If you like the idea of minimalist living or want to downsize, tiny homes can seem very appealing. The tiny house cost is another advantage if you want to save money. But how much are tiny houses, and is this type of property within your budget?
Pricing for tiny homes will undoubtedly be much less than a traditional home. A smaller house with less square footage will have lower labor costs. The cost of materials for small homes is also much less.
The total cost for a tiny home will be significantly less than traditional houses, whether custom-built or prebuilt.
We will look at the average cost for tiny house projects to help you decide whether these homes are a good fit for you. Let’s look at everything you need to know before making an offer.
What is a Tiny Home?
A tiny house is a small, generally under 600 square foot home. Some circles will say it should be less than 400 square feet. There is no official definition, but it is usually considered a small house.
Tiny homes can be built on permanent foundations, but the most common type is to make them on trailers. This tiny house style is often called a THOW (tiny house on wheels).
There are a few benefits of building on wheels. By having wheels, the home becomes mobile, and you can get around local zoning laws that could enforce a minimum building size.
Due to the fact a tiny home is built on wheels without a permanent foundation, it is usually not restricted by local building codes. It would be more like having a nice shed in your yard. It is possible you may not need a building permit for a tiny home on wheels.
Building a tiny house with a foundation might not be possible if your community has a minimum house size. Many places do not allow an ADU or accessory dwelling unit.
As with most things in life, building a home on a trailer has downsides. Minimum dimensions are allowed when transporting a structure down a road without getting a special permit. Typically, the allowable dimensions are up to 8 feet 6 inches wide, 13 feet 6 inches tall, and 40 feet long.
Most of the time, you don’t see tiny homes longer than 32 feet because it is much more challenging to transport.
What is The Tiny House Movement?
The tiny house movement is a growing architectural and social movement that encourages living in a small space. Many folks have figured out that a large house and all the added expenses are not paramount to their happiness.
Having their own tiny home is the best way to reduce the financial burden of owning real estate. Many involved in the tiny home movement are looking for custom homes. The ability to build from start to finish is appealing. The cost of building is much less, even with larger floor plans and more customization.
Permanent tiny homes are one of the best ways to become more financially independent while still having a primary residence.
With tiny houses becoming more popular, more tiny home builders are popping up.
How Much is a Tiny House?
One of the most common questions is how much does a tiny house cost?
Perhaps surprisingly, tiny homes are more expensive per square foot when you compare them to traditional homes. Tiny homes average around $300 per square foot, whereas stick-built homes cost $150 per square foot.
Despite double the cost per square foot, an average tiny house will cost much less than a traditional property. Average tiny houses can cost between $30,000 and $60,000.
Though if you are determined to cut costs as much as possible, this could be less than $10,000. On the other hand, if you want the highest possible specification with all of the amenities, costs could rise above $150,000.
Even so, the tiny house price is much less than other types of properties.
As you might imagine, if you build the home yourself, it will be cheaper than a pre-built home. Though it is easy to misjudge costs and encounter more problems than you initially expect, raising your budget is higher than planned.
Many factors will affect how much you pay for your tiny property. These include:
Choosing foundations or wheels
Amenities and finish
Building materials used
If you want to keep the costs of your tiny home in check, it is easier with this type of home than with a traditional build. These homes can be customized to your requirements, allowing you to keep costs low.
What Will a Tiny House Cost to Build?
How much does it cost to build a tiny house?
While choosing to build a tiny home is going to be the lower-cost option, you still need cash to cover the upfront costs. Before you begin your build, you must be fully prepared, including having the skills and money.
With some builds, you can easily find the cost of materials rising well above $20,000, even getting to $60,000. On top of this, there are building permits to pay for. Permits can cost you more than $1,500, with more significant and unusual homes increasing costs.
If you build your home on wheels, the cost will likely be lower than pouring foundations. Foundations are likely to add more than $5,000 to your budget.
How Much Do Pre-Built Tiny Homes Cost?
There are prefabricated options if you would rather avoid the stress and potential problems in building your tiny property. While this does mean you will save time, it does come at a cost. Tiny prefabricated homes can cost upwards of $75,000, though this does depend on the specification you choose.
If this is above your budget, you might be able to find a pre-owned tiny house that will meet your requirements. The prices for pre-owned homes start at around $30,000, though you may not find precisely what you are looking for. These homes are highly customized, and you might need to spend additional cash to change the property to meet your requirements.
