This Niche is Piquing a "Little" Interest

Written by Posted On Friday, 17 August 2018 12:01

When you hear the words “tiny house” what comes to mind?

 

Do you think of the dollhouse your mom (or grandmother) talks about playing with as a child? Or perhaps you picture the miniaturized communities meant to save the overpopulated world in Downsizing (starring Matt Damon). But in the real estate world, a tiny home is an actual asset available to buy or sell. And they’re not only for preppers and off-the-grid-type lifestyles anymore.

Over the past several years, there's been a growing community of people who embrace tiny homes. Thanks to shows like HGTV’s Tiny House Hunters the tiny house movement has become more mainstream.

In fact, a survey conducted by CustomMade reports that 34% of Americans between the ages of 18 to 34 would definitely or seriously consider living in tiny homes. And people are being drawn to these diminutive dwellings for more than minimalistic reasons.

The question is: As these compact castles grow in popularity, is it a niche worth looking into as a real estate agent? Although you'd be hard-pressed to find an MLS listing for a tiny house that doesn't mean there's a lack of inventory. Websites like Tiny House Listings and Tiny House Finder are popping up, adding inventory on a regular basis.

There are pluses and minuses when it comes to tiny houses. Here are some things to think about.

Some of the factors that draw people to the tiny house movement include:

  • No long-term mortgages, resulting in overall debt reduction
  • Lesser carbon footprint due to fewer materials and resources used, plus many homes are constructed with eco-friendly materials
  • Tiny homes are often mobile, allowing freedom to seek adventure
  • When a tiny house is mobile the possibilities of where to “set up home” expands
  • Less time spent on maintenance and cleaning
  • Decreased overhead which translates to more money in savings

 tinyhouse

Despite increasing momentum of the tiny house movement, there are still obstacles to living small.

 

  • The biggest obstacle faced by tiny home lovers is zoning issues; many cities’ laws don’t allow for tiny homes to become permanent residences
  • Although the typical tiny house costs about the same as a new mid-size sedan, many banks are reluctant to give loans. This makes financing (if needed) difficult for some people.
  • Some tiny homes are too small to accommodate a washer and dryer. This requires trips to the local laundromat.
  • Resell potential can be more difficult due to a smaller buyer’s market

As mentioned earlier, not all tiny homes are used for downsizing or minimalists. Consider the writer who needs cozy solitude or the retirees who have always dreamed of a small cabin in the woods. Some other interesting purposes include a micro guest house, a separate dwelling for the in-laws, a place for the “adult child who just won’t leave” to stay, or a specialized hobby workshop. These ideas open new markets for the tiny house.

What do you think about the tiny home movement: Will interest continue to grow or will it fade away in a few years? Are you a realtor who's ventured into the tiny housing market? We'd love to hear about any successes, plus what you've done to overcome some of the obstacles mentioned above. Please share your insights in the comments section below.

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