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The Fallacy Of A Cheap Tiny House

So over the years I have seen many people touting their tiny house as only being a few thousand dollars to build and many crying out in protest over how much some Tiny Houses cost.   While I do think there are many ways to save quite a bit of money during the building process, the fact is Tiny Houses cost money and a good bit of it.

Even though Tiny Houses pale in comparison to the cost of traditional homes, the price tag of a tumbleweed style house or similar often leaves people wondering how they can cost so much.  So I thought I’d break down some key factors that those who claim their house is only a few grand often neglect to mention.

 

istockphoto_5212090_time_is_moneyYour Time:

One of the biggest places that people often don’t assign costs to is time spent on your house; Particularly if you time spent on building your house takes the place of working a normal job.   The fact is that many people don’t have the money to build a tiny house all at once, but they do have time.  So they build it themselves and many spend time sourcing reclaimed materials.  While there absolutely nothing wrong with this, I am taking this approach, you simply cannot say that your time is free.  You have value, your time is valuable, and you are giving it up to build/source in the place of something else.

When it comes to finding reclaimed materials, dumpster diving, checking craigslist every day to find all or some of the materials you need, it takes a huge amount of time.   For those of you who haven’t tried to source materials for an entire house, it can be very hard to understand how much time.  If I were to estimate a figure, I would guess you spend twice the hours spent on building.  Additionally, the ones that do reclaim their materials often have pre-existing social connections that facilitate this that the majority of us simply don’t have.

 

Their Time:

I get a lot of people asking me how to get a tiny house built for them and for many, this is how they want to get to their dream of living in a Tiny House.  For many they don’t have the skills to build a house (though I firmly believe almost anyone can learn)or they have the time to do it.  The fact is that regardless of it being a Tiny House or a McMansion, labor costs to build a home can be anywhere between 40% – 60%.

Now there are some that criticize tiny house builders of charging $50,000 when it costs $25,000 in materials, as building in huge profit margins.  The fact is, if you sit down and really crunch the numbers for what it takes to hire workers, insurance, rent a build site, tools, utilities, and a million other things, I’m surprised that they can eek out a modest living; in fact I don’t know for sure that anyone has been able to have it as their sole job.  Even Jay Schaffer had to expand into books, classes and plans when he first started.

 

Consumables:

15839812-a-close-up-of-a-screw-in-woodSo I am going to cry foul on many people who claim they made their home for only $3-5,000 because at this point in building my Tiny House (only about 1/3 of the way built) I have spent almost $900 on nails, screws, bolts, glue, fasteners, brackets, etc.   There is no way you can get around buying these things because you can’t really reuse nails, screws or glue.  As for brackets and bolts for tie downs, you might be able to reclaim them, but in most examples (not all) I have seen, people simply were cutting corners and not adequately anchoring their houses to the trailers.

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What do we really need?

Before we even start to think about floor plans or how you will store all your stuff in a Tiny House, we first need to get down to the basics.  What do you really need in this life?  It is often a lot less than you think, but I feel it’s also important to point out this isn’t about living without, we aren’t trying to sacrifice things here, we are trying to find the happy medium.  When we understand our needs, we then can determine the form and function of our house.

I have talked before about symbols of happiness, the idea that we purchase things which remind us of happy things, of our hopes and wants, of our dreams, but they do not themselves bring us happiness.  In fact, internally, I think this actually creates inner turmoil because our desires go unmet.  A perfect example is having a desktop or screen saver of a white sands beach, it constantly reminds us of us not being there, and it doesn’t seem healthy.

So what if we were to adopt a lens to view our world through to determine what bring us joy and contentment.  With this new lens we need to do a shift in thinking as well.  We need to know what things to strive for, to know what things we must pursue, but they should be achievable with hard work.  At the same time, we need to be okay with not having things that we will never have and shift focus to the things we do.

I am reminded of a story about a man who sought the wisdom of Buddha.

It is said that the happiest people don’t have everything; they just make the best of everything.  While cute quotes such as this one may be fun, we are beginning to see there is a solid foundation in truth to them.

There have been quite a few studies that show that too much clutter has a very negative impact on our well-being.  Angus Deaton, Ph.D., a renowned economist, and Daniel Kahneman, Ph.D., a Nobel prize-winning psychologist conducted a study where they were able to determine that people who made $75,000 a year were the most happy of any salary range.  They were able to show that above that figure had no bearing on happiness and in fact, it could decrease because additional stress that comes with that job.

Now $75k seems a lot to many, but I would expect that Tiny House people could achieve this same peak happiness at a much lower salary because your money goes further. It isn’t the amount of money here that matters; it is what it affords you that is key.  At $75,000 you can afford all of you life’s basics, you can have good health insurance, a good house, some money to take trips and still save some for a rainy day.  With a Tiny House you remove the housing from the equation, which is equivalent to many people’s 30%-40% of income; in this case $23,000-$30,000.  So if we adjust that $75k we are looking at $45,000 annual salary which is much more achievable.

