Any investors live in a Tiny House?

[Account Closed]

So this is an idea that my wife and I have been bouncing around for the last couple of months. We are new to investing and looking for some rental properties. Preferably we would like to start out with short term/Airbnb rentals, and long term depending on the area, if a deal comes up.

I wanted to know if anyone out there is currently living in a tiny house while running their business and if they are, any complications that they are running into. The good, bad, ugly, etc. I understand you have to comply with zoning regulations but surprisingly there are a decent amount of websites that already have the road mapped out for most of where you can go.

My wife and I have family all over the south east and we would like to restrict our investments to the same area (for now).

Any thoughts, comments, questions, experience, please feel free to post below!

Thanks,

Ethan

[Elizabeth Wilson]

@Account Closed - Not sure if I understand you.  Are you wanting to live in this tiny house or have it has an airbnb type rental?  If it is the first, are you concerned about the issues of running a business from such a small space or something else?

Personally, we are in the process of downsizing our place in Memphis in order to reinvest the equity in our house and pay significant less in property taxes (both with make me super happy!).   One of our concerns when looking for our new place was to make sure that it had enough storage and space for all our business supplies and documents.  And in general enough space to have an office area.   Luckily we found a great off-market deal that we close on this week! :)

[Jay Hinrichs]

@Elizabeth Wilson  in your markets your homes are already so inexpensive.. I see no need for tiny houses unless you just want a small cabin for weekends or something.. to me its a fad

or its filling a need in very HIGH priced areas were average home prices are North of 500k.. not 150k like a Memphis... and a tiny home for a 100k or so meets the needs of starter housing.

unfortunately even for tiny houses out our way land cost are such  75 to 100k per door JUST for the land before you put a tiny house on it .. and most are just mobile homes that are tricked out.. I had seen this coming about a decade ago with what are called Park Models I bought some of an RV/MHP I owned..

I personally cant for the life of me see how anyone can live in such small space unless they have very few possessions or rent storage space.. so if this grows then the storage industry will have to grow with it..  My out side storage shed at home is as big as a tiny home and filled to the brim  LOL.

However having cut my teeth selling Rural lands in N. CA I have many clients that went up into the hills built themselves Tiny homes decades ago and still live that lifestyle nothing new.

My partner in my airplane is on the Container house kick.. he is going to build whole subdivisions of Shipping container houses.. He donated one to the collage so they could work on it creating affordable space.. those work because you can stack them.. google some of the container home developments in Europe pretty interesting..

Next we will have little cocoon type accommodations like japan.. And of course in Tokyo Tiny houses are the norm.. its crazy what they build there.

[Anthony Gayden]

Ethan Fisher

My house is 1300 square feet and my girlfriend thinks it is tiny.

[Elizabeth Wilson]

@Jay Hinrichs - Oh, I'm not looking for a tiny house in Memphis!  Just wanted to sell to minimize home ownership costs and Memphis property taxes.  And we will be able to use the equity from the sale to not have to have a mortgage on our house.  We are going from 2200 to 1300 sq ft.  That is tiny enough for me. :) 

[Account Closed]

@Elizabeth Wilson both! We are looking to run our "home business" from our tiny house but know that it will only be temporary. We plan to keep the tiny house after we build our house and see how renting it out on Airbnb goes.

To clarify to my initial question, our business model is kind of irrelevant. I mainly wanted to know if anyone was actually living in a tiny home and what issues anyone was going through with that. A good follow up question (which wasn't mentioned earlier) would be to ask if anyone travels the country while running an investment business.

[Account Closed]

@Anthony Gayden haha. My wife and I downsized from a 1900 SF apartment to a 900 SF studio apartment in the middle of Atlanta. I don't think taking a few more SF away would be that big of a transition for us!

[Jay Hinrichs]

@Account Closed  I work in 15 states fly over 100k miles a year so yes some people travel the country working

[Account Closed]

@Jay Hinrichs cool, thank you for your input

[Teri Feeney Styers]

@Jay Hinrichs & @Account Closed I once created a "tiny apartment" in a flip house that had an awkward floor plan. 172 square feet. Studio style with 3/4 bath and full (if small) kitchen. The other part of the house was normal sized and both units opened into a common area laundry and access to back yard. I thought it was pretty nifty and so did the young couple that bought it. They use it as both an Airbnb and a "traveling nurse" short term rental. It gave the property more value than simply rehabbing a weirdly placed bed and bath. 

[Jay Hinrichs]

@Teri Feeney Styers excellent use of space.. ADU's are all the rage in Portlandia

[Mike Flora]

Jay Hinrichs this post brings me back to the question I was asking you a couple weeks ago. Tiny house on a trailer are registered as an RV and have no zoning. So when I was asking about costs for set ups of utilities to land, like you used to do, I was thinking of the rental of tiny home trailer set up here in Southern California Temecula wine country. Lease or buy the land out here and set up a nice camp site area where multiple wineries are. Location and weather is the key her and if you can finance a couple tiny homes and lease the land from the owner it could be very profitable. Minimal monthly payments and people come from all over to go wine tasting out here. 75 degrees in January as well. Looked into utility situation and since it's agriculture you can have a well drilled and have water/electrical. I guy does this out here and has a lot of cash flow off these. It's in my mind at this point but have to put the pieces together. The utility situation is the biggest part to figure out.

