Couldn't find a pre-existing thread. Mods feel free to move if I missed it.

 

West Texas Town Finds ‘Tiny House’ Crowd a Bit Too Earthy

Luring eco-conscious builders of 120-square-foot homes seemed like a great idea until plans for yurts, straw dwellings popped up; no anarchists, please

 

SPUR, Texas—Nearly two years ago, this town of cotton farmers and cattle ranchers in the rolling plains of West Texas declared itself the tiny house capital of America.

 

The hope was to reverse a long population decline by luring devotees of the growing movement of eco-conscious, do-it-yourself builders who like to live in very small houses. Town officials thought their official proclamation and elimination of nearly all building restrictions would attract the kind of adorable abodes featured on television shows like HGTV’s “Tiny House Hunters.”

 

http://www.wsj.com/articles/west-texas-town-finds-tiny-house-crowd-a-bit-too-earthy-1465867332?cx_navSource=cx_picks&cx_tag=poptarget&cx_artPos=3

This company has recently moved a model tiny house to the marina on KY 8 just east of Bellevue, KY.

http://wheellifehomes.com

 

The house can be seen on their facebook page:

Here are some tiny houses I saw for sale in Nashville recently:

 

 

 

 

 

 

 

Buy a friggin trailer.

Tiny houses are like artisanal trailers.

I can't believe they get $95,000 for that house. There can't be any more than $20,000 worth of materials. It doesn't appear to come with land, either, which would possibly make that a reasonable price.

Yeah, but when does any residence reflect the raw material cost? That's now how real estate has ever been  valued. As much as 2/3 of the cost of a small residence or construction project can be design and labor. That's all rolled into these. Not saying I think $95k is a good price, but if there's $20k in materials in each of those then expecting it to sell for anything less than twice that is expecting a business to give it away or lose money on it. That isn't how it works.

I think the 2/3 rate is a bit high, but even using that number the overhead and profit for whoever is building/selling these is probably coming in somewhere around 60%. 10% is pretty standard, I think the other 50% is the "artisanal" adjustment.

 

And it isn't really "real estate" since there's seemingly no land/location included in the price.

I deal with construction numbers and design fees on a daily basis. But what do I know?

 

This cost would cover design fees, builder's fees, all labor involved, the cost and profit margin for the manufacturer of each special component, the profit and overhead of the company selling them, the premium associated with hiring people who are actually willing to work on these (since many aren't), etc.

 

You're also covering what would traditionally be a realtor's fee since the manufacturer is the one selling them. They have to factor in that marketing cost in the price since you don't pay an additional fee above and beyond the cost of the home.

 

Look up the costs of a brand new trailer or nice camper. They're really no different than those and in some cases quite a bit cheaper.

I deal with construction numbers on a daily basis. But what do I know?

 

So do I, which is why I said $95k is way too much for that home. 50% of that price is profit. They are sold at prices like any other commodity - whatever people are willing to pay for them is what they go for, but it is apparently a good business to get into.

 

As for trailer, a comparably sized 5th wheel trailer runs about $30,000 on the high end.  Here's a "tiny house" sized camper at Tom Raper for $18k:

 

http://www.tomraper.com/new-travel-trailer-rvs/2016-cruiser-rv-fun-finder-214wsd-1206049

 

Getting your tiny house at Tom Raper instead of an artisinal Nashville tiny house showroom is sort of like getting your fried chicken at Richie's instead of the Eagle. You can get a lot more bang for your buck with the 5th wheel, but your friends won't think you are hip.

Except what you just showed is mass manufactured and every component is cheaply done. That trailer you linked to isn't on the same design level or construction quality level as most tiny houses. Part of the tiny house mentality is that everything is very custom and therefore is more catered to a very specific type of individual. That trailer is not. If you find trailers that are then you start getting into the same price range.

 

And do you REALLY believe there's room for 50% profit in this market? If there was you'd see a serious amount of people moving from whatever they're building to building these. But there just isn't.

