Tiny Houses: Fad? Or Here To Stay?

Tiny Houses Fad Or Here To Stay

Tiny homes are appearing all over the country and are popular with young buyers and downsizing retirees. With current trends in housing, more tiny houses may be built in urban areas instead of large homes. Numbers of young home buyers and retirees are growing around the country, so the housing market may have to change to accommodate their needs. 
Home sizes have gotten larger over the last 40 years, but families are smaller, so a lot of people don’t need the extra space. Large homes are expensive and come with high mortgage payments. A tiny house can sit on an existing lot that a family member already owns, as long as there aren’t deed restrictions on the lot.

Tiny houses are an efficient solution for anyone who wants to live a minimalist lifestyle. Young, military families are finding that they’re an attractive solution to base housing. It’s easy to park a tiny house in an RV community during deployment and move it when you’re transferred. A feature that appeals to a lot of tiny house owners is that the plans are flexible so you can customize the home. Many buyers do a lot of the labor themselves, so it cuts down on costs. The money saved can be used for custom energy-saving appliances or windows.

The concept of tiny living isn’t anything new. In the 18th and 19th centuries, a lot of people lived in log houses or small cottages. During the early 1900s, home kits were sold that were numbered and constructed on home lots. The structure of the home, all the moldings, fireplaces, and kitchens were included in the plans. A tiny house usually costs anywhere from $10K to $90K.

Bad experiences with mortgage companies in the past are causing buyers to re-think going into debt with a high mortgage. Others are choosing tiny house living as a way to save for retirement. Living off the grid can save money each month, and by not paying interest on their mortgage, they’re able to invest in a retirement account which allows them to retire sooner.

People are more concerned about the environment and energy consumption. Tiny houses allow homeowners to incorporate a lot of features that save energy. The new trend is the “Katrina Cottage.” This concept was created by an architect as an alternative to trailers put up by FEMA after Hurricane Katrina, and are based on 20th-century prefab homes. The cottages gain popularity as buyers look for homes with less space than conventional homes.

The consensus is that as more buyers look for smaller homes, the tiny house market will continue to grow.

Chris Burch is a venture capitalist and investor of Cocoon9 tiny houses.

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