Tiny homes offer many benefits. If you take up less space, you reduce your eco-footprint. You also have less to take care of which frees up your time.
Of course, saving money is also another reason to live in a tiny home. For example, a smaller space requires less energy. Therefore, tiny homes usually mean lower monthly bills.
However, not everything about living in a tiny home is great. Even when it comes to cost, there are things to take into consideration. Before you invest in a tiny house, do your research to make sure the benefits outweigh the drawbacks.
Financial Benefits of Tiny Homes
Tiny homes can be a really smart choice if you want to save money on housing.
First of all, the cost to build a tiny home tends to be a lot cheaper than the cost of a regular house. A typical home usually has a large mortgage. In contrast, you can build or buy a tiny home at a fraction of the cost. You save money on the overall cost. Furthermore, you save money on monthly payments.
Likewise, utility costs tend to be very low in small homes. The small space is the primary reason. However, this also has to do with how tiny homes are built. Most people who choose tiny houses include low-energy features in the design. For example, you might use a compostable toilet, which saves money on water costs.
The biggest costs for a home are the mortgage and utilities. Therefore, you definitely have the potential to save money with tiny home living.
Costs of Tiny Homes to Consider
That said, there are some things worth considering as you tally up the financial reality of a tiny house.
First of all, not all tiny homes are cheap. You can buy one on a budget. However, there is a huge price range in what is available. Additionally, there are big variations in price if you don’t buy a tiny home as is. Most people actually don’t. Instead, people who buy tiny homes tend to get everything customized for their needs. After all, when you live in such a small space, it really needs to suit you perfectly. Therefore, the design and building costs can add up. In fact, some contractors markup their costs more for tiny homes than for larger places to boost their overall earnings.
Next, you have to consider the cost of the property where you will live. You may need to buy land to park your tiny home on. Each area has its own rules, regulations, and associated fees. As a tiny homeowner, you need to look at zoning, building, land use, and inspection fees. You’ll have to compare these to the costs of property fees for a regular house. Furthermore, you may compare those costs to those of renting a home for a little longer.
Similarly, you may find it challenging to get homeowner’s insurance for tiny homes. The cost for what you do get might be higher than you expected. At the same time, your home may be more likely than a regular home to incur damage. For example, your tiny home might be impacted more by a hurricane than other homes in the same area.
Tiny Homes May or May Not Save You Money
Tiny homes can save you money, but it depends on the choices that you make. For example, tiny homes have less space, so you tend to acquire less stuff. However, that doesn’t mean that the stuff you do get will be cheap. For example, you might opt to get a very tiny, efficient vacuum that costs a lot of money but doesn’t take up storage space. Therefore, you may spend more on a vacuum than if you bought a regular house with more storage. These things can all add up.
Finally, you have to think about the house in terms of its financial value. Are you able to rent out your tiny home to others when you’re away? If so, then it can earn you money. On the other hand, tiny homes don’t have a typical mortgage; therefore you can’t simply refinance them when you need the cash. Likewise, a tiny home may or may not have good resale value in the future. These are all things to take into consideration if you want to live frugally and are considering tiny homes as a housing option.
Read More:
- What to Expect at a Tiny House Conference
- How Tiny Homes Help People Save Big Bucks
- Rent-to-Own Home Buying: Financial Pros and Cons
Kathryn Vercillo is a professional writer who loves to live a balanced life. She appreciates a good work-life balance. She enjoys balance in her relationships and has worked hard to learn how to balance her finances to allow for a balanced life overall. Although she’s only blonde some of the time, she’s always striving for total balance. She’s excited to share what she’s learned with you and to discover more together along the way.