Except what you just showed is mass manufactured and every component is cheaply done. That trailer you linked to isn't on the same design level or construction quality level as most tiny houses. Part of the tiny house mentality is that everything is very custom and therefore is more catered to a very specific type of individual. That trailer is not. If you find trailers that are then you start getting into the same price range.

 

And do you REALLY believe there's room for 50% profit in this market? If there was you'd see a serious amount of people moving from whatever they're building to building these. But there just isn't.

 

I think it's a niche market at this point, and probably will remain one (if not a trend that dies off entirely at some point). I don't think we'll ever see traditional homebuilders and contractors switch over because there's not enough volume. I think being a niche market is why the profit margins are so high, not unlike any other craft or artisan product.

The tiny house "movement" is a sham because the supposed motivation for them is a lack of money, but then people are building these luxury contraptions that you can't even get a loan for.  Getting a loan for an $80k tiny house would be like getting a loan on an $80k RV -- you'd still need a down payment and you'd be paying fairly high interest.  The resale value of RV's is notoriously low (drop in value faster than a car or truck), and it's safe to assume that you won't be able to give away one of these tiny homes in five years. 

 

If you really want to save money, outfit an old van with a mattress and get a gym membership. There is obviously a stigma surrounding living in a "van down by the river", though. 

Interesting article. Not all motivations are the result of saving money, as we see here within Portland's limited growth boundaries.

 

http://www.nytimes.com/2016/10/06/style/portland-affordable-housing-solutions-tiny-homes.html?_r=0

Mother (mommy blogger?) reflects on raising three children in an 800 sq-foot Manhattan apartment:

https://www.washingtonpost.com/news/parenting/wp/2016/09/26/little-space-large-life-why-we-live-in-a-teeny-apartment-with-three-children/?tid=a_inl-amp

 

The big problem with the tiny house phenomenon is that the buyer assumes that their life situation isn't going to change much in the next 2-5 years.  But if it does, then they're stuck getting into the traditional rental or home buying market with unsecured debt on a luxury tiny home that nobody wants.  Instead of being upside-down on a real house, they're upside-down on a box on a trailer!  So it's easy to envision a scenario in which tiny house ex-pats find themselves worse off than those who just paid high rent.

 

 

I wouldn't mind living in a tiny home. But in an area that has strong thunder storms or Tornado's. One good gush of wind would knock it over or worse.

 

Shipping container homes has sparked my interest as well.

Weird. They don't look like they'd be worth anywhere near $95k, even with high quality materials and craftsmanship. It just doesn't seem worth it to me and I'm sure most people feel the same way. They're way too small, even compared to trailers. The only people I can see buying these are wealthy individuals who would use them for weekend camping trips. A bathroom featuring a shower, toilet and sink and a semi-functional kitchen that you could actually store food and prep meals in, alone, would each take up half the square footage of these things.

 

Really curious to see more pictures of the inside.

$95K is way too much. But $950.00 sounds more like it.

 

http://robgreenfield.tv/theteenygreenyupdate/

 

http://robgreenfield.tv/theteenygreeny/

I couldn't fit into one of these "tiny" houses, let alone my clothes!

Tiny house for $89k...plus 25 acres of land.  So you could buy this and throw the tiny house on the back of a flatbed truck and take it down to Nashville, then sell the land an come out way ahead. 

https://www.sibcycline.com/Listing/SEI/287495/13750-QUERCUS-GROVE-RD-RISING-SUN-IN-47040

Tiny house for $89k...plus 25 acres of land.  So you could buy this and throw the tiny house on the back of a flatbed truck and take it down to Nashville, then sell the land an come out way ahead. 

https://www.sibcycline.com/Listing/SEI/287495/13750-QUERCUS-GROVE-RD-RISING-SUN-IN-47040

 

Looks like the set of a teen horror movie!

My Twitter feed was ablaze tonight with people discussing how a 464 sq. ft. OTR condo just got listed for $175k.

Tiny house for $89k...plus 25 acres of land.  So you could buy this and throw the tiny house on the back of a flatbed truck and take it down to Nashville, then sell the land an come out way ahead. 

https://www.sibcycline.com/Listing/SEI/287495/13750-QUERCUS-GROVE-RD-RISING-SUN-IN-47040

 

Looks like the set of a teen horror movie!

