Are Tiny Homes Expensive?

The list price of the Tumblewood Tiny House ELM is $75,959 without extras (and some extras are quite handy/required, such as a composting toilet, which all-together can take the price above $80,000), whilst Rocky Mountain Tiny House say that their 34 foot long trailer builds will be “$70-100k”. Whilst the average American home is $275,000+ (making tiny houses look cheap), you can buy a house which is 2-3x bigger than a tiny house for around $80,000 in some states. Plus standard houses cost $125/square foot, compared to $200-400/square foot for a tiny house. So are tiny houses simply a rip-off which are too expensive for the average joe to own?

Whilst tiny homes do cost more per square foot to build (usually more than double the cost/square foot of a standard house), you can still be a lot better off financially living in a tiny house. It is therefore a myth that a tiny house is ‘too expensive’ for you to own.

This article explores the typical prices and costs of building a tiny house, and also how much better off financially you can be living in a tiny house compared to a standard house. We have written a separate guide on methods of paying for a tiny house, if that is what you are looking for instead.

Typical Tiny House Prices

The basic prices for the various Tumbleweed Tiny House models are as follows (as of February 2019):

• Roanoke 20 footer: $55,738 basic. $58,946 including mini split unit and external steps.
• Roanoke 26 footer: $76,738 basic. $83,904 including second sleeping loft, mini split unit and external steps.
• Cypress 20 footer: $67,738 basic. $71,925 including mini split unit, composting toilet and external steps. This is 132 square foot (12.3 square metres) of floor space.
• Cypress 26 footer: $67,738 basic. $80,925 including second sleeping loft, mini split unit, composting toilet and external steps. This is 175 square foot (16.3 square metres) of floor space.
• Elm 26 footer: $76,738 basic. $84,904 including second sleeping loft, mini split unit, composting toilet and external steps.
• Farallon 26 footer: $76,738 basic. $84,904 including second sleeping loft, mini split unit, composting toilet and external steps.

These do not include propane hook-ups or a tiny house/RV friendly washing machine, but include the mandatory D&H (delivery and paperwork handling) fees. The most expensive Tumbleweed tiny home we could configure was the Cypress 26’ model with a range of upgrades taking it to $104,195 – although (like a car with a range of optional upgrades) this would lead to a top of the range model.

Turning to Rocky Mountain Tiny Houses, they aim to make a basic 128 square foot (11.9 square metre) tiny house for $37,000 but their larger houses with top-of-the-range finishes are over $100,000. Whilst they do not have exact prices (since ever case is different), their general prices are:

• 8’ wide x 16’ long: $13,000 for a shell, or $37,000 for a complete build.
• 8’ wide x 24’ long: $20,000 for a shell, or $65,000 for a complete build.
• 8’ wide x 34’ long: $34,000 for a shell, or $85,500 for a complete build.
• 8’ wide x 20+7’ gooseneck: $72,000 for a complete build.
• 8’ wide x 26+7’ gooseneck: $80,000 for a complete build.
• 8’ wide x 32+7’ gooseneck: $90,000 for a complete build.

The gooseneck builds are where there’s an extra ‘tongue’ to the tiny home, and they attach onto the bed of a truck (instead of the trailer attaching onto the bumper). These lead to extra space being made available compared to standard builds, albeit at an extra price:

Finally, Mitchcraft Tiny Homes list a range of prices for their turnkey (non-custom) tiny homes, ranging from $53,000 for a standard 8×16’ tiny house up to $98,000 for a 8×32’ tiny house. Their gooseneck homes start at $60,000 for a 8x 16+7’ version up to $108,000 for an 8x 32+7’ build.

Tiny House Material/Labor Cost Breakdown

After seeing list prices of fairly standard sized tiny homes being $60,000 – $100,000, the inevitable question is why do they cost so much when they are ultimately so much smaller than a ‘normal house’? And the main answer is that a lot of the material and labor costs that go into a bigger house are also needed just the same for a tiny house (the same sized kitchen, with all the pipework and wood it requires, will cost the same whether it goes into a larger kitchen diner room, or into a tiny house). If anything, a tiny house is more complicated to build because there is less available space – which can drive up labor costs when compared to a bigger house.

