The Tiny House VS. a Mortgage – Debunking the Myth of Home Ownership

We have been living in our tiny house full-time since mid-May 2012 – a year and a half now.  Sometimes the house feels WAY TOO SMALL and my busy brain starts wondering (again), “WHY are we living like this???”  Why don’t we just get a loan?

One reason we chose to build our own tiny house was to escape the debt of a MORTGAGE, the typical requirement of home “ownership.”  (I use quotes because we often say that we own our homes, but if we’re paying a mortgage, the bank is actually the owner.)  Read all of our reasons for going Tiny on our Why Tiny? page.

During one recent period of tiny house discontent I started thinking about interest rates – only 5%!!!!  Well jeez, that is low… 5% of $200,000… is only …. $10,000!  That’s nothing!  We find a $250,000 house, put $50k down… borrow $200,000 + $10,000 interest… Why are we so against mortgages??

(Personal note: I have never had a mortgage, always rented, primarily due to a deep loathing of debt, and secondarily due to the fact that I never could have gotten the funds needed to buy a condo in L.A. or Denver, especially not after the crash of 2008 – in 2009 I applied for a mortgage loan and was approved for $80k.  You can’t buy jack for $80k in Denver.  Shane, on the other hand, has had mortgages since he built his first house at the age of 18.  He was always able to build / buy low and sell high, until the 2008 crash, when home values dropped about $100k in his town.  The mortgage company would not reconsider the value of his home, continuing to charge him mortgage payments on a home worth $280k when he could only hope to sell it for $180k.  His mortgage payment was also about $300 a month higher than what he could rent the house for.)

Shane found an online mortgage calculator to show me the actual cost of a 5% loan…  Seeing the amount of money paid on top of the listing price instantly rekindled my interest in living in a Tiny House!

So, while 5% of $200,000 is indeed $10,000…. that is not AT ALL how mortgages are calculated.  (I realize this is elementary to many, but I love seeing the numbers – makes me feel better about living in 200 sf.)

We would actually end up paying the bank $186,511 (over 30 years) in order to borrow that $200,000.  Which is 93%, not 5%.  (You don’t hear anyone raving about record time low interest rates of 93%!)

And that house that was listed at $250,000?  We would end up paying $480,261!  Wow.

An image from an online mortgage calculator:

And if the $93,750 total tax is on top of the $480,261… that’s $574,011!  Over half a million dollars for a 2 BR / 2 BA starter home…

Now the story we’re told here in America is that Home Ownership is the American Dream, you aren’t anything unless you own your own home.  I seriously think the bankers might be behind this bit of American folklore – it definitely seems in their best interests (pun…) to get people to “own” their own homes.

Well, the reason so many intelligent and logical people do choose to pay banks is because they feel that they are “throwing their money away” on rent, and a mortgage is… Equity, right?  An investment in your future…

Eq-ui-ty : noun : fairness or justice in the way people are treated [incredibly ironic?]

: finance : the value of a piece of property (such as a house) after any debts that remain to be paid for it (such as the amount of a mortgage) have been subtracted

So let’s take a look at Equity:

$250,000 house

$50,000 down payment

= $200,000 loan / mortgage = $1,334 per month + $3,125 taxes per year

After 5 years I still owe $183,349.  Gulp.  But… my house is now worth $280k instead of the $250k I paid for it.  So, I sell, maybe to make a profit, maybe because I have to move, who cares why, everybody’s doing it.

$280,000 – $183,349 = $96,651 “profit”

– minus the $19,264 closing costs (5.1% to the realtors, 1.78% tax) = $77,387 “profit”

– minus the $15,625 in taxes I forked out over 5 years = $61,762 “profit”

= barely enough to make a down payment on a similarly valued home and start paying rent to the bank again.

Oh, and what about the $50,000 I so generously donated to the bank?

– minus the $50,000 down payment = $11,762 “profit”

AND what about the $1,000 per year I had to put into fixing the HVAC system, installing gutters, removing that tree, etc. etc.

= $6,762 profit.

I paid 5 years of monthly payments at $1,334 = $80,040 to live for 5 years, and I’ve only saved up / profited $6,762 when I sell.

The other way to own a home, the way that we’re trying to do it (and many other tiny housers / thrifty dwellers), is to live small, save, and build a house debt-free.

Over five years of living in the tiny house we will pay $934 LESS per month ($1,334 – $400) = $56,040 + that $50,000 down payment = $106,040 saved up / profited over 5 years.

