Most Millennials Would Consider Buying a Tiny Home. Should You?
- With home prices soaring, now's a good time to consider a tiny house.
- A tiny house tends to be more affordable, but the trade-off in lack of space is worth considering before you buy.
There are pros and cons to going this route.
These days, younger buyers are struggling to break into the housing market. Sky-high home prices and rising mortgage rates are pricing millennial buyers out left and right, and until real estate inventory picks up in a meaningful way, younger buyers might have no choice but to keep renting.
That's problematic, though, because when you rent a home, you don't get to build equity in an asset you own. Instead, your landlord gets to collect your rent payments and use them to pay off their mortgage.
If you're eager to buy a home but can't afford most of what's out there today, it may be time to consider a tiny house. In a recent survey by ComfyLiving, 63% of millennials said they'd consider buying a tiny house. But is that a smart move for you?
The upside of buying a tiny home
The cost of a tiny home can vary based on your location and the specifics of the property itself. But generally speaking, tiny homes cost a lot less than conventional ones. In fact, ComfyLiving reports that monthly housing expenses among those owning tiny homes can be as low as $600. That could amount to serious savings and give you more wiggle room to cover non-housing expenses.
Also, if you buy a tiny home, you might manage to do so outright, without needing a mortgage. ComfyLiving reports that 68% of those living in tiny houses don't have a home loan to repay.
The downside of buying a tiny home
Owning a tiny home could mean spending a lot less on housing. And if you're able to buy one outright, it means not having to worry about qualifying for a mortgage or paying a lot of interest to finance a home purchase.
But there's a big downside to buying a tiny home -- having to live in a tiny home. According to ComfyLiving, the average tiny house is between 100 and 400 square feet, and while the latter end of that range may be doable, you might struggle if you're confined to a mere 100 square feet of living space. (Even studio apartments in big cities like New York tend to be bigger than that.)
A tiny home might also not work well for you if your job is 100% remote. It's one thing to spend many hours a week in a home office, but it's another thing to have to stare at the same exact walls all day long, whether or not you're working.
What's more, if you're hoping to raise a family, you might struggle sharing such a small living space. And you might end up spending extra money to outfit your home with appliances. Standard-sized appliances often won't fit into a tiny home, and you may need to pay up for custom ones.
Should you buy a tiny home?
A tiny home could make it possible to own your own place without spending a fortune. But tiny homes aren't for everyone. If you're not sure how well you'll do with limited space, consider renting a studio apartment for a few weeks and seeing how well you fare. That way, you can decide whether that lifestyle is doable for you before committing money to a tiny home purchase.
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