Secondly, you might be thinking that a tiny house is just a glorified shed with some pipework and electrics and you could do it yourself for $15,000. Well, that might be true (especially if you spend ages harvesting and reusing materials) – and if you can do it yourself, then great! However the labor cost is naturally missing here. If you do it yourself, you will probably end up spending 750+ hours on the build (compared to 350-700 hours that tiny house builders tend to spend per tiny house).

750 hours at $25/hour is $18,750, meaning your tiny house would have actually cost $33,750. This is still a lot less than some of the list prices we explored above, but naturally tiny house builders also need to pay for a massive range of other costs (rent, employee payroll tax, insurance, website design/hosting etc etc) which will inevitably bump up the cost to $50,000+. In short, if you can build your tiny house yourself (or hire a fairly cheap local contractor) then you are onto a winner. But if you need to pay a third party company to do it, expect it to start costing more.

Having said all that, let’s drill down into the specifics. Typical tiny house material costs from Rocky Mountain Tiny Houses (in Colorado) are:

Item	Cost
Trailer	$5,500.00
Windows	$2,800.00
Front Door	$400.00
French Doors	$1,200.00
Appliances	$3,000.00
Roofing	$800.00
Timber/Wood	$3,000.00
Insulation	$2,800.00
Shower	$400.00
Electrics	$500.00
Plumbing	$500.00
Lights/Fan	$500.00
Composting Toilet	$1,000.00
Flooring	$600.00
Interior Materials	$3,500.00
Finishes	$500.00
Cabinets	$800.00
Screws	$180.00
Total Materials	$27,980.00

So without labor or the myriad of expenses that a company clocks up, the materials alone for a $50,000-$60,000 tiny house is around half the total price at $27,980.

Then there is obviously labor costs, which Rocky Mountain says is $20-30/hour for general contractors up to $60/hour for plumbers and electricians. If you assume the average labor cost for tiny house builders is $25 per hour, and such companies take 500 hours per build, this is $12,500 in labor costs.

So we are now up to $40,480 in base tiny house costs, and remember this is for a more basic build. The bigger and more complex the build, the higher the material and labor costs. On top of the $40,480 base cost, a registered company will have a range of other expenses to pay for:

• Building rent
• Unemployment costs
• Accountancy/financial admin fees
• Business licenses and permits
• Insurance (including professional liability insurance)
• General office and building tools and equipment
• Building fees including utilities
• Website hosting/design
• Cost of vehicles and gas for them

Assuming these only add 15% onto the overall base costs (in reality, it’s probably more), this bumps up our $40,480 cost up to $46,552. On top of this, a company needs to make a profit so that it can continue building awesome tiny houses into the future. Hence the $44-55k price for an 8×20 foot trailer build seems pretty good when everything else is taken into account!

Just in-case you think that the figures above are us using one set of stats out of context, DIY House Building’s’s materials alone came to $19,228 back in 2012, whilst Shedsistence’s stairs cost $381 in materials (in 2017) or closer to $1,461 when labor is included. That’s just for stairs! The short is that the sheer amount of materials that go into a tiny house is not cheap, and then you can more than double the costs if you pay a contractor to build things for you too.

Land Rental Costs

Once you have your tiny house, you then need to consider where it will be based! If you have access to a ‘free’ plot of land (maybe in a family member’s land, or a generous friend’s land) then you are very fortunate and should strongly consider this option. But if you do not have access to free land, the next option main option will be an RV park/campsite facility.

And guess what? Land is not cheap! You will typically pay $35 a night for renting space with utility hook-ups on an RV site, meaning as much as $1,050 per month! All of a sudden, renting an apartment somewhere sounds like it will be less effort (mentally, physically and financially!). But luckily, schemes like Good Sam and Passport America can help to bring down such costs – sometimes to as little as $15 per night ($450 per month).

This is naturally the price for on-grid living (albeit in an RV-type site, not in the middle of a city within walking distance to work!). Land rental costs will obviously be lower for off-grid living, but then access to water/sewerage and electricity became an issue and could start to drive up costs.

So there is a trade-off, but we think it is important to consider land rental costs when you are weighing up whether a tiny house is the right decision for you (both for your lifestyle and finances).