Tiny house too tiny?  What if you rent a smallish place for $900 per month  – over 5 years you’ll be able to save $26,040 from not paying a mortgage + that $50,000 down payment = $76,040.  WAY more than the $6,762 profit from buying and selling.

So why exactly is home ownership so wonderful?  Because the banks make money on our borrowing.  Granted, if you stay in your home for 10 years or 20 years, you can actually come out ahead, though not really enough to retire on…

According to Bankrate calculators you’d still owe $101,225 after 20 years of paying on a $200,000 loan.  That’s more than half of the loan!  After two DECADES of paying it off.

I think people just get comfortable with the cost of housing being $1,000 – $2,000 a month and just pay it.  For their entire lives.  But how is that not Serfdom?  And banks have some incredible leverage because it takes SO long to save up $200,000 (legally…ha) to buy a house outright.  So for us, the Tiny House may be INSANELY small but it is allowing us to save up enough money to get into a more comfortable house without paying interest to a bank.

This was a LOT of numbers, if you’ve made it this far, thanks for sticking with me!

I’m curious about other people’s tactics to own a home debt free…

[ I’m sure there are errors in my math / logic / understanding of the mortgage system – forgive me.  I know I’ve omitted things like utilities, paying a mortgage off early, homeowners insurance, mortgage insurance, etc.]

Categories: Opinionated Rants | 38 Comments

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38 thoughts on “The Tiny House VS. a Mortgage – Debunking the Myth of Home Ownership

  1. Great post showing the math in a logical way, people have a hard time understanding this stuff but it is definitely not the general public benefiting from the ‘American Dream’

  2. pelorojo

    Mortgages aren’t the enemy. Yes, they can be used for evil 30-year-long soul-sucking promises of home ownership. But they can also allow for more house than one can save for in a reasonable amount of time. Actually there a number of benefits (oh dear, I feel a list coming on…)

    1) The use of NOW. So you spend 10 years saving money for a house. But how much is that house, the one you could have bought, going to cost in 2023? If you start now, and you grab some roomies and throw a lot of money at the principle, you could pay it off in 15 years!

    2) Nest eggs for people who never save a dime. There is an 80-something guy across the street from us. He has social security. And his house. That’s it. But he always says “when I need to go to the old fogueys house, I can sell this house”

    3) The Almighty Rental. Say you continue to live and enoy the tiny house but you have some extra money to invest. Consider a low cost home. Put 20% down. Add some sweat equity. Rent it. You write off evey penny you put into it, send as much as you can to the principle, and in 15 years, maybe you own it outright. Maybe that rental property is your alternative to a job then. Maybe it’s the income that allows you to work a little less. Or retire a little earlier.

    Don’t blame the mortgage. It’s the mindset behind the borrowing that should be under scruitiny. People “qualify” for 200K so they buy a 200K house. When really, a 140, or even a 120 with work, would be a great home. Like any financial tool, there are risks and a potential to make painful mistakes. But overall, with the right planning and patience, you can use a mortgage for the forces of good, not evil.

  3. 1999 we bought a mortgage on a nice medium to large house (about 2700 sq ft total finished). The one we are in now. To get the lower mandatory monthly pmt we went with the 30 yr fixed rate mortgage. But we qualified for more house than we went for. Didn’t want more house since it was more than we had and more than enough at the time. Isn’t that part of the American Dream? Instead of settling on the regular pmt for 30 yrs we decided to cut the total interest by more than half by paying extra each month because we could. We were able to double the principal portion of our pmt and carefully watched how the bank applied our extra pmts. They kept wanting to simply apply it as an extra pmt with interest as if we were just paying next months pmt ahead of time. I insisted and made them apply all the extra only to principal. I’m sure the bank saw it as robbing them of interest since my way reduced the amount interest was calculated on for the next pmt, and doing that every month reduced the interest a lot in a hurry. 2yrs ago we paid it all off after only 11 yrs. Obviously we did pay more than the advertised purchase price but not as much more as we would have if we had followed the banks’ mortgage pmt schedule. Now the only debt we have is what we charge to our credit cards during the month… which we pay off in full when the bill comes so no interest there. We only do that as a convenience over carrying lots of cash or writing checks. Some places only take cash or credit these days, and some even only take credit!
    Investment? Definitely NOT. I would never consider a house or a car or any other big expense as anything but an expense. Even though “usually” a house may sell for more than the original purchase price. As you pointed out, you really have to sell a house for a lot more than original price to make any gain on the sale. At least we won’t lose as much as many will when we sell.
    I would love to sell and build a tiny house much like yours. My wife, however, would go batty going that small at this time. She used to go to open houses to look at decorating and would come home and wish for a place like those she just visited. Now she goes and returns and is happy in our place and glad we don’t have a place like those she visited. She loves the decorating but likes our home better, so she applies some of the decorating ideas she sees. This alone can get expensive sometimes… part of that cost of owning a house that really never is recovered in the sale.