One way I help people determine what is important to them is propose a scenario.  Imagine you wake up one night from a deep sleep and flames are curling up the walls, your house is on fire.  You look out the window to see your family and pets screaming for you to escape with your life.  What do you grab on your way out of the house, know that all else will be lost?

There are few things in this world that cannot be replaced: those close to you and things that remind you of times with those people are irreplaceable.

Finally the differentiation between wants and needs is a tricky lesson to learn.  We are exposed to a consumer culture that makes it hard for us to even separate these things.   So this part is a gradual process that many of us still find ourselves grappling with.  It has been taught to us from a young age that accumulation of things is better.  The more stuff we have, the better we are.  The psychology of these things cannot be understated; we need to dig deep into ourselves to examine our motivations.

So hopefully this has let you understand a little bit of what truly makes you happy, what to steer clear of in terms of things that we THINK make us happy and help change our thinking to determine our needs and wants.  Once we do this we are prepared to fully determine our true needs and how to arrange our life to live in a Tiny House.


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Embracing Symbols Of Happiness

When I attend Jay’s workshop a few weeks ago I gained an interesting insight from one of many discussions.  It was the concept of how many of us embrace symbols of happiness and that often we do not realize that the things we have actually represent happiness, but don’t bring it.

Take for example a photo of a white sands beach, an island paradise.  We see many people have these types of photos pinned inside dreary cubical or as our computer desktop.  What is this really?  Why are we compelled to hang such a photo in our homes, work, etc?  Subconsciously these are symbols of happiness, but they, themselves don’t bring happiness.  If anything they are reminders of something that is lacking in our lives.

It is an interesting perspective when we evaluate our personal belongings aka stuff, often which we have way too much of.  Here is a video where Jay talks a little about it.

Part Two – Solutions To The Top 5 Barriers Of The Tiny House Movement

This is the second installment of this post, I posted the first part of this here, this is the second part of a post I wrote on the solutions to the top five barriers to living in a Tiny House.

Social Pressures

Social Pressures was something that Lloyd over at Treehugger took issue with because, as he pointed out, much of the rest of the world lives in small houses.  I guess I need to clarify that these pressures I speak about are not on a macro level, but a more micro, person to person, local interaction pressure.  This fact certainly wasn’t lost on me and ironically I had a moment of pause when it came to this article because I know living smaller is pretty status quo for most people.  But ultimately I decided not to go into all that for a few reasons: 94% of my readers are from the United States, an individual will typically get direct social pressure from their friends, family, and those around them, not from someone in another country, finally we are talking about Tiny Houses, not small houses; Building a small house typically can be done within the current legal confinements and are more widely accepted as just being practical, frugal, or a product of density.  Ultimately in the US, Tiny Houses are an extreme and only serve to spark a conversation about how much house and possessions do you really need.

As for dealing with these pressures I think it is very important first have a firm understanding of yourself, from there understanding the issues and engaging in respectful dialogue with opposing view points.  In the end you cannot convince everyone, but knowing yourself, the motivations, the convictions and gaining the support of those close to you can help you manage this.  Most often this is a pretty moot point because those you socialize with are of the like mindset, the rest are often fascinated by how cool your Tiny House is.  Just keep in mind that it isn’t for everyone.

Fear

The final point kind of extends the points from the previous heading, but understanding that to build a Tiny House you must pay a good chunk of change to do it is stressful in some ways.  I guess for me, spending $30,000 in one shot is very stressful and evokes doubts no matter what.  When purchasing my first new car, I remember just before signing the line I had a brief moment of fear hit me, what if I crash the car, what if it’s a lemon, what if, what if what if.  Simply put, for me, spending that sum of money is scary no matter how sure I am, because you are taking the leap.

Things that help with this is to be intentional about what you do, do your homework, think it through, look at ways to mitigate risk.  I always try to put it in perspective, that if I were to live in my Tiny House for 2-3 years, I could walk away after that because I would have broke even when compared to paying rent.

 

What Are your Other Solutions?  Let us know in the comments!

Solutions To The Top 5 Barriers Of The Tiny House Movement

About two weeks ago I wrote a post on the five barriers to living in a Tiny House and it sparked a lot of great discussion and got some coverage around the blog-o-sphere, but I promised to do a follow up post on what might be some possible solutions to those barriers.  So today I wanted to do just that.  This got really lengthy so I have split it in two parts, the next one will go up later this week.

