Here’s why tiny homes are more popular than ever
The children cannot afford to buy traditional houses. Enter the small houses.
- Tiny home sales are expected to grow about 4% in 2022, accelerating in 2025.
- Tiny homes are more affordable than traditional homes.
- Tiny houses are easier than ever to customize.
Housing is expensive in America. As, really Dear. In June, home prices rose 11.2% from a year ago, selling at a median price of $428,379, according to Redfin. It’s approximate – and it explains why most Americans spend more than 50% of their income on housing.
Enter the small houses. They are green, fashionable and affordable. About 63% of millennials would consider buying a small home, according to a 2022 analysis conducted by Technovio. It’s no surprise: tiny homes are more popular than ever. The global market for tiny homes is expected to grow by around 4% in 2022, with most of it concentrated in the United States. The market is expected to reach $4.7 billion in global revenue by 2026.
The benefits of owning a tiny home are enormous – er, tiny. Here’s why.
Tiny houses are good for wallets
The costs of a traditional home can crush bank accounts between heavy down payments, high monthly mortgage payments, property taxes and maintenance costs. Consider that the median US mortgage payment alone is $1,100 – then add maintenance, home insurance and everything else on top of that.
Small household expenses are light in comparison. For one thing, they’re tiny, averaging between 100 and 400 square feet. Compare that to the average California home, which is 1,625 square feet. It’s no wonder smallholders are so financially stable. And that small square footage has tiny advantages. For instance:
- Tiny price tags. The median price for a professionally built tiny home (about 206 square feet) is around $60,000, according to The Spruce.
- Minimal monthly costs. According to Business Insider, total monthly housing costs can be as low as $600 and rarely exceed $1,000. This includes utilities and the cost of renting land. However, it does not include monthly loan payments for those who have financed the purchase of their tiny home.
There are many places to find affordable tiny homes for sale. Start by shopping around a bit if you’re hesitant to buy a tiny house. Or join the DIY tiny house community and build your own on the cheap.
Tiny houses are customizable
As tiny homes grow in popularity, so does the demand for greater customization. Boxabl, who built Elon Musk’s Tiny House, builds modular homes that can be mixed and matched, stacked on top of each other like lego bricks and combined however you want.
With advances in technology, suppliers are increasingly able to customize the size, color, shape and additional features of tiny homes. For example, tiny home manufacturer American Tiny House offers optional solar modules for customers who want to save energy or disconnect from the grid. Green energy options are especially important for younger homebuyers, who are more likely to prioritize reducing their environmental footprint. On average, a tiny house produces about 30% less CO2 per year than an average house – catnip for environmentally conscious millennials.
Do your research
Tiny houses offer a wealth of cool housing options. They are relatively cheap, customizable and increasingly available. If you are interested in buying a tiny house, be sure to check land prices in the area of your choice: unlike traditional houses, professionally built tiny houses are usually not delivered with land. Financing a tiny house also requires a little extra work on the part of the buyer. You probably won’t be able to get a mortgage because most lenders require a high minimum loan amount and a house on a permanent foundation. To finance a tiny home, you’ll want to look to an RV loan or a personal loan. The homebuilder may offer you financing through a third-party lender, but you should explore your options to find the best possible loan terms.
If you’re worried about missing out on the tiny house trend, don’t be. As long as traditional home prices continue to skyrocket, tiny homes are here to stay. And buyers new to the home buying market will continue to look to the tiny home market as the path to financial freedom.
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