Tiny Homes, the Financial Shortcut of Real Estate
Tiny homes have
disadvantages and advantages when compared with traditional real estate, but
one clear benefit is that they are much more financially attainable. Below I
list the ways that moving in the tiny home direction can save you money if you
are interested in becoming a homeowner.
lL Lack of debt.
When
people purpchase property in the traditional real estate world, they are forming
what is usually a 30 year commitment when mortgage is concerned. The ballpark
of 30 years is a long time to commit to anything, let alone monthly monetary
payments. A major advantage of tiny home real estate is that they don’t lead to
much debt. They cost roughly $20,000 to build yourself and $50,000 to have one
built. These prices are much, much lower than traditional housing. Most people
who are legitimately considering a real estate purchase have at least $20,000
saved up for a down payment and start-up costs. Using this money toward a tiny
home would cover much more of the total cost, while still providing a place to
live.
Noticeable: Debt is
a commitment that accrues interest and doesn’t fluctuate if your job or
situation changes. Tiny home real estate offers an option to acquire and own
property quickly, or even immediately.
2. Energy costs.
The
square footage of a house is directly related to monthly energy costs. Because
of this, tiny homes are much more financially viable when energy consumption is
considered. Every type of energy bill that people receive each month would be
decreased substantially. This makes a noticeable difference in your bank
account. It’s always a bonus in 2013 when something can be environmentally
friendly while also saving money.
Noticeable: Being
able to spend money on other interests rather than sky high energy bills is a
major factor for those who support the tiny home movement. Reduced energy costs
equate to more personalized spending.
3. Amount of
possessions.
When
less space is available, there is inherently less room for possessions. While
some view this as a positive and some view it as a negative, financially it is
most definitely a benefit of tiny homes. If you were the owner of a tiny home,
the decreased square footage would require far less furniture. The size would
also limit excessive purchasing, thus keeping money in your pocket.
Noticeable: Many
houses around America are littered with useless and dated possessions. Tiny
homes are unique in that they eliminate potential for excess material objects.
This can save you money, especially in the long run.
The way that America has
operated over the last several decades is that bigger is always better,
particularly in real estate. The success of people is too often judged on the
size of their garage and the number of bathrooms in their house. The American
Dream is being achieved in alternative ways in 2013, and tiny home real estate
is one of those ways. Bigger is not always better, particularly when finances
are concerned.
Tiny homes may be
small, but they’re making a large splash in the pool of American real estate.
Tim Richmond writes about the mortgage industry,
real estate, green building, personal finance and home ownership. He currently
writes for the Native American
mortgage specialists 1st Tribal Lending.
(Old Faithful-Thanks, Dad for moving to a condo!)
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