Have you ever fantasized about chucking it all and moving into a tiny house? Taking Marie Kando to the next level and really decluttering? Tired of getting outbid in the current housing war and ready to build your own? Amazon is making it easy by selling tiny houses – some of which can go together in 8 hours – with a good friend’s help – and probably a little bit of alcohol as a thank you!
While some people are moving into tiny houses as their primary residence, others are adding tiny homes to their existing property. Tiny homes can be a solution for sky rocketing housing costs in major cities, or a way for home owners to customize their properties.
Some tiny homes come outfitted with solar panels, convertible walls, mudrooms, and indoor swings. Others are sold as DIY kits that can be assembled in your backyard or on a rooftop.
An example of a DIY kit is a $7250 home measuring 172 square feet that can be put together in 8 hours with the help of a friend or two. The studio’s vendor, Allwood, said the structure is intended for backyard use as an extension of a main kitchen, not a permanent residence. It could also function as a yoga studio or pool house. Amazon lists the model as an “ideal home office or guest house.”
The space is divided between a fully enclosed indoor area and an outdoor deck that’s suited for grilling. At 172 square feet, there’s not enough room for a restroom or kitchen, though Allwood makes other models that include these amenities. While some tiny houses are actually very mobile – just hook them up to the back of your car and take off – this one is meant to stay in one place. If you want to move it – just take it apart, relocate and reassemble!
The average tiny home costs about $25,000 – significantly less expensive than a typical starter home in the DC metro area, and this studio is even less because it offers little else beyond walls, windows, and a roof.
To transform the $7500 version into a fully functioning home or guest house you will need to install electricity and air conditioning, which could increase the cost by thousands of dollars – and you still won’t have a kitchen or bathrooms. You will also need to purchase shingles and a foundation, which cost an extra $320, according to Allwood.
If you want a little more space, you might consider a $36,000 home from Amazon with 320 square feet. These larger homes are still somewhat bare bones, but they come complete with all the appliances, bath fixtures and hookups for plumbing, water and electric. Besides the $36,000, this tiny house will cost you $4,500 for freight shipping as it sadly falls out of the boundaries of 2 day Prime.
If you are thinking of building a small house, you need to proceed cautiously. While it seems like a great option to downsize and simplify, it is not simple to do.
Financing options: If you are trying to save money, you need to do additional research! Tiny homes may not qualify for traditional mortgages if they don’t meet minimum loan amounts. Instead, borrowers can use recreational vehicle, or RV, loans that are unsecured, fixed-rate mortgages with payoffs in two to seven years.
While these loans don’t have application fees or closing costs, then can have higher interest rates that traditional home loans and can be capped at $100,000. They’re also NOT tax deductible.
Another option is to find a lender that specializes in tiny home loans and is willing to fund a loan for less than $100,000 for a home that isn’t built on a permanent foundation.
Zoning laws: Laws vary by local, county and state zoning regulations, so start by looking up the regulations in your state that’s offered by the American Tiny House Association.
Some laws have a minimum square foot requirement for new houses on foundations, may not allow a tiny house in the back yard of an existing home, and have a time limit for “camping” on private land. If the land you want to settle on doesn’t meet all of the zoning requirements, you may not be approved for a loan.
Neighbors: Make sure that your neighbors are okay with your building a tiny house on your lot. Even if the zoning allows construction, your neighbors may not be welcoming. Wichita Kansas is dealing with this right now. The city council approved a plan to put about 90 tiny houses on 15 acres of land just outside the city limits at Harry and 143rd Street East. More than 30 residents came to a meeting on August 21 to oppose the plan. The site is surrounded by homes on large lots valued at $300,000 to $1 million.
The tiny homes are projected to be about 500 square feet plus loft space for sleeping and to sell for less than $100,000 each.
“It’s a great concept but a terrible location,” said Russ Hamker, one of the neighboring homeowners.
Neighbors said they’d been told by Realtors that they’d lose about 30 percent of the value of their homes if the tiny house development is built.
The developer, David Murfin, made two requests to allow the project to go forward: annexation to the city and approval of a plat for the development. According to Planning Director Dale Miller, annexation automatically rezones the land from a minimum lot size of 20,000 square feet to 4,000-5,000 square feet. And if annexation was approved, the City Council has no legal authority to deny the plat, said Miller and City Attorney Jennifer Magana.
Extra costs: Building a tiny home can include such costs as buying a parcel of land, construction costs, solar panels, furniture, landscaping and ongoing maintenance.
The good news is that if you’re using an RV loan, the money can be spent however you choose and not just on purchasing a tiny home. The money can be used to buy smaller furniture to fit in the tiny home, special building materials you may want to make the home more energy efficient, and to start a maintenance fund.