Contrary to popular belief, the tiny house movement isn’t something that was recently invented. Tiny homes have been around for at least a few decades, with most experts tracing their modern origins back to the 1980s (which is when they first really came to prominence).

However, it’s really been in the past decade or so where the tiny house movement has really come into its own. Back in 2009, the housing bubble popped (or erupted might be a better term), causing millions of people to forego their large (and expensive) houses, in lieu of something a bit smaller (and lighter on the wallet).

Building (or buying) a tiny home doesn’t come without some amount of concern though. For example, did you know that there are numerous hidden costs involved in building a tiny home? There are also quite a bit of legality issues that you must contend with (although this entirely depends on where you plan to build your tiny home). Don’t worry though, below we go into detail regarding everything you’d want to know about building/owning a tiny home.

Before Doing it Yourself, Think About Hiring a Builder

Although DIY is great (and we certainly wouldn’t want to discourage anyone from building their own home), it’s important to consider whether or not you’re actually prepared for the building process (or not).

Lots of people have the idea of building their own tiny home. They take a few months off work, thinking that’s all it will take to get their home finished. Fast forward three months, and the house still isn’t built (or anywhere close to being done), and they’re still not back to work either.

This is one of the main reasons why looking into tiny house builders in your area is a good idea. Not only will they bring their years of construction experience, but you also wouldn’t need to take time off work (and deal with all of the unexpected events that come with any construction project).

The Average Cost of Building a Tiny Home

You might be surprised to learn that building a custom tiny home can cost as little (or as much) as you want. For example, a modest (but very basic) tiny home can cost as little as $10,000. Alternatively, a more extravagant tiny home build can cost over six figures. How much it will cost to build your tiny home depends on a variety of factors, most of which are listed below:

  • The construction/contracting company you choose.
  • The area you want to build your home.
  • If you’re building on a foundation, or doing it on a trailer.
  • Which materials you plan on using (some are obviously more expensive than others).
  • Whether or not you plan on doing any of the work yourself (which could either end up saving you money, or costing you more, depending on how experienced you are in construction).
  • The zoning laws of the state/city/municipality that you plan on building in. Zoning fees, inspection permits, building permits, etc. These can all add significant costs to the overall price of building your tiny home.
  • Zoning laws, fees, and related costs are typically much higher in cities and densely populated areas. This is why a lot of tiny home owners opt to live in more rural areas. The American Tiny House Association has an excellent resource regarding tiny house zoning laws (for each state).

What About Insurance? Will I Qualify for a Mortgage?

During the planning and building phase, it might be easy to forget about purchasing a homeowner’s insurance policy for your tiny home. Sometimes, tiny homes present some particular challenges to insurance companies.

What it really comes down to is whether or not the tiny home is a DIY build, or was built by a professional contractor, as well as if it was built on a solid foundation (or on a trailer – which would add another layer of complexity).

Don’t plan on qualifying for a mortgage. This is one aspect of building/purchasing a tiny home that is oftentimes overlooked by newcomers to the movement. Due to the unique sizing issues of a tiny home (as well as their general low price point), they generally do not qualify for mortgages.

If you’re looking for financing for your build, most tiny home builders/owners use unsecured personal loans to finance their project. As long as you have a decent (or better yet, excellent) credit score, you should be able to find a loan for anywhere from $10,000 to over $100,000 for building your tiny house.

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