 

Looks like they swiped some lobby furniture from a HoJo. 

 

My Twitter feed was ablaze tonight with people discussing how a 464 sq. ft. OTR condo just got listed for $175k.

 

One of the three 3CDC studio condos that were on the market for $100k for a year before any of them sold?  I have rooms that size in my house that I haven't walked into in months...seriously!     

https://www.sibcycline.com/Listing/CIN/1513983/1406-Republic-St-301-City-OH-45202

They're going to have trouble with that. I sold my place for $142,500 which is almost identical in square footage but has a lower HOA and is a much more usable layout. These didn't sell because their layouts sucked. There was no wall that wasn't occupied by cabinets, closets, or windows with low sills. There was no possibility for a layout that had both a bed and living area alongside a dining area. You had to forego one of those three which is when studios really limit their marketability.

 

That size unit is more than livable for a single person or a couple who doesn't mind being close to one another at all times. I loved living in my 464 square foot studio and never once wanted more room. But it has to be a smart square footage. Adaptability to fit the three main areas of daily life is critical. Those units on Republic just didn't have that ability.

In no way do i mean to pile on, good luck to them, but I love that there are 20+ pictures with most taken from the same spot spinning around in circles.

 

I'm curious how they wound up with that price. I sold mine (which has a balcony with great views) for $142,500, another studio in my building which was slightly larger closed for, I believe, $149,000, and 3CDC just listed the studio in Parvis for $142,500. There's nothing about the building on Republic that says, "I'm worth 1/6 more than those other guys."

I think condos (and homes) get listed for odd prices some times because the owner insists. For example, when one of the owners in my condo association sold his unit a few months ago, he slapped a pretty high price on it and said, "If it doesn't sell at that price, I'll just rent it out. I'm not lowering it." It worked out OK for him and actually the price got bid up as several people were putting in offers. But the Republic Street situation might be similar. On the other hand, I still have no idea why my unit sat on the market so long and was priced so low when I bought it. I have lived here for 4 years now, and as far as I can tell, it's not haunted.

Well they won't be able to give away these tiny houses on trailers in five years.  There is a huge corollary between this trend and the character of the RV industry for the past 40-50 years.  People buy RV's with starry eyes and after using one 2-3 times it sits in their driveway for ten years.  Or they lose their job and sell the thing for literally 10% of what they bought it for two years earlier, who then sells it for 50% of the price of new, but everybody who steps on the lot wants new, new, new. 

 

I work with this guy who is now about 70 who bought a $50k~ fifth-wheel trailer about three years ago and towed the thing over to work one day so everyone could see it.  He took the winter off and while down in Florida his wife was diagnosed with cancer.  She's still ticking but can't travel anymore and just a week ago he out of nowhere offered to sell me it and the truck to pull it for $30k. 

 

There are an unbelievable amount of factors that can destroy people's costly outside-the-home hobbies for years or even forever. That's how video games and other inside geek stuff marches on.

 

Then there's all those "Free Buicks" from the early 2000s purchased new by seniors that are now almost exclusively driven by teens since nobody is willing to pay for them.

An organization called NEST is renovating a half-dozen Southern-style 1-bedroom shotgun homes in Northside into "Kinda Tiny Homes":

http://www.soapboxmedia.com/devnews/092016-kinda-tiny-houses-NEST.aspx

 

There are at least 1,000 of these sorts of shotgun homes across in the river in the NKY cities, often selling for WAY under $50k.  Here's one just two miles up Spring Grove Ave. from the NEST homes on the Ohio side of the river in super-uncool Elmwood Place for just $20k: https://www.sibcycline.com/Listing/CIN/1514873/5-Spruce-St-Elmwood-Place-OH-45216

 

The whole problem with the tiny house thing is that people without a lot of money in their pockets or on the horizon are unwilling to live in uncool (but not necessarily unsafe) areas of their city or uncool areas of the country (like Ohio).  Being perceived as stylish is fueling these ridiculous mobile tiny homes just as much as the drive to impress people motivates mcmansions. 

