Huge Prices or Tiny Houses?

House prices! Just when you think that surely they can’t go up anymore, they go up! The Australian housing market remains red hot, and increasingly properties are going for well over asking price, as many first time home buyers get blown out of the water by those with bigger budgets.

Australian house prices are rising at the fastest rate in 32 years. Sydney and Melbourne property markets have already bounced back to full recovery from the short-lived COVID downturn. A boost in so-called ‘tree changers’ - lured to regional areas following restrictions - means that regional areas are also experiencing massive price increases.

So if you are a hopeful home buyer, and find that with every day that passes, your hard-earned savings and finance approval will buy you fewer bricks, then perhaps it is time to consider the mighty ‘Tiny House’.

Tiny House

Unless you have been living in a cave you will no doubt have heard of Tiny Houses. The Australian Tiny House Association defines a Tiny House as a “Tiny moveable dwelling up to 50m2 that is suitable for residential use”.  Not to be confused with a caravan or RV, the Tiny House resembles a conventional albeit very small house and is built on a wheeled trailer.  

The Costs and Benefits:

The Tiny House Movement encourages people to downsize their living space and by extension their possessions, and enjoy the massively reduced cost of home ownership. More than this, by being efficient and minimalist, many advocates believe it is a recipe for increased happiness!   Whilst this may vary according to each individual, what is not debatable are the benefits of having no or very little mortgage. With prices from 10-100K, many can purchase or build their own Tiny House with their deposit alone!  More time, less work, and the promise of being a little more mobile. Sounds too good to be true!

Privacy and Space

Well, Tiny Houses are by definition very small. As such, if you are not a single occupant, then you will be in very close quarters with your significant other and or children/pets.  If privacy is your thing, then a tiny dwelling might not be!

Parking: Finding Land

Another significant, potentially make-or-break issue is land. You, of course, need to be able to put your tiny home somewhere. Whilst in other countries such as the United States, Tiny Houses are widely accepted and accommodated for, the case is less so in Australia. Council laws regarding what you can and can't do on land are strict. And in most cases, you can’t simply buy some land and park your downsized home on it.  This is because a Tiny House is classified in Australian law as a caravan.  This matters as then you fall within the rules and regulations that would apply to caravans, which have to be certain heights, widths, and be road worthy.  On the flip side, if you have a residential dwelling where you have access to stay (like your parents) then you can legally park a caravan on that dwelling and reside on it in some states. One way or the other, it is essential to check the specific regulations in your council area


Whilst it’s great that your new home will be considerably cheaper to buy and run, it is unlikely that you will be approved for conventional finance or first home buyers and builders grants.  This means that you will need to be prepared to fund the purchase yourself.
The Bottom Line:

This short article raises some of the things to consider when buying a tiny home versus the classic house. Like many things in life, the great benefits often come packaged with considerable obstacles to overcome. However, for those with the aptitude and determination for this way of life, it really can be life changing.

Written by Ben Saravia,  

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