What Are Floating Homes? Cost, Benefits and More

Living in a floating home isn’t just about having a unique address, it’s a lifestyle offering peace and adventure. From enjoying breakfast with a view of endless water to feeling the freedom of being untethered from traditional housing, a floating home brings a sense of connection to nature and a different rhythm to life. Whether you want an opulent or bohemian lifestyle, a floating home is unconventional living at its finest.

“The fact that you can park your car on the street and walk down to your home on the water feels like you’re leaving one world for another,” says Jann McFarland, Seattle, Washington, resident and office manager of the Seattle Floating Homes Association. “My home sits on Lake Union and it’s so beautiful. Living here is like being on a never-ending vacation.”

Just as it sounds, floating homes are dwellings that float. They’re supported by logs and flotation devices designed to rise and fall with the motion of the water. Floating houses are permanent residences that are not intended to be moved and are within a stable floating home community. These dwellings are in mooring slips, which are rented or owned in a condo or cooperative homeowners association (HOA).

Although people often use "floating homes" and "houseboats" synonymously, they differ. Both are on the water and offer waterfront views, but there are some key differences. 

“Houseboats are registered vessels and have different regulations than floating homes,” says McFarland. “Unlike floating homes, houseboats have motors and can move freely, although most stay in place.” Both houseboats and floating homes are considered personal property subject to property taxes.

In addition to being a permanent dwelling, floating homes are similar to land homes in that their square footage can vary, ranging from tiny homes of 400 square feet to multi-story properties of 2,000 square feet.

Floating homes offer a unique waterfront living, but there are various costs to consider, from the initial purchase price to ongoing maintenance.

Before you purchase a floating home, there are various costs to consider. The initial cost is the purchase price. Home prices typically include both the co-op share (moorage spot) and the house. However, on rental docks you pay separately for the house and moorage. 

At one time, floating homes were not as coveted as they are now and were considerably less expensive than land homes. Today, floating homes can cost the same, if not more, than homes on land. 

Home prices start as low as $400,000 and reach into the millions, depending on the condition and location. “I purchased my home for $6,000 in 1973,” says McFarland. “And then purchased the moorage for $55,000 in 1984 when our dock went co-op-purchased from our moorage owner. Although my house needed work, houses were inexpensive back then. Floating homes were places for longshoremen, hippies, students and other low-income folks.”

Although many people compare buying a floating home to buying a condo, obtaining a loan may take some leg work. Not all traditional lenders and state financial institutions offer financing. There are a few exceptions, though. 

Trailhead Credit Union, founded in Portland, Oregon, offers floating home loan options. If you are looking to purchase a floating home as a secondary vacation home, applying for a home equity line of credit (HELOC) may be a good option. The best practice is to work with a real estate agent who is a floating home expert and can offer guidance on financing.

There are two main types of situations in which floating homes operate. The first is a cooperative community, where a homeowners association owns the moorage. In this setup, floating home owners purchase their homes and pay a moorage price and HOA fees. 

“If there are common expenses, such as dock repairs, the co-op pays for them. The cost is divided between houses,” says McFarland. 

The second setup involves moorages owned by an individual or a company. In this case, homeowners must rent their moorage space from the owner or organization.

Depending on where you live, property taxes vary. “Owning a floating home can be costly, but property taxes may be lower than for a land home, as you only pay taxes on the dwelling itself,” says McFarland. “The HOA dues cover the property taxes for the land underneath the dock.”

Like any property, floating homes require regular upkeep. Ensuring that the foundation and flotation devices are properly maintained is crucial. Many foundations are floats made from logs and air-filled plastic barrels. Heavy objects and furniture can disrupt the balance of your foundation, which will need additional flotation for support. 

“For example, if you place a grand piano in your house, you’ll need supplemental floats in the area underneath it,” says McFarland. It's also important to check for moisture damage to prevent potential wood rot. Depending on the age of the home, it’s recommended to have a dive inspector check the foundation every three to five years.

Jann McFarland has lived in a floating home for more than 50 years. Here are her insights into the benefits and drawbacks of a life on the water.

• The serenity: “We have clear views of sunsets and the water. It’s peaceful waking up to the sound and sights of the lake.”
• The neighbors: “Living in a floating home community is like having a big family to hang out with every day. If someone doesn’t have family, they’re bound to get invited to a party, gathering or dinner.”
• The wildlife: “Watching the beavers interact is really fascinating. They’re most active at twilight. They swim up and down the channel with their babies. It’s cool to see up close. I have a cute muskrat that lives under my house. My cats can hear it and it's funny to watch them running around and trying to figure out where it is underneath the house.”
• The view: “We can see people swimming, paddleboarding and floating around in the summer. And we have front-row seats to firework shows without driving and fighting traffic.”
• Immediate access to water: “Jump off your float to go for a swim or hop in your boat to go and grab dinner or a bottle of wine.”

• Living close together: “The homes are very close together, which some people find difficult. Limited interior space may not suit everyone, leading some to try this lifestyle briefly before moving on.”
• The animals: “If you don’t appreciate wildlife, this may not be the lifestyle for you. We have a lot of animals, including otters and raccoons. If animals get underneath your house, they can burrow in your insulation. Beavers sometimes will eat your flowers and chew down unprotected trees.”
• Noise: “The children who are raised in floating homes are popular with friends wanting to come for a swim. Noise carries over the water, so loud parties after hours and barking dogs can be an issue.”
• Extreme weather: “High winds can be really scary as they cause your home to bounce around. If it snows, you must remove the snow quickly, or your home could sink from the weight.”
• Lack of parking: “Parking is limited. We purchased a lot before a zoning change and there are only 15 spots. Someone paid $200,000 to guarantee a spot. We have to park up on the street, and with more condos being built, it can be difficult to find a spot.”

Floating home communities are a global phenomenon, with prominent examples in Amsterdam, Netherlands, which has 2,500 homes and ranks as the city with the most floating homes in the world, many of which are over a century old. 

In the U.S., these unique dwellings can be found in diverse locations such as Queens, New York, as well as Key West, Florida, and Annapolis, Maryland. Floating homes can also be found in various cities and towns across Louisiana. Below are the top three U.S. cities with the most floating home communities. 

The Portland floating home community consists of about 1,400 dwellings, making it the largest in the U.S. Many of these overlook the Multnomah Channel and the Willamette and Columbia Rivers. 

Seattle’s floating home community is a bit more intimate than Portland, consisting of approximately 500 floating homes and roughly half as many houseboats. These homes are typically moored on the waters of Lake Union and Portage Bay. Seattle restricts the growth of their floating home community by capping the number of both houseboats and floating homes. Anyone wanting to build a new one must purchase an existing property and demolish it and then renovate it. 

Sausalito is perhaps one of the most well-known floating home communities, with many homes resting on the San Francisco Bay. There are roughly 400 homes spread across the city.

It’s no secret that the residents make living in a floating home community special. “There’s always people barbecuing and doing things together,” says McFarland. “During COVID, it was the best place in the world to be. We were confined to our homes but could walk out on our back decks right onto the water with our neighbors. Overall, we’re a family with all different types of people.”

Living in a floating home offers wonderful perks like stunning waterfront views, a tight-knit community atmosphere and a close connection to nature. However, it also means navigating maintenance challenges, potential financing obstacles and adjusting to living in close quarters.

Ultimately, it's about embracing a unique lifestyle that combines serenity with the lively charm of waterfront living. Whether you're drawn to peaceful mornings on the water or vibrant community gatherings, a floating home offers a distinct and fulfilling way of life for those ready to dive in.