What You Need to Know Before You Buy or Build a Tiny Home
The average home size in the United States has increased over 50% in the span of three decades. From 1,725 square feet in 1983 to 2,598 square feet in 2013. Which is why realtors use the word “cozy” as a euphemism for “small.” That’s changing. More buyers are embracing scaled-down living and buying tiny homes. However, there are some big obstacles to owning one. Here’s what you need to know before you build or buy a tiny home.
Tiny homes are 100-400 square feet. They are usually built on wheels, although some are built on temporary or permanent foundations. Why would anyone want to squeeze their life into a space the size of a walk-in closet? Some want to reduce their environmental footprint. Others want to simplify their lives. For many, it’s about finances:
- 68% of tiny house homeowners don’t have a mortgage
- 60% have no credit card debt
- 55% have more savings in the bank than the average homeowner
Who Wants to Live Tiny?
According to the National Association of Home Builders (NAHB), more than half of Americans would consider living in a home under 600 square feet. 63% of millennials say they would consider living in a tiny home. According to the Tiny House Society, 2 out of 5 people over the age of 50 actually do live in them.
Where Do I Sign?
Before you run out and buy or build a tiny home, there are barriers to tiny home living you’ll need to overcome.
Tiny homes need to meet local building codes. Until recently, there was no standardization. The International Residential Code (IRC) just established specific guidelines. States base their local building codes on the IRC. This should help the tiny home sector moving forward.
Where to park it
Living in a tiny home can be a nomadic life. Finding a place to legally park your tiny home can be challenging. It’s considered an RV by most local ordinances. You can hang out in an RV park – but typically for just 2-30 days. Some owners park their tiny home on the lot of a friend or family member, but this can also be against local laws. Owners report that keeping a low-profile is usually enough to avoid eviction.
It’s easier to park your tiny home in a community that allows accessory dwelling units (ADUs). ADUs are permitted structures on the same lot as an individual home. Homeowners find a tiny home is perfect for aging parents, adult children who return home, offices, and even Airbnbs.
Tiny Insurance Premiums
Most insurance companies aren’t quite sure how to classify a tiny home. Is it a mobile home? A house?
Can you get Recreation Vehicle (RV) coverage for your tiny home? This insures the house and property while traveling and while parked. The catch is that most insurance companies require that the home is professionally constructed and certified by the Recreation Vehicle Industry Association (RVIA). This can leave DIYers out of luck.
If your tiny home is permanently installed in one location, you may qualify for mobile home insurance. Once you hit the road, you’ll need to get a temporary policy to insure the home while it’s in transit. Once you’ve parked, remember to let your insurance company know your new location.
At Young Alfred, we work with multiple insurance companies that specialize in policies for tiny homes. You want to ensure that you are dealing with a reputable company.
There are more communities embracing — and making allowances for — tiny homes:
- Spur, Texas no longer has a minimum size requirement for tiny homes on foundations.
- Fresno, California will consider tiny homes parked on a property with an existing home a permanent residence.
- Lake Dallas, Texas, now hosts a tiny home village. Owners can park their tiny home on a lot of about 800-1000 square feet for a monthly fee.
A Big, Tiny Life
Tiny living can give you big benefits. Financial security, flexibility, and simplicity. Take the time to research local laws, building codes, and the cost and availability of homeowners insurance before you buy or build. Then take just a few of your worldly possessions and move right in. Go tiny!
Get Tiny Home Insurance Quotes
At your service,