Monday, July 13, 2015

The Tiny House Movement - Why I've Moved On

Cypress Model from Tumbleweed Tiny House Company
So I've been following the tiny home movement for a while and have been pretty enamored by it. I even looked into building one here when I moved to rural Ontario. As far as I can tell it turns out to not be as good of an idea as it seems. I think there are a lot of good alternatives, though, that follow the same philosophy.

First, I don't think they're as cheap as they seem. I think the way costs are presented are misleading in two ways. First cost of construction only seems to be weighed against total cost of a mortgage on a standard home. The problem with that is that land is a substantial cost. If you're in an urban area the land is probably the bulk of the value of your house and the building itself is largely irrelevant. If you're in a rural area the land is probably significantly cheaper but still a large sum of money. Wood lots around here seem to start around $10k. Building lots are more. Not a lot but not a little either. Of course, if your house is on wheels this changes things because you can put it wherever you want. But that has problems too. Either you're putting it on someone else's land and should therefore be paying some sort of rent (which adds to the cost not reported) or you're living on public land somewhere which is only quasi-legal if not illegal. I think you'd be lucky to get a Tiny Home that wasn't in some grey zone of the law for under 30k around here. More likely 40k and houses start at 50k (although the average is 130k or so last I checked). Building materials stay the same price but land fluctuates due to location so I imagine the correlation will be similar wherever you go.

Second, the banks won't finance you. A tiny home to a bank is a risky investment. It's new so they're taking a risk. Also any house in the sub 1000 sq ft range in this market is worth very little. It's one thing if you're buying an existing house that size and paying market value but it's another altogether if you're building one and the cost of building may be significantly higher than what the bank would make back if they had to foreclose. So they won't do it. That means you have to have 20-40k in your pocket and I don't know many young people who do and young people are the ones tiny homes are best for because families take up space. With Canada's CMHC program first time buyers can buy special insurance that allows them to pay a very small down payment. Here you could go as low as $5000. So you can wait until you have 20-50k to spend on a tiny home of questionable legality or you can buy when you scrape together $5000. I should note that this is not the same type of financing that caused the housing crash in the US. There are a lot of regulations surrounding CMHC mortgages and default insurance is required.

Third the municipalities often won't allow tiny homes. There is usually a 1000 sq ft minimum on new builds in most municipalities and they won't let you live in a mobile home on your land permanently. The reasoning, I'm told, is that these things often lead to pretty rough ghettos and can hurt neighborhood property values. They may start with happy hippie environmentalist types or young people trying to live within their means but when they sell they tend to attract folks that like to live by their own rules. I'm sure all municipalities like affordable housing but I think they prefer to plan it out themselves. I don't really like the logic but this has happened in a few municipalities around here and it seems as though they are right.

Fourth, you're going to run into problems with things like insurance and taxes, especially if you go the wheeled route. I'm learning that house insurance prices skyrocket whenever your house is out of the ordinary. So while you may save in some areas you'll likely loose in others or not be able to get insurance at all. In any case it's going to be an uphill battle.

Fifth, while I think we should all strive to use less resources and take up less space a tiny home may not be all it's cracked up to be - especially where it gets really cold in the winter. I think where tiny homes really shine is where the climate allows you to do things comfortably outside most of the year - places where it never gets much below freezing. If you need space, just go outside. The only place in Canada like that is coastal BC. The more I think about it the more I think 500 sq feet to 1000 sq feet is the sweet spot and there are actually a lot of houses in that range already around. I think the average in Canada is like 2300 sq ft right now. So small, but not tiny. There are people who for sure can get along with a loft to sleep in and a little living room/kitchen area. But that's pretty sparse. If there are two of you then you need to be able to get some alone time so you'll want to at least have one separate room with a proper door - not just a sleeping loft. If, for example, wife wants to read and husband wants to play guitar then you will want a wall between you two. If you have kids then you need at least one more room. I don't think anyone needs big bedrooms but privacy is important - for kids too. You don't want mixed gender children sharing rooms so you could end up with the need for three bedrooms. If you're a professional perhaps you work from home some times or maybe all the time. In that case you'll need a little office space. Also I feel a lot of tiny homes are lacking in shop space. I know not a lot of people are handy but tiny home people seem to value being handy. In warm climates you can be handy outside but when it gets cold you need to come in. A garage or a little shop space seems to be necessary. I've plotted all this stuff out in the past - it brings you up to 500-1000 sq ft. I can't imagine having a fight with a spouse in a space smaller than 500 sq ft in January in Ontario.