 

This 2-bedroom Cape Cod in Cincinnati's Spring Grove Village neighborhood is $30k cheaper than the Nashville tiny homes:

 

https://www.sibcycline.com/Listing/CIN/1517285/4654-Winton-Rd-Spring-Grove-OH-45232

 

As time ticks by I become more and more convinced that Spring Grove Village might take off in the 2020's as Cincinnati's next starter home/yupster mecca.  The thing it's really lacking is a neighborhood business district or that first yupster bar or coffee shop that lets everyone know it's okay to rent or buy a house there. 

^ I think yo could be on to something. I have a relative who lives in Spring Grove Village so I'm down there from time to time and it is packed full of small houses like that one that are move-in ready. There are actually a few corners with some vacant storefronts (like Epworth and Edgewood) that could be just enough space for a bar and/or coffee shop - not unlike what is slowly going on in Price Hill with Bloc Coffee. The difference being Spring Grove Village houses are smaller and in better shape, and the neighborhood seems to be safer. It's also got proximity to Northside for the people who like to go to Northside sometimes but aren't quite 'Northside people.'

 

And of course the benefit a home like that one has over a tiny home is that it comes with land and utilities. Getting land and utility hookups for a tiny house would probably cost as much as that entire move-in ready house.

Sometimes those cheaper houses have some sort of issue you can't see in the photos, like floors that aren't level, or a musty basement, or no insulation in the attic, or whatever.  But in my experience (and I looked at about 6-7 cheap houses this year to buy as rentals) that $70k is right now the point where you can find homes that are move-in ready and don't have more than one mild (I said miid, not mold) issue.  Really the biggest problem with these sorts of houses can be that a Mr. Fix-It either lived in it or rented it out and did all sorts of bizarre modifications. 

 

A friend of a friend and his wife have lived in Spring Grove for 10 years and are moving out of town this year, and broke about even on selling their very inexpensive house.  They complained that there was a bit more drug dealing going on there than they expected and I think that explains why specific homes that sit across from apartment buildings sit on the market for 6+ months at insanely low prices.  But that is still going on in Northside, often right next to renovated houses selling for $250k+.  Yes I have seen a few of those buildings with storefronts right in the middle of Spring Grove and thought the same thing, although starting a place in one of the commercial buildings on Winton Rd. with the visibility might actually make money. 

^Have you ever considered that maybe people are less interested in the amount of space they have but rather the location? It's extremely freeing to have a small space. Larger spaces just encourage buying more junk that a lot of people just flat out don't want to be tempted to buy.

 

The idea that the only thing driving the tiny house movement is the desire to look stylish is asinine. But pretty par for the course from you since you've shown a complete lack of ability to comprehend that others might have different desires and goals in life than you. Some people just want an efficient place to sleep and get ready for their day and then spend the rest of the time enjoying the location in which they live.

The only issue I have with tiny houses is that they're on a chassis, instead of a permanent foundation.  This seems to play havoc with zoning regulations, in most non-rural areas.

 

As noted above, small/tiny houses used to be common.  There was obviously a market for them, or else they wouldn't exist.  But today, if you want to live small, and buy new, you're stuck with either a condo, or one of these small house trailers.

I've seen some newer sub 1000-sq ft. developments around Columbus, but they are residential-only neighborhoods often far from any significant non-auto-oriented-commercial areas that could possibly make the neighborhoods walkable. And they are definitely in uncool parts of the metro.

I've seen some newer sub 1000-sq ft. developments around Columbus, but they are residential-only neighborhoods often far from any significant non-auto-oriented-commercial areas that could possibly make the neighborhoods walkable. And they are definitely in uncool parts of the metro.

 

I imagine that small homes and small condos loosely mirror the auto industry -- compact cars retail for only $1,000 above their cost to manufacture, whereas trucks, SUV's, and luxury sedans net the companies $4,000+ per unit.  There are of course plenty of suckers out there willing to pay interest on a depreciating asset that impresses the easily impressed, so the car companies have been doing just fine.

