Moor than just a house

Ever wanted to live on a boat? – The community led housing (CLH) movement continues to grow, and we look at ways in which CLH might take to the water.

The community led housing (CLH) movement continues to grow as a response to the UK’s ongoing housing crisis.  Anyone can become involved in a CLH project, and this has seen the development of numerous housing projects across the UK that enable a diverse range of people to take action and manage projects that build good quality affordable homes.

CLH encourages community participation, giving people control of their living situation. Group members own, manage or maintain the homes in the way they find most appropriate. There are various CLH structures available to facilitate this, including co-housing, community land trusts, community self-build, development trusts, housing co-operatives and self-help housing. These structures ensure each new development benefits the local community, a specific group of people, or both. With CLH projects springing up across the UK, a huge number of people stand to potentially benefit from this innovative way of living.

Although CLH traditionally involves bricks and mortar, the development of moorings co-ops provides an alternative option for those preferring to live on water.  A mooring is a place where boats are moored and places such as London have seen a recent boom in people choosing to live on boats and barges, as a different way to enter the housing market.

 A moorings co-op involves a co-operative entity purchasing, or taking a lease over, a mooring, probably funded through a mixture of member loan stock and a commercial mortgage. The co-op then gives licences to its members to moor their vessels at a berth on the moorings. In most instances, the boats will be owned by individual members, but the co-op could also theoretically own the boats.

These types of co-ops therefore function like a housing co-operative but on water. They are likely to be “fully mutual” in the sense that you cannot be a member of the co-op unless you benefit from a licence to moor a boat (and are therefore a “tenant”). You cannot become a tenant unless you are a member of the co-op. This provides protection for the co-op and its members because if a member chooses to move on, any replacement has to be accepted into membership (and receive a new licence) to benefit from the berth of the member leaving the co-op.

There are several key considerations when setting up a moorings co-op, including financial viability, identifying a site, raising funds and determining how the co-op will be governed and the rights members enjoy. There are also complex tax considerations, such as whether a moorings would constitute residential property for Stamp Duty Land Tax purposes and if a member has investor loan stock and disposes of it when they leave membership, will they benefit from primary resident relief from Capital Gains Tax in respect of any gain made on their loan stock? Further information is available here:

https://www.gov.uk/government/publications/private-residence-relief-hs283-self-assessment-helpsheet/hs283-private-residence-relief-2020

Wrigleys can advise on setting up a moorings co-op. We offer a free 20 minute no obligation consultation to all (potential) CLH projects and can provide model documents for registration. We also work alongside Co-operatives UK, who act as a sponsor of model rules of housing co-operatives, to help you develop your co-op and receive ongoing support once you are registered as a member of Co-operatives UK.