Are tiny houses worth the no mortgage loan?

I've been keeping tabs on the tiny house movement for years. I'm not ashamed to admit I've been stalking Pinterest and Google, ogling at the assortment of delightful bungalows. My favorites are those fashioned from a hodgepodge of materials, but I've seen some rather impressive use of shipping containers, derelict vans, old galvanize, and pieces of restored wood. I also watch TV shows where homeowners share their construction experiences and decisions to live the tiny house lifestyle. And although I know they can't hear me, I still shout at their backs, "I want one too!" as they show off their hobbit bathrooms.

Most of all I watch with admiration as people slim their existence down to 12 personal items, and move into a home as small as 500 square feet. To some others, this move may look like total insanity, but those making the shift believe it's the most freeing thing that they could do. They believe they are ridding themselves of the unnecessary trappings that weigh heavily on their lives and their pockets.

So who is right, and who is insane? Are most of us with our homes over 1,800 square feet, the voice of reason and a sound mind, or is the tiny-home crowd, with no clutter and no mortgage loan, the ones who should be calling us coo-coo?

So, I decided to obtain information to weigh some pros and cons of living in a tiny home vs a traditional house, in terms of cost and comfort, as I wanted a more realistic view of this new wave of suburban living. What I found was unexpected.

COST:
From my research, I discovered the average mortgage loan in the US runs from $250,000 to $375,000, with a monthly repayment of approximately $1,100. Information on the mortgage site, thebalance.com shows that in 2019, the median mortgage payment made by US homeowners is $1,030. These mortgage payments would be payable for an average of 30 years.

So, the conventional house weighs in as large loan for construction or purchase and large monthly loan repayments.

Now let's compare the cost of a traditional house to the average cost to build a 500 square-foot tiny house. This size is considered as one of the larger tiny houses.

The cost to build a traditional house is between $50-$100 per square foot, while the same square footage for a tiny house will cost an average of $300 for construction. It's immediately evident that the cost per square footage for a 500 square foot tiny house is more than double the cost for that same area space of a 'regular sized' house. This means that in some instances, the building cost for a tiny home, despite its small proportions, can surpass the cost to construct a regular size home.

Another factor that was considered is that tiny house builders cannot access loans for their build. To finance their projects, they will sometimes take a personal loan, or, save enough money to build without borrowing. Despite the larger upfront building cost, a tiny house will still result in savings over time, as there is no long term mortgage loan payment.

And now, the tiny house weighs in as possible higher upfront costs, no mortgage loan, no or little personal loan repayment, more cost-friendly option over time.

With that settled, I searched for information on the comfort level of living tiny. I'll share two opposite viewpoints.

COMFORT:
Newlyweds, Collin, and Joanna Gibson moved into their 130 square foot home in Stratford Ontario, after building it for over a year. Things were going well with the couple's ideal living dream until Joanna became pregnant six months into the marriage. They tried going it bravely for a while, but they had to eventually abandon their dream as they realized things could not work out with Joanna's need for more room to move around and the extra space that the baby would need.

Nikitia Moore of Danville, Ga. will be retiring in a few years and she bought her tiny home as part of her plan to live a simpler life. She felt that this option would make her happier, and she is not disappointed. Moore shares that she's gotten rid of bad habits such as overspending, as there's literally no room for her previous shopaholic tendency. She's also appreciating the tranquil environment to pursue projects including soap and lipstick making -things she'd been wanting to do for a very long time. She admitted that living the minimalist lifestyle is one of the better decisions she has ever made.

MY CONCLUSION:
My research does not factor other components of living tiny, such as land access, energy costs, or building permits. Some will be high-cost factors and others will help save quite a lot of money over time, so I'm weighing in on the side of the no mortgage loan payments.

Overall, I'm satisfied that I have a somewhat clearer view of the tiny living movement with its increasing number of house owners. I'm sure that I'll continue to gaze starry-eyed at the beautiful tiny houses I see - although now I know the ins and outs a bit more, there is more insight that I have to consider. Given the opportunity though, I'll probably go the way of a tiny house way one day.

What about you?