Finding Land For a Tiny Home — Land Development Realities

Are you interested in Tiny Home Investing?

Well, I am back after a short lay off and I will be picking up on Tiny Homes today. There are a few types of Tiny Homes that investors can look at to capitalize on the market. The first and most obvious is a stick built or concrete block tiny home. This would be a builder constructed cottage on-site in the traditional way, but smaller in overall sq. ft. The second option is a T.H.O.W., a Tiny Home On Wheels. These start out as structures that are licensed as vehicles and some of them stay that way. These THOW’s are placed in parks on leased sites, either short or long term and stay on their wheels. The other, and most interesting to me as an investor, is a Tiny Home built offsite and then placed on a foundation, making it real property. In this scenario traditional mortgages are an option - FHA, VA or conventional financing.

Stick Built Tiny Homes onsite
THOWS on their wheels
THOWS placed permanently on a foundation
Tiny homes built offsite and placed on foundations

Finding The Land or Lot

There are builders that construct site-built tiny homes and the process is largely the same as building any other home. The key in researching the land is what the county or city building codes allow for such structures. Most local building codes have a minimum square footage requirement and it must be clear that the tiny home being designed is going to comply fully with the Code. In addition, there are state building codes that all municipalities must comply with. The moral of the story is to not assume that the site-built tiny home you are contemplating can be built on just any lot. Do this research carefully and seek professional guidance as needed!

Don’t forget Homeowner Associations (HOA’s) either. Many (most?) HOA’s have much more restrictive covenants that the local building code.

THOW’s On Wheels

If you are looking to buy THOW’s on wheels as a rental investment getting the structure itself is not the real challenge in my research. Finding a park to put it in can be. The explosive growth of Tiny Home living and investing has created a glut of interested parties and a shortage of places to put them. In addition, many RV Parks are set up for transient folks that come and go and do not allow THOW’s to be placed permanently, or even at all.

Tiny Homes On Foundations

Larger cities are on the forefront of making allowances for permanent tiny home living, whether stick-built cottages, THOW’s converted to foundations, or Tiny Homes built offsite and placed on foundations. One example is Brevard County, Florida where the development and building codes are focused on creating affordable permanent living options. A project I will be visiting soon has the development set up as a condominium, where the land constitutes the condo “unit” and the common areas are defined as the shared ownership with association expense responsibilities.