May 09, 2016

Real Estate Trends: Tiny Houses


Downsizing. It's not only a common trend you find with many of your clients in the real estate world, but it's also become a milestone within people's lives. We've come to associate those doing the downsizing with empty nesters or recent retirees looking to simplify their lives. But in more recent years, it's not only that demographic looking to get a smaller home now that the kids are moved out doing the downsizing, it's become a trend even among Millennials and the children of those retirees. Instead of buying that starter home, they're starting with tiny houses.

Welcome to the tiny house trend.

These perfectly planned homes that take advantage of nearly every inch of space for functionality's sake are the latest and greatest in real estate trends that piggy back on both the idea of green living, and a more simplified way of life in the 'downsized' fashion. Still unsure as to why anyone would choose to buy a home with 200 square feet or less? Don't worry, we'll walk you through it, why your clients may want to buy one, plus where in the world you can find these tiny homes.

The Tiny House Trend

Playing it Financially and Environmentally Safe

You're probably asking yourself, why do people want tiny houses? What's the advantage of living in a seriously small space as opposed to the 'regular' American home? If you're going to be selling these homes, you'll need to understand why people want them and what's driving them to make their tiny decisions.

Well, the people who are at the forefront at the movement have two main concerns; financial and environmental, and tiny homes allow them a lot of leeway on both of these fronts. Think about it this way, the average American home is over 2,000 square feet, and as you know, the median home price in the United States is around $200,000. Now, depending on where exactly in the country you're selling, that price won't necessarily get your clients a 2,000 square foot home, but it doesn't change the fact that it's pretty expensive to buy right now.

Most Americans will spend a good chunk of their lives working just so that they can pay off that massive mortgage, leaving them stuck in a vicious cycle of debt. The main idea behind behind the tiny house trend is that it allows your home buyers to build or buy, and design their home without entering into that cycle of debt.

An increasingly popular choice for tiny houses aren't houses, but mobile homes, converted shipping containers, or small houses that can actually be towed behind a truck on a trailer...perfect for traveling! And perfect for millennials, known for job-hopping and their traveling tendencies who may find themselves in a place where buying the traditional home isn't viable for their location or current economic state.

The idea behind the trend of tiny houses is that without getting stuck in the trap of debt, tiny house folks can live in a home they own outright and do more of what they love, and less of the working that they may not love as much. But it goes beyond the money aspect, there's the environmental and green movement working as a strong force behind the scenes of the tiny house trend too.

Simplified: the smaller the house, the less energy utilized for heating and cooling costs. Plus, with the addition of a solar panel or two, a tiny house could conceivably go nearly off the grid with the exception of access to water. Yes, solar panels and other outfittings for greener, cleaner, and more efficient living may be costly, but those costs are almost all upfront, and only enable further savings and a far more earth-friendly lifestyle as time goes on.

Best places in the USA for Tiny Homes

Where in the world can you find the market for these tiny houses? They can be found all over, yes even possibly in the neighborhoods you already sell in! But there are a couple states in the USA that are a little more tiny house friendly, simply because of the existence of tiny house communities, the lack of laws that require a minimum square footage for homes and places of residence, or where there's a plethora of builders that specialize in building tiny homes. It doesn't come as too much of a shock that the top two states for tiny house living are on the west coast - California and Oregon.

This doesn't mean that tiny homes aren't a viable option in the rest of the country, it only means that it may be a bit more difficult for your prospective home buyers and builders who want to live in states with more stringent laws based on the minimum size of houses or mobile homes. Be sure to do your research and find out what the tiny home laws are in your area.

You'll want to know what's allowed, what the minimum square footage is for a home to be viable in the eyes of the law, and get a good feel for where there may be some tiny home communities in your local area. You'll want to be able to point your clients in the right direction and you can start by knowing if you can help them to the fullest extant.

As tiny houses grow from a trend to a tried and true movement, the more noise the advocates will be making when it comes to reaching out to lawmakers and legislators in an effort to make tiny home living more accessible in more places. Make it a point to find out who the advocates are in your area and reach out to them. Let them know that you're working with tiny house clients and ask if they can offer up any advice, or provide any further resources. The more you know, the better off you are for your clients!

Tiny House Resources

If you're a real estate agent with a client or two looking for a tiny house, there's plenty of resources out there for both yourself and for your clients who may be feeling bewildered at the prospect of a complete change in lifestyle and even culture. There are plenty of communities out there for tiny house folks and even more access to them via online communities and support groups, so to say, for those looking to embark on a tiny house journey.

[caption id="attachment_7237" align="aligncenter" width="590"] A glimpse into the options in the Tiny House Giant Journey home.[/caption]

Before you send your clients into a rabbit hole of Pinterest searches, which we do recommend for some beautiful and creative examples of tiny home living, there are a few major online communities that offer support to tiny home folks. Tiny Home Community offers a forum and information for 'newbies' as well as established people in the community, and those who are advocates.

The American Tiny House Association offers a deeper dive into more of the legislation and laws regarding tiny homes. This encompasses everything from construction guidelines to building codes per state in the country. There's plenty of online bloggers out there sharing their journey and the more personal stories could be more impactful for your clients. Send them to Tiny House Giant Journey, the blog of a couple who built their tiny house and take it on the road with them.

Making Downsizing a Trend

Lofted bedrooms, bookshelves that slide out of the walls, and fold-away dining room tables in bright airy spaces that open to the outdoors are a selection of what you'll find if you do a quick search online for 'tiny houses.' But this trend extends far beyond the picturesque (and sometimes mind-boggling organization) of the tiny homes you'll find online.

Instead, it's shedding a light on a demographic, and perhaps even a generation of people who are looking at their homes more as a place of convenience for sleeping, eating etc. but also allows for mobility and more connection with the outdoors. It also exposes a major shift away from the mortgages and large homes that may tie us to a certain place for a long period of time and instead a shift towards economic and environmental freedom.

But it must be a growing movement when we're suddenly seeing specials on channels like HGTV where our favorite House Hunters are on the 'hunt' for tiny houses for couples and families looking to make a big change. While these shows can sometimes be contrived, it's another great place to take a look or send your potential clients to glean some ideas for what the options are or some more real life ideas of how people live in their tiny homes.