There is a new trend making a splash in the housing market. Instead of building giant, luxurious homes, some wealthy people are building tiny houses. These homes typically run about 100-400 square feet and offer mobility, minimalism, and eco-friendly living. Only a small section of people are willing to give up the space and other amenities of a “regular” sized house, but if you like the lifestyle it, you could save a lot of money.
Let’s Talk Cost
As you would expect, a tiny house comes with a much smaller price than a typical home. An already constructed tiny house would likely cost you over $50,000 while constructing your own could cost anywhere from $10,000-$30,000. Unless you have the money to purchase wholesale, you will likely need financing which is complicated, to say the least. Since many of these homes are not built on foundations, they do not qualify for a home loan. You could seek a personal loan, but at a much higher interest rate and with a high credit score requirement.
As mentioned before, a typical tiny house covers about 100-400 square feet depending on your needs. For many people, this is a major change in terms of space. If you are a person that likes storage space, you will not like the minimalist lifestyle associated with tiny homes. People who have lived the life-style claimed they had to ditch much of their belongings in order to live comfortably in the small space. And depending on if you are living solo or with a partner/kids, you can guarantee “me” time will be difficult to find.
On the other hand, the minimalist lifestyle may help you save money. Since your storage space is limited, you would be less inclined to buy new things. And since space is small, cleaning takes very little time and effort.
Another complication associated with tiny houses comes when you try to insure it. Similar to financing, a traditional homeowners policy is hard to come by. Depending on where and whether it is mobile or not, you could get a homeowners policy, but it is unlikely. In some cases, an insurance company may view your mobile tiny home as an RV, which means an RV insurance policy would cover you. Of course, you could seek a tiny house insurance policy from a company that only deals with tiny houses.