Public bug reported:

No snaps appear to work with encrypted home. For example, even the
'hello' snap does not function: failed to create user data directory.
errmsg: Permission denied


The error message appears to be a bit misleading, since the ~/snap/hello/1 
directory tree is created, so the snap can access the home dir.


Workaround:
Install without encrypted home, if you do that snaps work properly.

However, see this comment for a possible workaround:
https://bugs.launchpad.net/snappy/+bug/1574556/comments/5

ProblemType: Bug
DistroRelease: Ubuntu 16.04
Package: snapd 2.0.5
ProcVersionSignature: Ubuntu 4.4.0-24.43-generic 4.4.10
Uname: Linux 4.4.0-24-generic x86_64
NonfreeKernelModules: nvidia_uvm nvidia_drm nvidia_modeset nvidia
ApportVersion: 2.20.1-0ubuntu2.1
Architecture: amd64
CurrentDesktop: Unity
Date: Wed Jun 15 10:02:35 2016
EcryptfsInUse: Yes
InstallationDate: Installed on 2016-01-01 (165 days ago)
InstallationMedia: Ubuntu 16.04 LTS "Xenial Xerus" - Alpha amd64 (20151209)
SourcePackage: snapd
UpgradeStatus: No upgrade log present (probably fresh install)

** Affects: snapd (Ubuntu)
     Importance: Undecided
         Status: Confirmed


** Tags: amd64 apport-bug xenial

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https://bugs.launchpad.net/bugs/1592696

Title:
  snaps dont work with encrypted home: failed to create user data
  directory. errmsg: Permission denied

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