Americans are turning to tiny homes and portable living spaces to combat mortgage rates and sky-high real estate prices.
As the owner of Companies That Buy Houses, real estate agent Riley Annen said she believes the trend is not just a passing fancy but a lifestyle shift driven by multiple factors.
“With housing prices soaring and incomes struggling to keep pace, it’s no wonder that people are turning to more affordable options. Tiny homes offer a solution that’s not just budget-friendly but also incredibly charming,” she told Fox News Digital.
But it’s more than economics, Annen stressed. It’s “a cultural movement” where people are showing an increased interest in simplicity and sustainability.
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“There’s something incredibly freeing about downsizing and living with less. And the idea of being able to pick up and move your home wherever you please? It’s downright liberating,” she added.
The global tiny homes market is projected to grow by $4.82 billion at an estimated compound annual growth rate of 5.37% between 2023 and 2028, a market research report produced by Technavio indicated. What’s more, it noted the adoption and purchase of these homes are in “high demand” in the U.S.
Last week, a 23-year-old Los Angeles-based TikToker went viral after he purchased a foldable house from Amazon.
“I just bought a house on Amazon. I didn’t even think twice about it,” Jeffrey Bryant said as he unboxed the house for his audience.
The house has fold-out walls and ceilings that convert into a kitchenette, bedroom and living area that measures 16.5 feet by 20 feet. After taxes, it cost around $26,000. It even includes a built-in toilet and shower, though the Tiktoker had yet to do plumbing and electric work at the time, which is likely to drive up the price.
The man also plans to purchase the land the house sits on to convert it into a rental Airbnb unit.
“As a person of color and a Gen Z, I want to inspire others to make wise decisions with their money. People my age are told that we can’t afford to purchase homes, but I’m proof that it is possible,” he said.
The young social media influencer will likely save major cash in Los Angeles, one of the most expensive cities for housing in the United States. In December, Los Angeles homes were selling at a median price of $957,000 – 133% higher than the national average, according to Redfin. Home prices in the U.S. were selling at a median price of $402,045.
Many other Americans on social media have documented their journey of moving into or purchasing tiny homes and movable real estate, also known as accessory dwelling units (ADUs), which can be custom-built or sold as is by companies like Home Depot and Walmart.
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TikToker openhouseaustin revealed she financed an $89,000 tiny home with a down payment R.V. loan. The price included delivery, tie-down, a small deck, fridge, microwave, stove, washer and dryer and more. The 1-bed, 1-bath house is 399 square feet and includes a loft.
“We bring in about 3,500 a month, which pays my entire mortgage,” the social media account said.
Luxury tiny homes have also become more commonplace and cropped up around the United States.
In 2023, South Park Cottages, which is located just 15 minutes from Atlanta, Georgia, became the first developed Black-owned tiny home community in the country.
The homes have finished gardens, large ceilings and communal gazebo areas for the neighborhood. While the average price of a home in Georgia was around $350,000 in December, these cottages cost between $180,000 and $230,000.
But TikToker Megan Leija noted there are hidden costs buyers should be wary of when considering a tiny home.
She noted that one should consider delivery and installation as homeowners must use adequate freight haulers to handle the house load and place it using blocking and leveling. The house must also be placed on a solid foundation to avoid the risk of huge costs down the line. In addition, the property may need skirting, steps and utility hookups added.
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Some Americans are even converting sheds and R.V.s into potential living spaces.
One trend on TikTok shows women turning old sheds into salons and art studios in hopes of furthering their business.
Last fall, Tiktoker Keshhh found her “dream shed” and converted the small 10×20 garden space into a room for her photography. She revealed the entire process took her only 96 hours after she struggled to pay the high cost of commercial studio rent and could no longer justify renewing the lease.
Other TikTokers are showing off their lives on the road, decorating trailers and other large automobiles and working remotely as they travel from coast to coast.
One account, Project Van Life, documented a family of five living in an R.V. and moving across the U.S. over the last two years.
“We pretty much have the same comforts that you would have in a traditional home,” one of the family members, Jessica, said in a video.
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The camper includes a full-size bathroom, a built-in washer and a dryer. There is also one full bedroom and another bunk bedroom with a loft where all three children sleep.
Freddie Mac’s latest Primary Mortgage Market Survey showed that the average rate for the benchmark 30-year fixed mortgage increased to 6.64% this week, up from 6.63% last week. The 30-year average rate was 6.12% a year ago. At the same time, the rate on the 15-year fixed mortgage edged lower, averaging 5.9% after coming in last week at 5.94%.
Many would-be buyers and sellers are waiting on the sidelines for rates to come down. The latest Fannie Mae national housing survey found an overwhelming majority believe it is best to hold off on making a move until rates come down, with only 17% saying in January it was a good time to buy a home – near a historic low.
Peter Evering, a business development manager at Utopia Property Management in downtown San Diego, told Fox News Digital that while he would like to believe the rise in tiny and portable home sales is driven by design and environmental considerations, that is clearly not the case.
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“This is ultimately driven by economic reasons, the biggest one being the double whammy of rising prices and tight inventory. This mainly affects the younger strata of would-be buyers, who are increasingly being outpriced in many markets,” he said.
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