 years (and its contents) but keeping a small Condo I also own and renting it to cover its costs and provide a little extra income.

What have others done? What are you worried most about?

Wifey B: Hard to answer you when you say nothing about your family, your age, your boating experience?

 

[2savage]

Wifey B: Hard to answer you when you say nothing about your family, your age, your boating experience?

Well, the question was "What have others done? What are you worried most about?". I'm not looking for people to analyze my life and comment on my choices.

That said, 60 years boating, thousands of offshore miles, no family to worry about. I'm 66. Oh, and my wife isn't family; she's a piece of me.

 

[BandB]

Well, the question was "What have others done? What are you worried most about?". I'm not looking for people to analyze my life and comment on my choices.

That said, 60 years boating, thousands of offshore miles, no family to worry about. I'm 66. Oh, and my wife isn't family; she's a piece of me.

Wifey B: You are correct but important to know if other's activities are relevant to you. If you and your wife have thousands of offshore miles together and no family to worry about, then that does greatly improve your odds.

We couldn't and wouldn't as we've somehow crazily developed a large extended family and could never be without our land home to return to and enjoy them. We're typically 6 weeks on board, then three at home, then six back cruising and we repeat over and over and over.

When it often doesn't work out is when one spouse is far less enthusiastic about the idea than the other. It also doesn't work for some who just lack the boating experience. Then grandkids are a big killer to full time cruising. Couples find they miss them too much.

Those like you and your wife are the ones who do make it work out. I'm betting as others post who have done it successfully you'll find they're very similar to you.

As to us, we cruised and responded to hubby's famous theory of pain, a business theory he has and also for things like this. At 4 weeks we were always ready for more. As we neared 6 weeks, we looked forward to the trip home. After three weeks at home we looked forward to returning to the boat. A couple of times we've stretched to 8 weeks but then always been anxious for home and stayed there longer. This summer, due to travel restrictions, we haven't been home since we flew back to Italy on June 29 and we fly home on October 16. We've had an incredible time but we really miss those at home. We will stay near the rest of the year with short trips. We webcam with them and especially with my 7 year old niece, Aurora, who I love soooooooooooooooo much, but omg I want to be close to her and she in person how she's growing and swim with her and boat with her. I don't know when this family thing happened to us. If we were like when we lived in NC, mostly just the two of us, we could live on a boat and just fly there twice a year and to Myrtle Beach those same times and be fine. We were so independent and now we're so interdependent. That's why I asked you the questions and now know our issues won't apply to you.

That's what we've done and as to what we'd worry about, it's simple. Separation from those important to us, those we love. It's not our home that's the problem, it's the people at home. When we lived in NC we could have made the change easily, but not today.

 

[2savage]

I follow a philosophy that helps: "Happiness is a close knit family..... in another Country!". In my case it's England and Sweden.

 

[O C Diver]

Maybe another option.

I bought a slip in a yacht and country club about a year ago. The purchase was to guarantee a slip when I returned from cruising each summer. With covid, winter dockage evaporated in SW FL. I own the submerged land. The condo association owns the docks, pilings and everything else. There is a waiting list to rent the slips.

If you could buy a slip such as I did. Pay cash for it. Be cash flow positive by letting the condo association rent it (there are significant fees and property tax). It would likely hold its value or increase. If you have to or want to stop cruising, it gives you a place to park the boat, live, and figure out what's next without being against the wall.

Ted

 

[Seevee]

There's an argument to keep a dirt home or two, just to keep up with inflation, unless you have a huge bankroll and other investment that will keep up.


The boat will most likely depreciate. So if you want to return to a dirt home... keep one.



Now, to keep one you most likely need to rent it to cover the costs and you need expertise to do that, which can be a challenge.

 

[Lepke]

Why would you want to return to shore?

 

[AlanT]

So lots of individual examples of tackling this problem (or avoiding it). Here's my take. We had (and still have) saltwaterfront property that, unless Mt Rainier explodes, will always be a premium property. We took off for an indefinite period on a sailboat that wound up being 4 years. We kept the property for the very reasons that you were concerned. This was before Airbnb was an option, but we rented it long-term with a clause allowing us to return and use parts of it when needed (it has two living areas). This worked well. After 4 years we were done, we returned, sold the boat and retained the property, which while we were away had doubled in value. If we had sold it we would have put the money in the market, and lost half of it in 2007-9, and we would then have had to liquidate stock in that market with no ability to await the subsequent boom in order to buy a replacement property and would have lost ~75% of the value in our property. So my advice is keep your property if you can, source an alternative property if you cannot and work out a way to afford it using long or short term rental. You may live the rest of your life on your boat and if so great, you still have options and a super investment. Sell the property and without a property to live in you have basically drilled holes in your lifeboat.

 

[AlanT]

Why would you want to return to shore?

