Tiny home popularity is booming both in America, the UK and all over the world. Technically, these ‘properties’ have to be under 400 square foot, yet one of the things that makes them so appealing, their mobility, means they are usually only 200 square foot because of the size of trailers available.
Yet it’s not just the location freedom that has fuelled tiny house popularity. These fun, creative homes have become a popular option for owning your own home, for everyone from young singles to small families. The tiny house movement champions simple living, freedom to move and cheap living.
In 2019, the average house deposit was £26,000. The staggering house prices mean that up to 40% of young adults cannot afford to buy in their area. In contrast, a self-built tiny home could cost just £20,000. This is a reasonable amount of money to borrow with an instalment loan and could be so much more achievable for young people looking to move out. Yet this doesn’t include the cost of buying land, which might be required depending on the style of the tiny home in order to establish a permanent, stable residence.
The movement has generated jobs, ingenuity and more and more flexibility when it comes to work and life balance. Some tiny homes depending on their mobility and size may need planning permission and placement restrictions may apply. You should check what restrictions apply, including permits, with local authorities or the local council and if planning permission is needed for the type of tiny home you are looking to acquire.
Our guide is looking at why these little slices of heaven are so appealing, but also the effect of tiny house popularity in the future as well as costs you might not have considered, like ongoing rent payments.
So, Why Are Tiny Houses So Popular?
Environmentally Friendly Living Alternatives With Built-In Savings
The smaller the house, the less energy is required to heat, light, cool and live inside it. The average UK household had a duel energy bill of £1,254 in 2019. This equated to 5% of the average household budget. This is a considerable percentage of income spent on simple gas and electricity, which is an absolute requirement to heat homes, cook food and so much more! As tiny homes in the UK are a relatively new concept, there are no concrete studies or reports on the running energy costs. However, it is expected that a tiny house only consumes 7% of the energy of a traditional home, equating to £87.78 spent on electricity and gas. The cost savings are huge, but the reduction in consumption is also a benefit for the environment as 40% of UK
Tiny houses are doing so much for eco-friendly movements. Even energy costs as low as £87 can be minimised further with the installation of things like triple glazing and solar panels. Tiny house popularity is also fuelled by the flexibility and customisation to make your home your own. You can live totally off the grid, with very little utility bills to pay if this is treated as a priority during the building process.
Another considerable saving when it comes to the functionality of the home is repairs. If your roof leaks, there’s a much smaller space, and fewer materials required to complete the fix. This could reduce ongoing maintenance costs considerably. However, the size of a tiny house does mean that they usually require custom appliances and fixtures, such as log burners, which are a very popular feature, all of which can be more expensive than standard household features. This could require a slightly bigger financial cushion to fall back on in the event of an emergency, failing to do so could lead some people to rely on a payday loan to deal with the situation at hand, as soon as possible.
Generation Rent Can Own Their Homes
Tiny house popularity starts with the financial appeal. The rise in house prices has meant that first-time buying, and saving for a deposit, is simply not a realistic option for so many people, forcing more and more Brits into private renting. Tiny houses solve that problem. They become extremely appealing to people who are facing paying 75% of their income into renting with no prospect of saving. Tiny homes afford younger people and families with independence to live free of shared accommodations or away from their parents.
Tiny homes allow many people the financial breathing room to build up their savings and to gather a house deposit, if that’s their goal. Building up a financial fall-back when an emergency strikes can be invaluable and something we here at Wizzcash always encourage. Studies in the US show that millennials struggle to save because of the money they spend on housing, with 1 in 5 young family households saying they spend more than 50 – 59% of their income on housing before paying for necessities such as food and other living costs. This kind of over stretching because of increasing accommodation costs could see more and more people rely on high cost short term loans when an unexpected cost occurs. Tiny house popularity is fuelled by the desire to be debt-free.
How Much Do Tiny Houses Cost?
Tiny house costs vary greatly. The joy in these little homes for many is that they are totally customisable, which is why so many people choose to build their own. Tiny house popularity around the world means that kits are now available. Those interested in the movement can buy the shell of the home for around £6,500. It does not include things such as furnishings, layout details, plumbing and electrical.
If you prefer to buy a luxurious tiny home that is totally road legal and feature a full-sized double bedroom, prices can start at £30,000. This is only marginally more than the basic, average house deposit – and you own a fully functioning house. There may be additional costs to consider depending on your intentions, these can include costs of acquiring or renting a piece of land, planning permission, preparing access, electricity, water, drainage and more. It’s important to plan ahead, do as much research as possible and check what is required to ensure there are no unexpected surprises.
Are There Any Negatives?
We have outlined why tiny house popularity is booming for millennials and younger people. However, BBC interviews highlight that most of the people who do own, or are building, a tiny home, want to live in a ‘real’ bigger property in the future. The cost-saving factors allow them to do this, but there is the issue of selling on a tiny home. Typically, they depreciate over time, meaning that you get less money out of the investment than you put in. This can be problematic if you are planning to use the money invested in the tiny home to bolster a house deposit. In turn, there are no returns on renting at all. This means you could still be better off if this is your only alternative. Due to the housing shortage in the UK, it does not seem unrealistic that more and more people will turn to tiny houses as their living solution. What this will do to the property ladder and market is yet unknown, but as tiny house popularity continues to grow, traditional house prices could fall.
Of course, there is also the cost factor and the logistics of finding somewhere to park yourself and all your worldly belongings. Tiny house popularity in the US is booming because it is freer and more flexible, depending on the state, to find somewhere to set up for a while. In the UK, you can be on someone else’s land, subject to regulations. Alternatively, you will have to pay to rent a space or buy some land, but this might defeat the mobility appeal which is another big factor for tiny house popularity.
The tiny house movement is not for everyone, especially if you are a slightly bigger family who feel you need more space. Unfortunately, the alternatives for accommodation are expensive, sometimes leaving people short of funds. Wizzcash are a payday loan lender. We provide quick loans to customers in an emergency; however, we are advocates for protecting your financial security and saving money wherever possible. This means we could help you out when something goes wrong with your house, like your boiler breaks down, but this is subject to a successful application.