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Things to Consider with Tiny Homes

Things to Consider withTiny Homes

Tiny homes have taken the real estate world by storm! Buyers love them for the minimalist lifestyle and aesthetic and low price. Investors love them for the high demand and creative investing opportunities.

A tiny home is usually anything smaller than about 600 square feet. Considering that the average American home is over 2,000 square feet, this is pretty tiny indeed! Other features are that they are often made with environmentally conscious materials and they may be portable, built on wheels or trailers.

The tiny home movement has broad market appeal. Let’s look at some of the ways to capitalize on tiny homes.

How to find them

Since tiny homes are not equivalent to regular-sized homes, you will not find them listed in the traditional places like MLS (Multiple Listing Service) databases on popular real estate websites. Also, note that you are only purchasing the tiny home— typically there is no land for sale with it. You’ll need a place to build or park the tiny home.

Here are some ways to find tiny homes for purchase:

  • Tiny home databases, several are available online or your realtor can be a good reference.
  • Online marketplaces, builders will post available options on models.
  • Through personal networks or connections, such as web forums.

If you have construction experience, you can also consider building your own tiny home! Many people might take this on as a hobby, but it’s an involved process that is best left to those with experience and skills. Certainly, leverage your power team members where you can to maximize your goals and ROI.

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How to furnish them

Since tiny homes are, well, tiny, furnishing can be tricky. Furnishings need to fit in the space, look good, and provide utility—the perfect challenge for someone who is unique and creative! Here are some tips on how to furnish tiny homes:

  • Consider exactly what is needed based on who will live there and their lifestyle. Only include what is necessary and will be used.
  • Use items that can be utilized in a variety of ways. For example, a bench seat can also convert to storage—this helps maximize space in a tiny home. This is a major need due to the limitations of space.
  • Get inspiration from other tiny homes. There are so many places to look online, such as Instagram or Pinterest, to gain inspiration from how other people have furnished their tiny homes on social media.

Where to put them

Since tiny homes do not come with land, finding somewhere to put it can be a real challenge. The most obvious solution is to buy land. Some municipalities or regions also have laws about where you are allowed to put them, so it’s important to do some research to make sure you are finding a legal place to put a tiny home. Here are some options to consider prior to getting your tiny home.

  • Put it on the property of a family or friend’s house. Make sure you consider zoning laws, as some places do not allow this. Gaining access to utilities should be considered.
  • Look at campsites or RV parks.
  • Consider putting it in a tiny home community. Some states allow communities of tiny homes to be put together, with communal areas like gardens.
  • Go off the grid and put the tiny home on some rural or farmland.

Ways to profit

Unlike traditional real estate where the land appreciates over time, a tiny home does not have that. So, someone who wants to make a profit from the sale of their home needs to add value in another way. Here are some ideas:

  • Flip the tiny home. Just like regular property flipping, you can take something that needs significant renovations, fix it up, and sell for a profit.
  • Add value by providing a place to park the tiny home. Since finding a place to put a tiny home is often a big challenge, this can significantly increase the value of the tiny home.
  • Have long-term or short-term rentals (i.e. through vacation rentals) in your tiny home.

Tiny homes have gained a lot of popularity in recent years and they present a fun and unique way for investors to make money. Because of the unique features of tiny homes, it’s important to carefully consider both the limitations and opportunities. Then, make a plan, get started, and enjoy the tiny home!

Areas of Review

Takeaway

Big picture takeaway points

  1. Tiny homes have become increasingly popular.
  2. You won’t find tiny homes listed on the MLS.
  3. Be sure to consider both the limitations and opportunities of tiny homes.

Reflection

Self-reflection questions to think more about the content

  1. How do I want to invest in tiny homes, flip, vacation rental, build, etc.?
  2. Can I think of a location that would be great for a tiny home community?
  3. Do I have power team members that I can go to for help with this project?

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