 

 

 

 

^Have you ever considered that maybe people are less interested in the amount of space they have but rather the location? It's extremely freeing to have a small space. Larger spaces just encourage buying more junk that a lot of people just flat out don't want to be tempted to buy.

 

The idea that the only thing driving the tiny house movement is the desire to look stylish is asinine. But pretty par for the course from you since you've shown a complete lack of ability to comprehend that others might have different desires and goals in life than you. Some people just want an efficient place to sleep and get ready for their day and then spend the rest of the time enjoying the location in which they live.

 

Well as I and others have illustrated, if you want to live cheap these tiny houses are far from the smartest way to do it.  See my above comment -- paying interest on a depreciating asset is completely foolish, and that's what the sale of luxury tiny houses is dependent upon.  And if people really want to save money, they should buy a cheap but real house in an uncool part of flyover country like Cincinnati.  You can fly to a different city for the weekend once per month from Cincinnati for cheaper than living in any of them.  Hell, it's only $500 RT to fly to London right now.   

And, again, you're completely disregarding that location has and always will be the primary focus of real estate. I don't want to live in some lifeless neighborhood that requires me to leave to do anything else. Life is too short to spend it somewhere that doesn't spark any excitement in you, whatever that may be.

 

Could I have saved money when I lived in Cincy by, instead of buying a 450ish square foot studio in OTR, spent 1/2 that amount and gotten an entire house somewhere else? Sure. But it would have required me to sacrifice many of the primary things I'm looking for in a residence.

 

I recently moved to NYC. Could I save a crap ton of money by living outside of the city? Sure. But I'd, again, have to sacrifice everyday in order to do so. Either by not living around the things I enjoy in life or through using more of my time to get to work, get home from work, get to entertainment, see friends, etc.

 

It's not always about the fixed cost of a residence. It's about a lot more than that actually. Nobody buys based purely on the dollar amount of a property. It's the dollar amount of the property in comparison to other properties which meet the other needs that makes tiny houses appealing.

 

Like in the case of my studio in OTR. It was more expensive than hundreds of properties in the "uncool" parts of down. But for what I was looking for it was the second cheapest option in OTR. The first cheapest being a slightly less expensive studio on the ground floor of the building I was living in (that $4.50/month savings on the mortgage wasn't worth it if I had to live on the ground floor). I wasn't cross shopping between OTR and Spring Grove Village because Spring Grove Village couldn't possibly give me the life that I enjoy living.

 

And that's the reason for tiny houses, micro units, etc. They're the cheaper alternative to much more expensive properties that give you all the same qualities as those expensive options except square footage. And for a lot of people that's perfect.

These "structures" along with container housing are a symptom of the market not supplying enough "cool" areas and oversupplying "uncool" ones. Unfortunately, it's much more difficult to create a "cool" area from scratch as compared to buying someone's farm and turning it into a subdivision -- at least it was until banks stopped approving speculative sprawl residential development after 2008.

https://mentertained.com/24-used-school-bus-conversions-youll-love/16/

 

Tiny houses are all the rage right now, so why not build a tiny bus? It’s just as roomy as a tiny house, and more upscale than an RV. Check this one out, it even has cedar shake shingle siding and a nice tin roof. The flower boxes on the outside add to the homey feel, as does the porch light mounted to the side. Also, consider the fact that a well-maintained school bus still has a lot of road life left in it so traveling the highways and byways of America is not a problem. You can explore to your heart’s content and live practically anywhere you wanted. The only give-away that this is a school bus stems from the fact that the front portion is yellow. You can camouflage that bit and you might just fool people into thinking you have a house on wheels. Or, simply leave it and let them marvel at the fact that you have converted an old school bus into your own living space.