Love it! Agree but I only have a 49% vote in that matter,
~A

 

[N4061]

Having the privilege of living aboard "part time" (Monday - Thursday) while working in San Diego for a few years was fun and the greatest time in our lives. What made this successful was having the house 100 miles away and being to be there in two plus hours (California traffic). When the weather was bad my wife would stay home i would commute or spend a night aboard. Fast forward a few years and heath issues got in the way of the boat and we sold her. Things improved purchased a couple more boats and found that living aboard was no longer for us. Never sold the primary house and glade we didn't. Today my wife is done boating and I'm looking towards sailing to stay on the water and try something new. Yes we sold the house and moved much closer to the water so day sailing or boating makes sense. Bottom line is life changes and it helps to have an alternate plan, just in case.....

John

 

[Muirgen Afloat]

Why would you want to return to shore?

So feeling this..

 

[Landshark]

With regard to financial considerations a boat is not like a house when it is time to sell. Fundamentally the boat will decrease in value while terrestrial real estate will increase in value. Point is that when you do move to land based living you'll have diminished financial resources to spend unless you have other traditional investments that grew in value.

 

[amapola]

We're not comfortable with giving up our land home so we are part time cruisers. We cruise for 3-6 months then come back home to re-provision. Plus, the dock is in our back yard so if we sell our home, we'd have to pay a marina for dock space.

 

[Papa Charlie]

We have been living aboard for the last 11 years. No ties to land other than our storage unit that has some furniture, other items and my tools in it. I am planning to retire here next year and moving back onto land has become difficult. You can't sell a boat while living on board. So that means that we have to move into a rental, then sell the boat to be able to buy our retirement home, where ever that ends up being. Property has risen far more than one would have anticipated, making our future purchase more difficult.


If it were me, and I had a home that I have owned for 29 years and a condo I would rent both of them out and start your adventure. Purchasing down the road will only get that much more expensive and at least here in the PNW, rental properties rates are excessive. That could generate a significant income.


If nothing else, if you decide to sell at any time you can, but don't make decisions at this point. You may find that being a full timer may not be the life you expect, you never know until you are there.

Even if you have to pay more for your monthly payments on the boat during this time you have the income from both your rentals to work with.

 

[Sleepy]

I learned two things when my wife and I sold EVERYTHING and moved onto our live aboard. 1. Not having a home base we could go back to was more difficult than we thought. Not that we wanted to alot but not having the option was a heavy anchor. 2. When we did decide to buy another home we found out how difficult it is to get a mortgage after retirement. Need steady income source regardless of how much cash you have in the bank.
A lot of the people we met along the way did the live aboard for part of the year then returned home to recharge.

 

[BandB]

I learned two things when my wife and I sold EVERYTHING and moved onto our live aboard. 1. Not having a home base we could go back to was more difficult than we thought. Not that we wanted to alot but not having the option was a heavy anchor. 2. When we did decide to buy another home we found out how difficult it is to get a mortgage after retirement. Need steady income source regardless of how much cash you have in the bank.
A lot of the people we met along the way did the live aboard for part of the year then returned home to recharge.

Wifey B: Great share.

As to #1- We're flying home Saturday after the summer cruise of our lives. So many wonderful places. However, we're so anxious, dying to be home and see everyone and everything. And it's will have only been 109 days. It just hits you at some point and ours is 6 weeks to 2 months.

As to #2 - Hadn't heard that one but always wondered as I'm sure they send our stuff to elderly trying to get them to finance. I figured they'd be pushing 90 year olds into 30 year mortgages. That's not meant as disrespect to 90 year olds but to banks. I mean these are the people who cause people making $30,000 to accumulate $80,000 of credit card debt.

 

[Steven Cyr]

I'm curious how others feel about this. I'm concerned that when its time to return to shore I can actually afford a roof over my head once the boat is sold. However, I'm equally concerned and focused on divesting myself of 90% of possessions and all real estate so I can be totally mobile and not waste many thousands on storing furniture that I might not like in 15 years.

I'm hedging my bets by selling my primary residence of the past 29 years (and its contents) but keeping a small Condo I also own and renting it to cover its costs and provide a little extra income.

What have others done? What are you worried most about?

We bought a Florida water front condo that we would want to retire in, and sold our family home in New England. That gives us a permanent dirt address for insurance purposes, where we can say we cruise the boat but live at the dirt address, so we can say we are not liveaboards. We also don't have the maintenance issues associated with a house. We are on the boat about 9 months a year, but return to the condo for various reasons. It also provides a place to keep our cars. When we eventually stop cruising the boat, we will still have our retirement dream home.

 

[O C Diver]

A lot of the people we met along the way did the live aboard for part of the year then returned home to recharge.

I definitely fall in that category. In a perfect world, I would leave SWFL April 1st and return home middle of November.

The nice feature of a winter off is a chance to go through the boat, do preventative maintenance, maybe a few upgrades and not be time pressured to get everything done.

Ted

 

[Simi 60]

Been out here over 5 years now

Still haven't managed to get back to do something with the dirt house, car, motorbike or other big project boat.
Bought this boat, moved on and ran away.

Bad us.

 

[FlyWright]

I LOVE being on my boat while fishing and cruising the SF Bay and CA Delta. I also love being in my home of 31 years during recharge and reset periods. I use this at-home time to reprovision and prepare for the next adventure, whether it's fishing or cruising. It's a blessing to be able to boat year-round in NorCal but I need a permanent address for my home church, mailbox and workshop.