That said, there are a lot of exciting existing houses of about this size that are quite affordable. Just about any small cottage is about that size, Canada's veterans houses are that size, many older rural houses are this size, there is the ubiquitous Ontario Cottage, and living on a boat is an interesting option.

Typical Vetran House in Canada
Canada's veteran houses are a favorite of mine. There are a few different sizes and floor plans out there - I think six - and they're built very well. The story goes that during WW2 the military needed houses for the soldiers (PMQ's) but they also wanted to help soldiers out after the war and knew they wouldn't need as many after the war. So they designed these PMQ's to be able to be taken apart and reassembled (read: built really solid). That way after the war soldiers could apply for a house and put it on a lot. The result is that all over Canada there are these little Cape Cod style houses that are built REALLY well. They're aging and small so they're cheap but the layout is fabulous, they'll last forever, and they're worth investing in. Just a really good utilitarian little house. I lived in one when I was a student and was REALLY impressed with the build quality and efficient layout. Better than a lot of new construction. The only thing I felt mine was lacking was a good dining area for larger get-togethers. We only had space for a round family sized kitchen table. There are some companies out there that are converting them to high efficiency houses too. Apparently they lend themselves very well to this.
Typical Gothic Style Ontario Cottage
The Ontario Cottage (here is another link with other cottages and many pictures) is another favorite. Aside from the big farm houses that housed workers AND big farm families, most old country houses were quite small and efficiently laid out. They were built by practical people who didn't have a lot of money lying around. Specifically there is the Ontario Cottage. This is not the cottage as we understand it today but was what sparked the cottaging movement. People then called cotters lived in them - I believe that just meant working people - and so they were just simple houses for simple families. They are two levels, rectangular, with a high peaked roof, and a dormer on the front and back that is very sharp, and a chimney on both ends. Technically it's "Gothic architecture" but really it's just a simple house with a high angled roof. I don't see many that have not had large additions added on but if you could find a standard one you could probably have it rather affordably. There were two bedrooms upstairs with grates in the floor to let heat rise from the wood fires. I believe downstairs was divided into two or three rooms - a kitchen, sitting room, and dining room. The walls are very thick and so decent enough insulation. You could and probably should put some of that blow-in insulation, though. Many are brick but you can also find stone ones that seem to have walls about 1.5-2 feet thick. A modern wood stove wood keep these houses designed for wood heat quite toasty. I love wood heat because it's renewable, carbon neutral, and just nice. I think they're usually about 800 sq ft and you'd not only have a nice efficient little space but a piece of Ontario heritage.

Nonsuch 30 Layout
Another option that I am intrigued by is living on a boat. I don't think this would work for a family but for a single or a couple it could be a good alternative. Depending on design you could go $10-100k for a good live-aboard boat.  Dock fees can be quite affordable compared to rent depending where you are. And this way you combine your hobby with your house, if you're into boats like me, and so whatever work you put into your house goes into your hobby and vice-versa. It's an efficient situation. In the winter you could try living aboard on the hard (land) or you can leave your boat in the water and install a bubbler to keep the ice at bay. Of course you could also go south. It's a small space to heat and there are lots of good options there. It's an affordable way to live at the waterfront. And when you go on vacation - no packing! You just take your house with you.

As I said, I was pretty excited with the tiny home movement but I don't think it's here to stay. Not in Canada anyway. I like the philosophy but it's only going to work for a few people and they're not doing anything new. Many have lived in vans and camp trailers in the past. Tiny homes are for the most part just a re-hashing of that combined with people who want to downsize their lives. Houses are most certainly, in my opinion, too big and too inefficient these days. But there are a lot of good existing homes in the 500-1000 square foot range and that's not too much of a stretch for a family to live in. And in the end I doubt it's that much more expensive.

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