 

Shotgun 1-bedroom house renovation in O'Bryonville for $220k...actually a pretty creative rehab that would not be possible if the small house wasn't perched above the Torrence ravine:

 

Look how they took out the central room and put the bedroom and full bathroom in the basement:

 

Worth looking at the full set of photos, especially to see the duel rear balconies:

https://www.sibcycline.com/Listing/CIN/1516745/575-Torrence-Ln-Hyde-Park-OH-45208

 

 

---

 

For $20k, or 1/11th the price of the house shown above, you can live in the same sort of house in Elmwood Place (yes, that is I-75 immediately behind the house):

 

Come on people clean those gutters:

 

Full photo gallery here:

https://www.sibcycline.com/Listing/CIN/1519092/5682-Silver-St-Elmwood-Place-OH-45216

 

Wow... The first one is definitely a little nicer but it's not 11x nicer... What's up with the second floor or attic? It doesn't look tall enough to be a second floor but maybe an attic you could crawl in. They both have windows on the second floor. While they were knocking out all those walls in the first shotgun bungalow, they should have knocked out the ceiling, too.

You can't just knock out the ceiling of a house without beefing up the structure, because the ceiling joists are preventing the roof from pushing the walls apart.  There may also be diagonal members in the attic to keep the roof rafters from sagging, which in houses like this are probably only 2x4s.  You could do it, but you need to install a large ridge beam, which will require one or two posts in the middle of the house, plus adding columns in the gable end walls which would mess up those attic windows (which were probably vents originally, if there was anything at all) and requires a lot of labor and some new footings in the basement. 

 

On top of all that, once you remove the ceiling, and you only have 2x4 or 2x6 rafters, you can't get the required roof insulation without going to very expensive closed-cell spray foam or a combination of spray foam inside and rigid foam on top of the old roof, which requires new roof sheathing and rebuilding all the eaves and soffits.  You also can't do recessed cans in that shallow of a ceiling, especially sloped (down lights for sloped ceilings are bigger than standard remodel cans, usually requiring at least a 2x10 rafter) and each one punches a hole in your thermal envelope. 

Wow. You definitely made an open-shut case for why it's not feasible to knock out the ceiling.

That's why you hire architects :)

For $20k, or 1/11th the price of the house shown above, you can live in the same sort of house in Elmwood Place (yes, that is I-75 immediately behind the house):

Full photo gallery here:

https://www.sibcycline.com/Listing/CIN/1519092/5682-Silver-St-Elmwood-Place-OH-45216

 

An I-75 that will be about 100 foot closer to the rear of the house in a few years (on a wall). I wonder if the Agent is disclosing that information to the prospective buyers?

Shotgun 1-bedroom house renovation in O'Bryonville for $220k...actually a pretty creative rehab that would not be possible if the small house wasn't perched above the Torrence ravine:

 

Before?

 

https://www.google.com/maps/@39.1309653,-84.4629137,3a,75y,326.44h,90.83t/data=!3m6!1e1!3m4!1smjJK9_nJCMznlM2KsYL15g!2e0!7i13312!8i6656

Location, location, location.  Even without I-75, Elmwood Place is still Elmwood Place.  O'Bryonville on the other hand is its own neat little neighborhood to people in the know, and to most others, it's Hyde Park (in fact that little spit of Torrence lane IS Hyde Park).

 

The difficulty we face here in Cincinnati which is for the most part not supply constrained (with some exceptions) is that the low value of existing buildings makes people think they should be able to get new construction for a similar price.  It just doesn't work that way.  The same new car doesn't cost appreciably less here than in San Francisco, despite the huge income and cost of living differences.  Building construction is similar.  While labor may be marginally cheaper here, materials aren't, and they're both still way higher than a building that's had decades to depreciate. 

 

I do think $220K is a bit much, especially since it backs up to Torrence Parkway, but it's a super easy walk to the O'Bryonville business district, and it would be an outstanding house for a single teacher at Summit Country Day School.  There's some 1920s bungalows next to my apartment building just two blocks away that range in value anywhere from $30K to $180K depending on whether they've been remodeled or not.  They're a bit bigger with separate living and dining rooms, and I believe two bedrooms upstairs.  On the other hand the brand new "courtyard houses" built at the end of the street were sold for $750K and up, with similar models by the same developer in Northside selling for half that much.  So it seems like pretty much anything goes here, and again, location, location, location.

A lot of people don't realize how many houses in Hyde Park are complete dumps inside, with nothing being updated since the 1950s.