YMMV

 

[Captain DJ]

We started cruising in a GB42 around 2000 at ages 33 & 35, that lasted full time 2 years and on-and-off a few more. We kept our two rental townhomes, three commercial downtown buildings and our home in a nice historic district in a Southern City.

It was a PITA collecting rents, maintaining 6 properties while cruising and we almost never got our boating buddy to leave our house, although we did tell him 2-10 years and we were just closer to the 2 years while he was hoping on the 10 years. Ultra cheap rent with all our furnishings made this newly divorced guy have it made.

Now we are back to a home in San Carlos, Sonora, Mexico, a small boutique hotel & restaurant and the three commercial renters. We wish we had kept the townhomes, they would be worth almost triple what we sold them for a decade ago...and possibly bring in more than the hotel or restaurant ...

Main idea for us is keeping low maintenance, low cost-of-ownership properties that bring in the most income.

I mention Mexico, because we love it and the cost of ownership is cheaper than anywhere in the U.S. that property is going up fast so if the idea appeals to you, let me know. We have over a decade south of the border (SOB) and have learned a few hard lessons.

Now cruising PNW June-Oct and enjoying Mexico during the other 6 months. Best of both worlds.

Good luck and enjoy whatever you decide to do.

 

[Donna]

I just sold or gave away everything. I had a boat, (many of you recall my adventures with southerly). She closed today. Before I sold her, I purchased a 55’ wide body Viking MY. I also had a 4000 sq. Foot house. Talk about a leap of faith. The dirt house closes on Thursday.

I’m writing this from my new home, Sunshine. I have been onboard for 2 weeks already getting to know her. I do most engine and general boat maintenance myself. I’m living on my hobby. I am an only child and my dad owns a beautiful home that is in a life estate so I have no worries for the future.

Of Course I worried that I wouldn’t like living onboard full time and maybe I won’t. But for now, it’s what I choose. I do not worry about tomorrow as there may not be one. I didn’t want to look back on my life and say, I wonder what it would have been like living aboard. I have no storage unit.

I still work, although a flex job. Some of you know what I do.

I have my coffee every morning with the dolphins, manatees, fish and birds before I start my day. I am so relaxed and the stress has melted away.

BTW, Southerly sold for way over what I purchased her for so take care of your boat and she will take care of you.

Good luck to all!

 

[Capt Ray]

We cut the cord May 2021. No dirt address except at St Brendan's Isle (mail forwarding service). Spend a small $80/mo for some self storage of only our best furniture. May 2022, we'll decide if we keep it another year or make our 28 year old son pay it if he wants it! LOL

Won't make sense to store this stuff for much longer than 1-2 years. Could not even get Goodwill and Salvation Army to come take a look!

Very liberating.

Shellerina.com

 

[friz]

I have been a "stay aboard" since 2018. What that means is that I have still had a house but chose to stay on my boat.

That phase of life is ending with my wife and I finally finishing up our married life.

Part of the reason I allowed this to drag on so long is that I was afraid. I have always had the fall back of real estate as a major asset and being without that is frankly scary.

I am almost 60 and figure that I have maybe 15 years of good health in which to explore by boat. After that my body is probably going to be getting long in the tooth to do things like crawl around the bilges, and medical issues might force me to be less nomadic.

What to do? In 15 years my boat that is worth in the range of a decent condo now will be worth some percentage of that, I'm guess ing 50-60%. While real estate will have risen 30-100% above what it is today.

If your boat represents a huge chunk of your net worth one might find themselves trapped living on a boat for life, at the mercy of liveaboard rules and quotas, making a prime location difficult or impossible to obtain.

A solution i am considering seriously is to take my cash and within the next year or two buy a condo or home somewhere and rent it out. My thoughts are to choose somewhere touristy enough to rent it out as a vacation rental Vs having long term tenants. That way I am not stuck in a declining neighborhood somewhere with a funky condo.

Where??? Well I'm starting my retirement cruising adventure as soon as the weather breaks for spring. That adventure will without a doubt expose me to places I never considered. Even countries that I never considered.

Another option is to keep it reasonably invested, but that has risk of course. Invest too conservativly and you do not keep up with inflation, and too aggressively and you might be in a market downturn right when you need the cash. At least with real estate even if it decreases in value you can live there.

Now... If one does not have that ability.... If their main asset is the money they have tied up in a boat with no option for simultaneous investment in real property then one must plan extremely carefully.

My opinion is that someone contemplating an active cruising lifestyle needs an exit plan at least for the cruising part. I see no problem growing old living on a boat but you need to at least plan on where to park it to live life post cruising.

That might be a condo slip with liveaboard rights. That might be buying a piece of property along a waterway where you could park your boat. That might mean paying rent in a slip full time that you are only using part of the year to get liveaboard rights. That might also mean being willing to finish out your years in a location with lax live.aboard rules and or no wait lists.

The big thing is to plan it out so that you do not find yourself 75 years old, in declining health and zero options.

You must be, or should kidding