Tiny homes

[Gabe Pringle]

Hi - I am a Michigan resident with two single family rental properties in MI. I would like to move into vacation rentals and have a new business idea that I'd be interested to get feedback on any potential roadblocks you may see or know about. In short, my idea is to buy some land (1 acre or less) in a desirable vacation area in northern Michigan and create a small tiny home resort. Idea would be to have a website and list on airbnb, etc. The goal would be to start with 2 and expand up to 4ish ( as appropriate to not crowd the area). The tiny homes I am looking at would be on wheels but I would like them to be hooked up to utilities and ultimately be somewhat secured on the property. My question is does anybody know any zoning, insurance, legal, etc. items that would create any significant roadblocks to this idea? Any other thoughts or comments would be appreciated too!

[Leigh Ann Smith]

@Gabe Pringle and @Jonathan Thrasher, this is what we are doing in Texas.  We have 2 tiny homes currently, with plans to add another eventually.  Our tiny homes are on wheels, so they are technically RV's.  It's working out well so far.  We are in a rural area outside of any city limits, so no zoning restrictions.

We are NOT in a desirable location in terms of being near anything that anyone would want to visit, but the houses are on our Christmas tree farm, so it's an interesting location on its own.  

Our guests can walk through the fields, and we allow them to bring dogs.  The houses sit on a pond, and we have stocked it, so starting in the spring, our guests can fish there.

Most of our guests have been young couples having a weekend getaway.  Usually, they are fascinated with tiny houses, and that's why they chose us.  We've had a few who are attending family events nearby, a few who had jobs in the area, and 2 who were catching cruises out of Galveston the next day.  We'd like to get a few more of those job ones who will stay a week!

We're currently upgrading some of the tree farm facilities to be able to host events, and we believe that we will get guests associated with the events, too.

A big consideration when planning your tiny house village is infrastructure.  What will it cost for water, septic, electricity, and roads?  We spent about $23K on all of that.

CBIZ will not cover tiny homes on wheels, but we got insurance through Proper Insurance Services, LLC. We pay about $50 per house per month.

Our one frustration has been with pricing.  We had hoped to be able to charge about $100/night, but most nights we are charging about $74 (+ $25 cleaning fee per stay).  It seems like when I raise the price, the reservations stop coming.  Likewise for having a 2-night minimum.  It just doesn't seem like we can support that yet.  We began renting our first house in late June, and the 2nd one just a few weeks ago, so it's probably too soon to tell.  We've gotten all 5-star reviews, and the guests all seem to be very happy. so hopefully we can up the prices a bit in due time.

Let me know if I can answer any other questions from our experience!