How much does a tiny house cost? Explore costs and financing options for your tiny house.
- Your reason for buying a tiny home should drive your financial decisions
- Fully built tiny homes on wheels or a foundation cost between $30,000-$160,000
- Cheaper options include buying plans, a tiny home kit, or a shell and constructing the rest yourself
- As tiny home mortgages may be unavailable, compare personal loans, store project cards, or RV loans to finance
Tired of putting hard-earned cash in your landlord’s pocket? Saving for a house but wondering when you can reasonably buy one? Looking to add space to your current home with a private entrance? If so, you may be making some tiny home plans. You can build your tiny house from scratch or a kit, or buy one move-in ready. So, How much does a tiny house cost? Let’s explore.
Things to Know About Buying A Tiny Home
Before you start, it’s important to be clear on your motives for buying a tiny home.
If you are a renter who wants to own, then prioritize overall monthly cost.
See an opportunity to rent out an Accessory Dwelling Unit (ADU) on your existing property? Calculate your return on investment and check out zoning in your specific neighborhood.
Looking to live and work remotely while traveling to different parts of the country? Make sure your tiny house, plus truck to tow it, fit your budget. Consider renewable energy packages to expand the places you can visit and stay.
Types of Tiny Homes
Tiny houses built on a foundation:
- Require you to own the land they rest upon
- Are charged property taxes
- May be ideal if you’re looking for more space with a separate entrance for a studio, office, she-shed, or rental unit
Tiny houses on wheels:
- Can be easily transported
- May skirt property tax requirements and other minimum dwelling space laws
- Are also built to feel like a traditional home, but ideally meet RV Industry Association standards
How Much Does a Tiny House Cost?
The price tag for a move-in ready home depends on how much time and money you’re willing to invest. Beyond the structure itself, consider other costs.
Tiny Home Plans Plus Building Cost
Plans for tiny homes range from $0-$3000. Builders offer older plans for free, and the upper end includes custom blueprints.
Materials costs vary, but estimate between $25,000-$45,000.
Building a Tiny Home Kit Cost
Home Depot offers tiny home kits from about $4000-$40,000, including the design, instructions, and materials to build the wood or steel framing. You’ll receive checklists to buy and install the remaining finishes.
Building a Tiny Home from Shell Cost
Shells usually include insulation, framing, door, windows, and a roof. They require finishing and range between $10,000-$55,000.
Tiny Home On Wheels Cost
Builders pay to transport their fully finished tiny houses on wheels based on distance. These structures total between $30,000-$160,000.
Consider how much built-in storage you’ll need. Loft beds double the space. Having a step at the right height to allow you to stand while getting dressed in the morning can make a nice difference.
Pre-Built Tiny Home Purchase Costs
If not building on your own lot, you might purchase an existing, pre-owned home along with the land it’s built upon. Look for tiny homes for sale on specialized websites, as most standard home databases don’t list below a minimum 500 square feet.
Absent the land cost, 400 square foot, or smaller, homes run from $35,000-$105,000.
How to Pay For a Tiny House
If the question is, can I get a loan for a tiny house, there are some limited options. Few lenders offer accompanying tiny home mortgages, but other financing options do exist.
Cash
Ideal! Starting your tiny home adventure with a paid-for place reduces stress, whether from slow initial bookings if you’re renting it out, or from meeting additional expenses while living small.
Save
Because of recent interest rate increases, it’s a good time to be a saver. Shop around for the best interest rates and account bonuses.
Borrow
Compare financing options to see which fits best with your goals, savings, and income outlook. Look for fixed annual percentage interest rates (APR) and the ability to refinance with no penalty.
Personal Loan
Banks, credit unions, and the best online lenders offer unsecured, personal loans for any type of purchase. While your tiny home won’t serve as at-risk collateral, you’ll pay for that privilege.
Depending on your income and credit score, current rates for up to $100,000 range from 6.5%-35.99% APR and terms between 7 and 12 years. Current average national rates for a personal loan rest at 21%.
Use a loan calculator to get really clear on how much your monthly payment will total and what you’ll pay over the life of the loan.
Builder or Store Financing
Home Depot offers a Project Loan card that gives you six months to purchase every item you need, up to $55,000. The loan then becomes fixed-rate, with set monthly payments. Interest payments depend on the loan length: the 66 month APR currently sits at 7.42%, whereas at 114 months, it’s 19.96%.
Tiny home builders may self-finance or partner with a lender to offer financing.
RV Loan
You might qualify for an RV Loan if your tiny home sits on wheels and meets RV Industry Association criteria. Interest rates range from 7.5%-11%, available in 10-20 year terms.
Tiny homes on wheels have tended to lose value over time, possibly leaving your longer loan under water should you need to sell. As the number of buyers continues to grow, though, when you are ready to place your tiny home for sale its value may hold up better than in the past.
Home Mortgage
Shop around to make sure your tiny home on a foundation doesn’t qualify for a secured first mortgage. Some institutions’ minimum amount loaned goes down to $50,000, but most start around $100,000. FHA loans cannot be used for less than 400 square feet, whereas non-FHA loans have no minimum home size.
While a few lending companies bill their tiny house financing as a mortgage, most are offering you an unsecured loan, packaged to appeal to buyers in this new market.
Home Equity Loan or Line of Credit
If you’re buying a tiny home in addition to your standard house, you could consider a home equity loan or line of credit. These tap any equity in your primary dwelling, and you secure the new loan with your house.
How Much of a Down Payment Do I Need for a Tiny House?
If you are able to find a secured RV loan, most will require 10%-20% down. Other non-mortgage financing options don’t require a down payment.
Frequently Asked Questions
How much would a monthly payment be on a tiny home?
For a 7-year, unsecured loan on a $75,000 house, at 21% APR, the payment would be $1710.
A 15-year RV loan on a $75,000 house after 20% down, at 8.5% APR, would be $591.
Are tiny homes hard to finance?
Mortgage standards often exclude tiny homes so consider a personal loan, an RV loan or using your savings and paying yourself back. Market expansion may help tiny homes gain recognition as suitable collateral, so prioritize a secured loan with its lower rates where available.
Can you finance a tiny house from Home Depot?
You might build your Home Depot tiny home with its Project Loan card that locks in an interest rate and monthly payments. Rates vary depending on the length of your loan for the outlet’s tiny home kits that give you a starting place to build.
To arrive at the price ranges in this article, a number of providers and cost databases were surveyed on national and local levels. All averaged figures were correct at the time of publication and may be subject to change. Interest rates are current per date of publishing and depend on credit score and other factors.