You might be able to find some tiny homes in local listings, though a more expansive selection will be available on specialist national websites. When searching the listings, remember that this type of home isn’t usually going to qualify for a traditional mortgage, though you might be able to get a personal loan if you can’t pay cash.
Examples of Tiny House Kits
Would you like to view a sample tiny house kit? The Spruce showcases some excellent tiny home kits with pictures and descriptions. Have a look – it may spark some inspiration on your part. Seeing what other tiny homeowners are doing is always helpful.
Hidden Costs With Tiny Homes
Besides the obvious costs involved in building a home, there might be some you haven’t considered.
Location Plays a Role
When building this type of home, you will need somewhere to put it. This might be less of an issue if it is on wheels, but you still need to know your costs.
If you plan to place the home for free on a member of your family’s land to save money, that could be a problem. Sometimes zoning laws will not allow this, and they could also place other restrictions on your home’s construction. Before you decide a tiny house is suitable for your needs, check the zoning rules in your area.
One of the most significant hurdles people encounter when purchasing a tiny house is finding the right location.
Building codes vary from state to state and even town to town. Many areas will have restrictions that you can’t live in a vehicle on a property for more than 30 consecutive days. Many places will classify a tiny house as a recreational vehicle.
Plan For Utilities With Tiny Homes
There will be costs to connect your home to the utilities. Where the house is located can significantly affect this cost. If joining isn’t easy, you might need to consider renewable energy sources like solar panels and a septic system for your new home.
Homeowner’s Insurance is Still Essential
Insuring your home might not be as easy as a stick-built property, and it can cost more than you expect.
There are two different types of insurance policies for tiny houses. Permanent tiny houses will have the same insurance as mobile homes. On the other hand, a mobile tiny house trailer will have RV insurance.
Don’t Forget About a Lack of Storage With Tiny Houses
If you are downsizing, having somewhere to store all your stuff could be an issue. Since there isn’t much room in the tiny house, you might need to rent a storage unit.
Furniture Needs to Fit Your Tiny Home
Don’t forget some additional costs with tiny houses, such as furniture and appliances. Your overall cost will go up with these purchases.
Likely, much of your furniture will not fit your new tiny property. This might mean purchasing new items that meet the restricted size requirements. Due to the smaller allotted space, you’ll likely need to plan for smaller appliances.
Tiny houses don’t necessarily hold their value in the same way traditional properties do. This can be more of an issue if you have customized your living space. Finding a buyer at the price you want can be difficult when you want to sell.
The Stages in a Tiny Home Construction Project
There are a few essential steps you need to take in the process when building your new home. Let’s take a look.
Your Land Purchase is Vital With Tiny Homes
You must find a lot to build on if your tiny house is on foundations. You can lease the land, though this isn’t a good long-term option.
When selecting the lot, you need to know the zoning laws that affect the land. It could be the case that it isn’t possible to build a home of this type in the area, making the land unsuitable.
Buying a tiny home using a mortgage isn’t usually an option, but other lending possibilities exist. A land loan provides the money to purchase the land your property will be built on.
Land loans can be more difficult to obtain compared to regular mortgages. It is more difficult for the lender to assess the value of the land when it doesn’t have a property constructed on it. This means there are more risks for the lender; because of this, they require larger down payments and generally charge higher interest rates on the loan.
It would be best if you had a good credit score and more money saved for the down payment. These expectations are on top of the money you need to build the home, so you may need more cash upfront than you initially expected.
This type of lending can be used to buy land to build a home on or for commercial reasons. Different land loans are available to suit borrower requirements.
It would help if you had a thorough land development plan when applying for a land loan. A detailed agenda will help the lender decide in your favor, showing them that you are less likely to be a risk.
Financing the Construction of Tiny Homes
A construction loan can give you the funds to build. This type of loan is only short-term; when the home is completed, the owner can apply for a mortgage to pay off the construction loan.
Once again, there are different construction loans depending on the project you are planning. Some loans only cover construction and need to be repaid in a year, and some loans convert into a regular mortgage once construction is complete, along with other options.
These loans are often more expensive, have higher interest rates, and are more challenging to qualify for. And if you have a construction-only loan, you will need to pay loan fees twice when applying for a mortgage.
