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We've been building tiny houses for the past year and a half (4 houses total, two of which we've sold). After talking to a couple of hundred people interested i
by harmmonica 4y ago
We've been building tiny houses for the past year and a half (4 houses total, two of which we've sold). After talking to a couple of hundred people interested in tiny houses, here's what we've learned:
The wheels/trailers are "dumb" because almost nobody wants to move them once they get them in place. So as far as we can tell the only reason to build on a trailer is to avoid regulations in many locations throughout the US (an example: where we are in New Mexico if you build a house on a foundation you need to hire licensed plumbers and electricians whereas if you build on a trailer you can DIY; needless to say licensed professionals are far more expensive that doing it yourself so there are significant savings when you DIY).
The people interested in tiny houses seem to fall into three buckets (maybe 4): 1. people who want an Airbnb on their existing property (these are usually well-to-do folks who don't bat an eye at the pricing) 2. older folks who don't have the means to retire in a normal-sized house 3. younger folks who don't have the means to live in a normal house 4. if there's a 4th, it's younger folks who want a vacation house that they can Airbnb when they're not using it.
These 4 markets seem quite large based on the number of people who have reached out to us when we do pretty minimal marketing. And the reason we started doing this in the first place was to build below-market-rate housing (i.e., targeting groups 2 and 3 above), but there's a bit of a paradox going on here that we're trying to solve: groups 2 and 3 do not have the means to buy houses (tiny or not) outright so the only way we're going to crack this nut is if you can finance the purchase. We think we've found a way to do that, at least in our local market of Northern New Mexico, and we're just going through the proper channels with our local county to test this concept because lenders of course require that what you're building is legitimate. We're still hopeful that this will be a good solution locally, if not more broadly. Btw, we have never given a thought to trying to do this in an urban area. Doesn't seem sensible given land values where cheaper housing is almost by definition multifamily (i.e., >=2 units on a lot).
Edit: Oh, duh, here's a link to the house we build: https://santafe.craigslist.org/reo/d/el-prado-brand-new-fully-outfitted-tiny/7546789523.html https://santafe.craigslist.org/reo/d/el-prado-brand-new-full...
- dsalzman 4y agoIsn’t the biggest reason to build on wheels is to register the tiny house as a vehicle and not pay property taxes on the house value?
- harmmonica 4y agoWould take many many years to rack up property taxes that would equal the upfront cost of an electrician alone (due to the low value of the house/land, at least in non-urban areas). Also, almost everyone we’ve spoken with about tiny houses actually wants their city/county/state to recognize tiny houses as legitimate, including the taxes, because then they could legally live in the house full time. The problem is only a tiny fraction of locations in the US allow people to live in them full time.
- pxmpxm 4y agoThat's really neat looking!
- harmmonica 4y agoCheers! Thank you.
- bacchusracine 4y agoThank you for at least trying to price your units at a reasonable cost. I keep seeing these things at prices over a hundred thousand and it blows my mind. It's completely divorced from the idea that originally seemed to inspire the movement, to buy less house, minimize their 'stuff' to just the important things and pay off everything early. I wish you luck in your endeavors and hope that if I ever get a place where I can actually afford one I am able to get a unit like this one.
- harmmonica 4y agoReally appreciate you writing this because the progression has been difficult. In the interest of just figuring things out, we built the first house without much consideration for anything other than "can we build and sell inexpensively?" which we did manage to do for $50k. Some significant Covid inflation later, though, and that price is now a pipe dream, but we do think at the $80k number it's sustainable. And like I said the real goal now is to potentially get these financed so the people who can't afford to pay cash (i.e., most people who would be interested in buying) can actually get one of these. Anyway, thanks again. It's taken longer than we want, but we're making progress.