[Jay Hinrichs]

@Mike Flora  you will find in CA its not legal to camp on many properties.. I cut my teeth selling recreational land in CA ... so this was a common theme 40 years ago... and U certainly cannot get power to them without county approvals... so yes UTLS will be the issue along with neighbors complaining to the county.

[Account Closed]

@Teri Feeney Styers I agree. Great use of space! I would have never considered that, though I have seen some very awkward floor plans. Thanks for sharing!

[Mike Flora]

Jay Hinrichs yes on those things but if you own the land you can park your so called rv on your land. This is also very rural agricultural area so neighbors probably wouldn't even see them, but yes could be a problem. Still searching into this but highly desirable area to pull this off. LOCATION IS THE KEY ON THIS. Fresno CA actually allowing tiny homes to be built in people's back yard now. I believe they are the first city in CA to allow this.

[Account Closed]

@Account Closed I've actually been really curious about tiny homes from a real estate perspective, I think it really has a lot of potential and it has been in the news with the government giving tiny houses to homeless and even reports that some tech companies might buy up land and build tiny house communities to employees in the SF or Seattle areas. My favorite is this 3D printed tiny house and I think this kinda tech has the opportunity to be a big disruptor when it comes to real estate investing. You can literally 3D print a house for 10K. With building costs that low if you can purchase condemned or cheap land in densely populated areas your seed capital would be much lower than typical investing and you can get some new entrants in real estate investing and more scale starting out. 

[Shawn Zimmer]

I've looked into the tiny home thing but the biggest issue I ran into was zoning and permits. I'd love to see the day where you can just buy up stretches of land and put in tiny homes but I ran into nothing but bureaucracy when I tried looking into this in the Pittsburgh area

[Lesley Resnick]

I believe what you are referring to is a trailer park.  They have gotten bad name, but if we call it a, "tiny home community",  I think we are on to something.  I have not looked into it, but a premium level product might have a market.  You can typically exceed the population density than in standard construction.  

I am amazed by those shows, they show a 600 square foot house and "we have a Cocobolo wood floor and accent wall".  Meanwhile the floor is more expensive than marble and exceeds the price of standard construction per foot.  While it is small number of feet, the cost per share foot is crazy.     

[JD Martin]

My personal thoughts on "tiny houses", ie as seen on HGTV, is that this is mostly a fad by well-to-do upper middle class progeny who have never *had* to live in a real tiny house. One of my office staff workers and I had this discussion a few months ago - she, like I, grew up ridiculously poor, and essentially read my mind - mostly people who come from a very comfortable upbringing would think this is quaint. People like us find it crazier than hell, especially since most of the tiny houses cost as much as real houses. 

There are a lot of places in the Southeast that you can buy a whole house for $50k that includes heating and air and a real yard. 

[Thomas Williamson]

A little over two years ago my wife and I downsized from a 5,000 sq. ft. custom home into a 1400 sq. ft. home.  We first went from the 5,000 sq. ft. home to one of our rentals I had just renovated.  We lived there for a year while I renovated an even smaller home (the 1400 sq. ft. home), and eventually moved there once I finished with it. 

The end result is we got rid of our 2400.00 a month mortgage, and now live mortgage and rent free.  The only debt we have is eight mortgages on our investment properties. I work full time, so the goal was to get to a point where the rentals pay our monthly expenses, and I can bank my income for more properties.  Not exactly a tiny house, but it sounds like what your're trying to accomplish.

BTW, the purchase price for the 1400 sq. ft. was 55,000 on an acre of land.  I put another 30,000 in it to completely modernize it.  Good luck.  

[Anthony Angotti]

@Account Closed

My dream is to have a tiny house and live on the land of one of my rentals. For now I am house hacking, but eventually this is what I will do. 

[Account Closed]

@Anthony Angotti

Awesome! Thanks for sharing. I'd love to stay updated on that.

[Anthony Angotti]

@Account Closed

A client of mine actually introduced me to one of the companies that builds quite a few. Tiny House Northeast. 

They will let you go up there and see the operation, you can take classes on the design of the houses, and everything. 

It's pretty cool and sometime next year I was planning on heading up. 

[Matt Zale]

@Account Closed I can share my experience with you. I developed a tiny house community in Austin, TX.

[Account Closed]

@Matt Zale I would like to hear all about it!

[Patti Robertson]

@Account Closed - Not sure if this counts, but we lived in a 32 foot travel trailer on our existing lot for the last year while we tore down our house and built a new one.  I was never so happy as the day we left it for good.  It is still in the yard until we get it sold.