Shrinking Homes: Is the Trend Toward Tiny Houses for Real?

Is the hype about Tiny Homes for real? Although homes today are larger than 40 years ago, there is a trend toward smaller, more sensible spaces and energy efficiency.

Shrinking Homes: Is the Trend Toward Tiny Houses for Real? Close
Page Summary

Shrinking Homes: Is the Trend Toward Tiny Houses for Real?

Posted by Gary Ashton on Thursday, January 10th, 2019 at 10:39am.

Tiny Home Trends Are tiny houses the trend of the future? Are micro apartments even livable? What does the future hold in terms of size and price?

The American family home has increased substantially in size in the past 40 or so years, according to the U.S. Census Bureau.

In that same period of time, the number of persons per household has decreased, so no matter how you look at the statistics, the average space each person in this country occupies, has increased in the years since 1973.

In that year, the average single family home contained just 1,660 square feet. In 2015, the average was 2,687 square feet. In 1973, the average family size was 3.01 in that average home.

Now? The average is down to 2.54 in the average house. The median numbers show similar results, although the numbers are slightly different. The important fact, however, is that home sizes have increased by about 62 percent, no matter which figures are used.

Understanding Tiny Home Trends

While the numbers point out the reality that homes today are larger than the homes of 40 years ago, that average is skewed somewhat by the large suburban ranches and even the "mega mansions" that were built in many growing cities and suburbs across the nation.

The housing crisis of 2008 thru 2011, combined with interest in environmentally friendly living, is the primary cause of smaller living. But will the trend continue?

The raw numbers also fail to address the changes that occurred in those intervening years of urban sprawl. At the same time, there was a reaction forming against conspicuous consumption and ostentatious overbuilding, brought-on in part due to the housing crisis of the "great recession." Shortly thereafter, cities in particular witnessed the birth of live-work spaces that and planned developments with mixed-use zoning, that looked nothing like traditional housing developments. The trend towards higher-density living was becoming mainstream.

Sarah Susanka introduced her concept of "The Not So Big House," promoting the idea that it's not the size of the home, but rather the function of space that should matter to a home's occupants. The innovative young architect was not promoting small, exactly, but she did bring about a new way of thinking. The goal was to fit the home to individual and family needs. The bigger is better mentality began to crack.

Her books, including "Home by Design" and "The Not So Big Life," resonated with the public, and became part of a growing environmental consciousness, which sought to address energy consumption and efficiency as well as lifestyle. It was during those years that green became trendy, and that American consumers began to look at global influences not only for their housing, but for transportation, food production and all other aspects of daily life.

Those transformative years were also characterized by spiraling costs of construction, and the rising price per square foot contributed to a very real sticker shock for new home buyers.

Are Tiny Homes a Realistic Lifestyle Choice?

Various locales were affected in very different ways. In urban centers the steep increases in costs quickly resulted in prices that spiraled out of control. We see the results today in cities like San Francisco, New York and Boston, and the crunch is rapidly spreading across the country.

Newer developments have responded by offering smaller condos and apartments in newly trendy downtown areas, live-work-play spaces that are popular with young professionals as well as retiring baby boomers and younger families.  

Susanka's not so big movement has evolved into an architectural mantra focused on excellent design rather than strict concern with square footage, and the transition toward flexible living space. That as well business options that encourage telecommuting and flex-time arrangements will continue to shape the development of contemporary living spaces.

They are definitely cute; they are fascinating, and they have gained a following. Whether or not it's a realistic option depends on how much space a person needs to feel comfortable.

Why Mortgage Lenders Don’t Like Tiny Homes

While “Tiny Homes” are more popular among a wide variety of people now than ever before, there is one group of people that do not particularly like them--mortgage lenders. Why? Consider these points.

  • Most mortgage lenders have a minimum lending amount--which is usually higher than a tiny home would cost.
  • The tiny homes are often crafted using unique materials, and may not have proven durability.
  • Since tiny homes are small, they can be moved, so they aren’t “built-in-the-ground” homes and are more compatible with mobile homes.

Because of these issues, many people who are looking at a tiny home have chosen to utilize an RV loan or personal lending rather than a traditional mortgage. So before you fall in love with a tiny home, it is important to consider that mortgage lenders often avoid lending on these properties.

Is there a Future For Tiny Homes?

There is little doubt that real estate prices will continue to climb on average over the next decade. It is very possible that as concern with the environment and with quality of life continue to grow, houses will grow smaller once again. If that is the case, other trends are sure to emerge to create new living environments. They may be substantially different from what we typically think of as home today.

These are exciting times. One thing is certain -- just as families continue to change, and family structure evolves, the family home will survive and thrive, but its future size and shape may be very different.


Gary Ashton

The Ashton Real Estate Group of RE/MAX Advantage

The #1 RE/MAX team in the World!

Leave a Comment