Land

Land is expensive no matter how you slice it, but there are a few things you can consider when looking for land.  If you are willing to live in very rural areas, you can pick up land at a better price, but you trade being close to things and having more employment opportunities.  Since many Tiny Houses are off the grid, you might consider purchasing land that has failed to pass the “perk test” which is way cheaper, but consider the implications down the road.

Many people have found success in parking their Tiny House behind other people’s houses or on a corner of their property in exchange for money or barter of services.  I have seen this particularly resonate with retirees as keeping up a lawn or things that need to be fixed around the house becomes too daunting psychically.  In this case you simply work out an agreement and officially you state that you sleep inside their house, you just happen to park a trailer in the back yard.  Most zoning (but not home owners associations) usually allow for a trailer to be parked out of view of the road as long as it has a market value over a few hundred bucks.  

Next option is cooperative purchasing, co-housing, or intentional community models.  These are a huge topic in and of themselves, but in short, you find a group of like minded individuals that pool their money to purchase some land.

Mobile Home parks, RV parks and campgrounds are the next option, the two big caveats on this is that some places require that an RV or mobile home must be legally designated as such in order to be allowed into the park.  This can good and bad in some ways; you can operate in a box that municipalities know and understand, but also you might be limited by that box.  With Campgrounds you will have to be sure that they don’t have a limit on stays, many do.

 

Loans

Loans are a tricky one; banks inherently want to manage risk, which means they don’t want to step outside the box.  Some people have had luck with securing personal loans, but this option has had limited mileage.  The kicker is if you build a Tumbleweed style house yourself then you are often looking at what is normally 2-3 years worth of rent.

The solution I advocate for is to be self funded, aka save up and pay with cash.  This is not what many people want to hear, but philosophically I feel that it is very much in line with the Tiny House movement.  We have recognized that how our society currently conducts itself isn’t always the best approach.  Part of the philosophy of living in Tiny Houses is to reduce the things you have to remove the clutter and stress from your life.  Entering into a Tiny House without debt is essentially removing stress from your life so you can enjoy it more and focus on what is important.  A Tiny House is not inherently the solution, it is the process and change in living that brings it.  

Realizing that no matter how much I try to convince others that saving up is the solution, many will not heed my advice, there are other ways to get there.  Some people found a low APR credit card (all things relative) and used that to pay for the house, then treated the monthly credit card bills as their mortgage payment.

Some have been able to have family or friends loan them money and they work out a payment schedule.  Some even pay interest to them.  The downside to this is that it can put a strain on relationships and change the dynamic, so proceed with caution.

 

Laws

When it comes to laws you need to make a decision, are you going to abide by them or not and understand that there are very real consequences to both sides.  It is a tricky problem. 

For those who want to be above board on everything, the best advice I can give you is hire a contractor/developer who is sympathetic to your cause.  What you are buying is their expertise and knowledge on how to navigate the codes and permitting process.  They know how to get variances, they speak code enforcement’s language and might even have relationships they can use.  When approach them, make sure that your homework is well done, you should have sample drawings, plans, photos, and copies of sample codes that other municipalities have used to deal with Tiny Houses.

For those who wish to do it under the radar, understand you are technically breaking the law, it could have criminal consequences.  I personally haven’t heard of people getting in trouble, but there is a potential and legally they have the right to pursue criminal charges.

When it comes to skirting the law, there are some things you can do to mitigate the risks.  First off, be a good neighbor, this will go a long ways.  This is because most municipalities are complaint driven, meaning only when code enforcement gets a complaint, do they investigate.  The other thing to add to this is, don’t be obvious.  Have your house be out of sight of the public and keep a low profile.

Next powerful tool to have in the tool box is know the laws, codes and speak the language.  I can’t stress this enough, it take a lot of time and it is a frustrating process, but being legal savvy is very helpful.  For example, if you state your primary dwelling is, in fact, the normal sized house you park your Tiny House behind, this means that you do not live in the Tiny House and it is simply a trailer.   By knowing the system we can exploit it’s weaknesses in a legal manner, much as a shady lawyer would do to get his client off on a technicality.  Basically you want to legally show you live somewhere else, that no one lives in the trailered Tiny House, and that it is a trailer that is compliance with zoning.

The last way to mitigate risks legally is know that many municipalities now use satellite and or aerial photos to do tax assessments.  Essentially they take photos at different times and compare to look for changes in your land.  If they find something has changed, they will often send someone out to check it out.  Usually this is a tax assessor or they just send a letter, but you can usually settle their fears when they see that it is on wheels and you can say that you are storing it here for a week, month, etc. in accordance with zoning laws; at that point pull out a copy of the code and they will generally leave you alone.    Again, knowing the legal speak can get you out of this.

 

The rest will be continued in part two in a few days.   UPDATE:  part two is here


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