Tiny houses big problems

It probably wasn't the vision of urban planners when the concept of being thrifty, green, and trendy was first talked about.

The equivalent of $1,000 per square foot for a tiny home might seem little shocking. But read this week's headlines, and you will see that this is actually happening.

To make matters worse, planning and government jurisdictions are giving incentives to developers of tiny homes in a multitude of ways, so is it just the tiny home trend a rip-off?

Yes and then again, no. We have had tiny homes for years.

Let's be honest, this is nothing new. My first home, a caravan in the U.K., was about 164 square feet and cost me $1,200, about $13 a square foot.

I know it was a long time ago, but that was a great start for a young kid.

Then, together with my wife, I got into bricks and mortar. We purchased a 400 square foot home for $50,000. We were so excited, for a similar price again (per square foot) ,we got in to a real house.

Sure, the living room was smaller than my current bathroom, but we were as excited as heck.

In Canada, if you grew up in urban areas or The Prairies, you are probably used to living in small spaces also.

We got greedy

Then, life changed. Material possessions became ultimately important. Bragging rights morphed to how many square feet you owned, then, whether you had stainless appliances or granite counters.

What was once the finishings of the world's millionaires became common place, and, in fact, even demanded by ordinary citizens.

Then, we had a global financial crisis, in large part caused by our own greed.

Tiny houses are re-born

Suddenly, there is a boom in tiny houses. No, not a boom, a veritable explosion, a media frenzy.

Everyone was talking about something that had been around forever as if it were the newest, coolest option.
I recall in Canmore auctioning off a subdivision of tiny lots for tiny houses way back in 1998. It was perfect.

Did other municipalities look at it as a success? Nope. In fact, I have not seen another development use a zero lot line concept (a shared lot line) to build smaller houses on smaller lots.

Why? Because municipalities and citizens probably think it is ugly. It is OK over there, but not in my back yard.

TV hype

The TV Industry started to popularize tiny homes with spun-out dreams of romantic, tiny homes parked in glamorous locations, giving the owners a dream lifestyle.

But we didn’t just build tiny homes. We built designer, tiny homes. Throw caution and budget to the wind; we were willing to pay for the coolest gadgets, the cutest designs and multi-storey tiny homes (An oxymoron if ever there was one!)

Enter the marketers

Never skipping a beat, the smart marketers moved into town, convincing the municipalities that they were going to solve the world's problems (one of which people think is housing affordability) and, badda-boom-badda-bing, we look at the results and gasp.

Lets grow up - just for a second

Now, we see advertisements in Kelowna for $1,600 per month rentals for a 300 square foot apartment.

That is equivalent to a mortgage of close to a $400,000 or to put it another way, the cost per square foot if you paid $400,000 for that same unit would be $1,300. 

Do we have a problem? Sure, perhaps there should have been some strings attached to those enticing developer incentives.

The problem we have is probably more to do with stupid people if anyone takes up that offer to rent something a little larger than a sandbox for $1,600 a month. 

So let's not be too concerned. We can, of course, advertise anything for rent or for sale, but on the other side of the deal, there has to be a willing buyer.


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About the Author

Mark has been an entrepreneur for over forty years. His experience spans many commercial sectors and aspects of business. He was one of the youngest people to be appointed as a Fellow of the prestigious Institute of Sales and Marketing Management before he left the UK in 1988.

His column focuses on ways we can improve on success in our lives. Whether it is business, relationships, or health, Mark has a well-rounded perspective on how to stay focused for growth and development.

His influences come from the various travels he undertakes as an adventurer, philanthropist and keynote speaker. More information can be found on Mark at his website www.markjenningsbates.com

He is a Venture Partner with www.DutchOracle.com a global Alternative Investment company.

Mark Jennings-Bates:
[email protected]

Photo credit: www.SteveAustin.ca 

The views expressed are strictly those of the author and not necessarily those of Castanet. Castanet does not warrant the contents.

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