They say that sometimes the best things come in small packages... and that's certainly the case with these very special types of homes.
The tiny house movement is taking over the nation... which also happens to be the name of the popular Netflix show that is spreading the tiny home message. Tiny House Nation which celebrates the mini home movement and follows renovation experts as travel across America to show ingenious small dwellings and their creative inhabitants.
There is still no official definition of a tiny home but, generally speaking, it is a small house, typically less than 600 square feet in size. While some are built on foundations, most tiny homes are built on trailers. This style of tiny house is often referred to as a THOW (tiny house on wheels) and allows for freedom of movement so that you can tow your humble abode to wherever your heart desires.
Some of the main reasons why tiny homes are so popular is affordability (tiny homes cost a fraction of what the average home costs), relatively low upkeep costs, and decreased maintenance. Some other reasons include environmental friendliness, simplicity of living, and mobility (if it has wheels).
A few different factors are responsible for the tiny home movement. The 2007/2008 financial crisis led to high unemployment rates and subsequent foreclosures and so some people sought out this more affordable alternative over more expensive, traditional homes.
As well as affordability, people who wanted to reduce their carbon footprint and negative environmental impact found the energy efficiency and joy of living with less that tiny home life offered to be exactly what they were looking for.
Although there is no set standard, typically, tiny houses can be between 100 and 600 square feet - which is small. So be prepared to downsize significantly if you live in a house or apartment.
To ensure that the buyer (and lender) is paying a fair amount for the home, buyers insert an appraisal contingency, which allows the buyer the ability to walk away from the purchase without penalty if the appraisal returns a value lower than a set value (usually the purchase price). Aside from walking away, the buyer can renegotiate for a lower price with the seller, request that their lender make an exception, and approve their loan as if the property had appraised to match the purchase price or make up the difference between the purchase price and appraised value via their own funds. In most cases, if the buyer makes use of the appraisal contingency to walk away, they are likely to receive a complete refund of their earnest money. However, buyers must be cautious and include this in the contract to avoid problems at a later stage.
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Serious about buying a home? Realtors prefer showing homes to buyers with a pre-approval letter. Learn the difference between pre-qualification and pre-approval, the benefits of a pre-approval letter, and why you need one.
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