How do tiny homes make any sense?

Let me state at the outset that I love the idea of tiny homes. In a society still besotted with outsized everything, there is something satisfyingly modest and efficient about these little houses on wheels. They’re cute. They’re snuggly. The pictures of new ones marketed by the Tumbleweed Tiny House Co. look remarkably well finished and appointed, with clean lines and good lighting. They’re adorable–and way too expensive and in oh-so-many ways completely impractical.

What got me going on this line of thought was the email I received a couple of days ago from Tumbleweed, promoting its sale of a 2020 Elm model that apparently (“bank-owned,” the pitch asserts) was repossessed, which is never a good sign. This 26-foot version can be had for $15,000 off its list price, which translates to $770 a month after an $11,000 down-payment–or $983 a month if you can’t come up with a down-payment of more than $1,000. This latter option, it should be pointed out, may be why this particular little house is back on the market.

Before you start day-dreaming about having your every own home for as little as $770 a month, consider some other numbers. The first is that the loan you’d be buying is for 25 years at 7.75% interest. That interest rate is at least 250 basis points higher than a regular mortgage because tiny homes have questionable appreciation value: they’re more like cars, in that respect, than actual real estate. Moreover, it’s questionable whether a tiny home will even last 25 years, which means that when the loan is all paid off you may be left with nothing more than an immoveable shack.

Here are some more numbers: the 26-foot Elm has 204 square feet on the main level, plus an additional 73 square feet in the sleeping loft–which, as the name denotes, is not tall enough for a short person to stand upright. With an after-discount price tag of $99,879, that works out to $489.60 per square foot if you disregard the loft, $360.57 per square foot if you throw in the munchkin footage. Either way, that’s easily twice the cost of building a, you know, real house.

But, you may reply, a tiny home is so much more than a house–it’s portable, a modern version of a nomad’s tent or a gypsy (sorry, Roma) caravan. Which is true enough, provided that you also have a 1-ton truck to pull the thing, since it weighs 12,200 pounds. Add the cost of such a tow vehicle and now you’re looking at a total price tag that would cover virtually any Class C on the market and quite a few Class As–and those come with holding tanks, which tiny homes don’t have, further limiting their functional portability.

The other thing that most Class As and Class Cs have that you won’t find in tiny homes is slideouts, not to mention a helluva lot more storage space. In fact, for all their good looks and typically fawning press, tiny homes are, well, tiny. At eight feet from port to starboard they’re only two feet wider than a standard prison cell, and without the ability to push those walls out you may feel just as confined. Do a virtual tour of one of these units and think about where you could put tools, books, sports equipment or crafts supplies, and you’ll quickly realize that anything that can’t be digitized wouldn’t remain a significant part of your life.

For all that, look for more of these Lilliputian dwellings to pop up at more and more RV parks and trailer courts. Tumbleweed, for one, is also promoting “tiny house hotels” to campground owners, offering bulk discounts of up to $6,000 per unit when ordering five or more. Could be fun to visit, if not so much to live in long-term.

Author: Andy Zipser

A former newspaper reporter who worked at a variety of newspapers, from small community weeklies to The Wall Street Journal, I finished my "normal" work life as the editor of The Guild Reporter, official publication of the union representing newspaper workers. On retiring, I and my wife bought a campground in the Shenandoah Valley and--with the help of our two daughters and their husbands--operated it for eight years, first as a KOA franchisee and then as an independent family-owned RV park. We sold the campground in May, 2021, and live in Staunton, Virginia, a short walk from our grandsons' home.

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