Very in vogue throughout the United States and Canada since the 2000s, the “tiny house” trend is taking over the world. Are they right for you?
What’s a tiny house
The term “tiny house” can mean different things to different people. Some people incorrectly use this term interchangeably with the term “small house” to describe a home of conventional construction that is less than 1,000 square feet in size.
To others a “tiny house” is a home built on a permanent foundation using conventional materials and methods that is under 400 or even 500 square feet in size.
To yet others, “tiny houses” evoke images of miniature conventional houses (typically around 120 square feet) on wheels so that they may be easily moved from place to place. There are even some that will fall somewhere between these three main categories (large with wheels, smaller without wheels and so on). Imagination is truly the only limit where tiny houses are concerned!
Tiny house vs. park model home or travel trailer
Tiny homes are built using mainly conventional materials and styles whereas RVs are constructed in more utilitarian styles with lightweight materials. They tend to be heavier and less aerodynamic, often requiring heavier towing vehicles, possibly posing height issues during transport and requiring permits and escorts while moving, unlike travel trailers.
Tiny homes are meant to be permanent year-round homes, whereas RVs are more often meant as temporary and seasonal accommodation.
Living in a tiny house allows for savings. A tiny house will cost anywhere from $60,000 to $100,000 if pre-made, and about $30,000 if self-built—far less expensive than a traditional home, wherever it is you live.
There are, however, related costs that can increase your total expenditures, and they’re important to take into account when developing a budget. Do you need a plot of land? Will you require custom-made furniture, or will you have to buy appliances of unconventional dimensions?
It’s also important to keep in mind that tiny houses on wheels are considered trailers, so you cannot usually get a mortgage on these types of dwellings. Even for those that are fixed to the ground, a personal loan is often the only available financing option, as few banks will lend such small amounts as mortgages. Plus, unlike traditional homes, tiny houses are not generally considered an investment, as they do not accrue value over time.
Municipal permits and zoning are a thorny problem. A lot of municipalities have standards with regard to the minimum size of new permanent construction (many require at least 1,000 square feet). Also, owing to their small size, tiny homes may have difficulty meeting certain building codes (for example, when it comes to placement of electrical and plumbing systems). This is not to imply that many are poorly built; however, current design standards have a larger amount of space in mind.
Non-permanent structures also face zoning challenges, as many municipalities have bylaws that prohibit or limit the ability of people to live in non-permanent housing long term—even on land you own.
Last but not least, neighbours often have concerns over such housing with regard to impacts they may have on neighbouring property values and the impact on the tax base.
Size alone makes tiny houses eco-friendly: less building material is required, wood is often the material of choice and large windows optimize solar heat, cutting the heating bill.
In addition, if, like most, your tiny home is mobile, it can be placed in the shade in the summer or in the sun in the winter to benefit from seasonal temperatures. The bottom line is if you decide to make a tiny house your primary residence, you will greatly reduce your ecological footprint. If you decide to purchase a tiny house as a second home, however, this will not be the case.
Living in a micro-habitat means weaning yourself down to about 10% of the objects that you would have in a regular house. If this means a large sacrifice for some, others—minimalists, for instance—find it quite liberating.
Owning a traditional house means spending a lot of time on cleaning, upkeep and repairs. With a tiny house, a big part of this time can be given over to enjoying your life, your hobbies, your family, or traveling. On the other hand, as most people require a certain degree of personal space, it can be a challenge to live with others in such a small area.
Tiny homes and insurance
The impact of tiny homes and insurance will vary with the characteristics of each tiny home. Tiny homes that have the following characteristics should have little trouble finding conventional homeowner insurance:
- Built on a permanent foundation
- Constructed using conventional materials and techniques
- Equipped with central heat, plumbing and septic systems and electricity
- Built with permits, and having passed building inspections by the local building office
Tiny homes not meeting the above criteria may require a more specialised solution. Tiny homes built on wheels may need an RV-type policy. Homes built without modern amenities may also need customised solutions.
In all cases, your individual situation should be reviewed with your insurance representative to determine what’s available and what the best course of action is.