Buying a Kit Home
If you don’t want to build your home from scratch, kit homes or buying a house shell are other options. Kit homes will provide a blueprint and a trailer to construct the home on. This will make it easier to buy the materials and build the house. Kits can cost under $10,000 and could be a good option for people with some construction experience.
A tiny house shell, where the exterior construction has been completed, gives you room to personalize the interior. Prices can start from $20,000, though the final price will depend on your required specifications.
How to Find Tiny Homes For Sale?
Are you wondering if there is an easy way to find tiny homes for sale? The best way is to find a local real estate agent who knows the current housing inventory.
They can begin scouring the area for potential tiny homes for sale. If you have just started your search and don’t feel comfortable yet working with a Realtor, you can do a Google search.
Try tiny homes for sale or tiny homes for sale near me. You should see some potential tiny houses to investigate.
Other Types of Affordable Housing Choices
Besides purchasing a new tiny home, there are other low-cost housing choices. These are great houses for low income.
Some include shipping container homes, modular homes, and mobile homes. Let’s look at all three.
Shipping Container Homes
Shipping container homes are becoming increasingly popular for homeowners looking to purchase a home. They are less expensive than traditional homes and can be modified to fit the homeowner’s needs.
Recycled shipping containers are being used to build homes on-site, which is sustainable and environmentally friendly.
Container homes can be tailored to meet the homeowner’s needs, including shape and size. Shipping container homes are becoming increasingly popular due to their low price tag, quick and easy assembly, weatherproofing, and durability.
Shipping container homes are also popular because they are affordable and environmentally friendly. They can be used as second homes and produce little waste.
Container homes are a more affordable option than traditional housing, but they must be located in an acceptable city. Not every town will allow this type of housing.
Modular homes are typically cheaper than traditional stick-built homes. This will largely depend on the design and amenities, but you can expect the price to be lower.
A smaller modular design can cost between seventy-five to eighty thousand dollars.
The two main modular home prices you need to be aware of are the factory direct and indirect prices. The factory direct price is the price a manufacturer charges for its own homes, while the Indirect price is the price at which a modular home builder sells homes.
Factory direct prices refer to homes built by a modular manufacturer, which tend to be more expensive than indirect prices.
Indirect pricing involves purchasing a home from a third party, which can be less costly than factory direct prices, depending on your chosen model.
Building a home can be expensive, depending on the base model and optional features. The cost of delivery, assembly and modular sections is already included in the base model price. The final cost of building your home consists of all necessary expenses, such as building foundations, connecting utilities, and landscaping.
Mobile homes are a low-cost housing construction option. One reason mobile homes might be cheaper than other housing options is that they don’t require as much maintenance.
Another reason mobile homes are less expensive is that they’re often located in rural areas or areas with low population density. This means they’re less likely to be crowded or have high prices.
Mobile homes are often more affordable than traditional homes, as they can be purchased outright instead of leased. While some people may find the stigma attached to mobile homes unattractive, they are a good option for those with lower incomes.
The average cost of a tiny house will compare favorably with all three of these housing choices.
If living in a tiny space fits your lifestyle, the lower costs are also likely to appeal. Despite cheaper construction, the costs involved still need to be planned for so that you don’t find yourself with bills you can’t cover.
If you require a loan for a tiny house, it is more challenging to qualify, and the costs are higher. You also need to be realistic about whether you can do the construction yourself or if it is better to buy preowned.
About the Author: The above Real Estate information on the cost for a tiny house is provided by Bill Gassett, a Nationally recognized leader in his field. Bill can be reached via email at [email protected] or by phone at 508-625-0191. Bill has helped people move in and out of many Metrowest towns for 35+ Years.
Are you thinking of selling your home? I am passionate about real estate and love sharing my marketing expertise!
I service Real Estate Sales in the following Metrowest MA towns: Ashland, Bellingham, Douglas, Framingham, Franklin, Grafton, Holliston, Hopkinton, Hopedale, Medway, Mendon, Milford, Millbury, Millville, Northborough, Northbridge, Shrewsbury, Southborough, Sutton, Wayland, Westborough, Whitinsville, Worcester, Upton, and Uxbridge MA.
Cost For Tiny House: What to Know About Tiny Home Prices
Do you want to know the cost for a tiny house? See everything to know about how much a tiny house costs with prices to build.