Monthly Costs Of Living In A Tiny Home

We have thrown a lot of figures around so far, and that is because there are naturally multiple scenarios that can lead to you getting your dream tiny house and living in it. Another cost that we have not mentioned yet (sorry!) is the monthly financing cost of your tiny house, assuming you did not buy it outright.

Let’s ignore general scenarios, and look at your typical monthly costs in a few different specific situations:

Situation	House Cost (Over 5 Years)	Land Cost (Over 5 Years)	Monthly Cost	Notes
Buy mid-range pre-built tiny house on finance, rent cheap RV space	$56,613.70	$36,500	$1,551.90	$50,000 house at 5% APR, $20/night RV space
Buy top-range pre-built tiny house on finance, rent expensive RV space	$113,227.40	$63,875	$2,951.71	$100,000 house at 5% APR, $35/night RV space
Buy mid-range pre-built tiny house outright, live off-grid	$50,000.00	$9,125	$985.42	$50,000 house, $5/night for off-grid land somewhere
Build your own tiny house, rent cheap RV space	$25,000.00	$36,500	$1,025.00	$25,000 house, $20/night RV space
Build your own tiny house, rent expensive RV space	$25,000.00	$63,875	$1,481.25	$25,000 house, $35/night RV space
Build your own tiny house, live off-grid	$25,000.00	$9,125	$568.75	$25,000 house, $5/night for off-grid land somewhere
Build your own tiny house (with loan), rent cheap RV space	$28,306.85	$45,625	$1,232.20	$25,000 house at 5% APR, $20/night RV space

We find the above breakdown pretty useful because it covers a few specific scenarios, and the monthly cost will allow you to easily compare this to mortgage or property rental (of a standard sized house). Please note that we have put all figures over 5 years as the ‘pay-off’ comparison… but naturally, once your tiny house has been paid off, you are just down to the land rental charges (if any).

So it is worth considering this angle too. Buying a full-sized house with a 25 year mortgage will see you paying monthly bills for a large chunk of your working life, whilst a tiny house will not!

Tiny House Prices vs Standard House Prices

Comparing tiny houses to standard-sized homes can be tricky because tiny houses (on wheels) can naturally move anywhere in a country, whilst a standard house is fixed. So if the cost of living and land goes up where you live, the benefit of a tiny house is that you can simply move to a cheaper area. You obviously do not have this luxury with a standard house (or tiny house on a foundation).

Having said that, Business Insider has a handy list of the average house prices (and square footage to build a house) in all states, a summary of which is:

• West Virginia: $156,000, or $94/square foot.
• Iowa: $180,000, or $132/square foot.
• Illinois: 236,490, or $149/square foot.
• Florida: $294,900, or $165/square foot.
• Utah: $350,000, or $186/square foot.
• Washington DC: $598,995, or $554/square foot.

If you really want to live in West Virginia or Iowa, and you are not able to build your own tiny house, then a smaller-than-average house in these states would probably work out at a similar monthly cost than buying a pre-built mid-range tiny house. Yes the pay-off time will be longer with a standard house (especially since finance costs tend to increase exponentially the more is borrowed), but a tiny house in these states would be more of a lifestyle (not financial) decision – at least in the first 5-10 years.

But a we mentioned above, the beauty of a THOW is that you can move it anywhere. You can choose to live in Florida for the summer if you like (albeit the on-grid land rental prices might be quite high!), or move off-grid for a few months. You have much more flexibility with a tiny house.

In Conclusion: Myth Or Fact?

We will keep it simple: are tiny houses ‘too expensive’? The short answer is: no! In most cases this is simply a myth:

• Build your own tiny house: myth (that they are too expensive)!
• Buy a mid-range tiny house with cheap land costs: myth.
• Buy a top-of-the-range tiny house with cheap RV land costs, in an expensive state: myth.
• Buy a top-of-the-range tiny house with fairly expensive RV land costs, in a cheaper state: fact. In this one case, a tiny house would not be the ‘right’ financial decision.

But in that last case: very few people would choose to buy a really expensive pre-built tiny house, and then pay for fairly expensive RV land costs (when buying a standard house would work out cheaper). We do not personally know anyone who has done this, so in general we say that it is a myth that tiny houses are too expensive.