    Well, there I go again. Rambling on and on.

  4. Michael

    1. Buy a home well within your means (<40% of income — don't max out what bank's will loan you, they will likely loan you up to ~60% of income or higher.)

    2. With the extra little bit of money, pay extra on your payments. (this can likely reduce the interest you pay GREATLY and in turn…. turn that 30 year mortgage into a 22 year mortgage.

    3. Save until you can start with 21% down payment so you don't pay PMI/MIP.

    4. Interest paid on mortgage is tax deductible up to a certain amount.

    5. Lastly, seriously consider where you buy. Suburbs (in most cities right now) are not an investment unless you're there for 30 years. If you live in the city in the right area it can be a lot more stable and likely more profitable over time.

    6. Shop around for lowest APR with a reputable company. Every 0.1% counts and don't pay for points or fees above the interest rate.

  5. Bettina Johnson Larsen

    For mom and myself the answer: both on our own…so why should both of us have the standard 3bdrm/2b/2car (whether small -900sqft or med size12-1500) and make such a horrible footprint. As we did well as roommates for a year, we decided to sell her house and buy one closer to where I worked as well as hospitals/shopping etc.
    With both our resources we put 1/2 down, my commute distance is 8 miles (more than half a distance savings from the suburb) we can walk to grocery/movies/restaurants, all else is within 3.5 miles incl. the local community college with a performing arts center, gym, mall, home repair store…. More families are doing what we did. It does take lots of cooperation, negotiation, understanding with generational/age differences. This move reduced our mortgage (incl tax/insur) to under 800 – less than a 2 bedroom apt in a decent area in town. I would love to live tiny and when Mom is no longer around…would love to do so; If I can find a spot in the kids back yard 😉

    • Hi Bettina!
      I love that you’re living with your mom – that is so great. and within walking distance to amenities is also wonderful.
      Combining family resources is another way to live efficiently and effectively.
      We’ll keep you in mind for a tiny house in the future! 😉
      take care,

  6. Dave

    Maybe I’m the ‘enemy’ chiming in here, (I’m a Realtor) but realistically speaking, buying makes sense – sometimes. If you see your situation changing, and you’ll likely be moving within the next 4-5 years, renting is probably best. If you look at some areas that are really desirable, and prices are outrageous, but rents are still reasonable – then rent. But remember, if you’re renting, you *are* paying a mortgage, just not yours. Any landlord worth their salt has figured rent to be their capital costs (mortgage or desired return on their money) plus taxes, plus maintenance, plus some profit. Unfortunately, buying a home has become so flippant in the past decade, many people walk into it unprepared. They don’t have money saved up. They don’t have the fiscal discipline. But most importantly, they borrow too much, and buy much more house than they need. This is almost always a fatal mistake. As has been mentioned, there are ways to do mortgages right. Size up your needs very carefully, and don’t get crazy. Keep your budget to the point where you can put a bit more down on your principal every month. You will save *tons* of money down the road, and trim years off the mortgage. The beauty of mortgages comes in down the line. Unlike rent, your mortgage payment stays fixed. So, in 10 years, as inflation eats the debt away, the payment becomes a smaller part of your income. Another part of the problem is that the average person moves every 6 years. If you’ve bought a house, as Carrie pointed out, you’ve paid a lot of interest, but not paid down much principal. Then, you have a transaction costs. That’s great for my business, not so great for you.
    Now, before you think I’m the guy that wants to keep people in debt forever, I’m not. I believe that debt can be a tool, but should be used only sparingly. In my mind, the best mortgage balance is $0.
    I hope the tiny/small house trend continues. The era of the oversized house is not sustainable from environmental, emotional, and financial standpoints. I think it makes people anxious, unhappy, and slaves to financial commitments. Scale it back, and we have a model that works a lot better.

  7. Ivan

    Hmm… I read lots of posts from all over the internet every day but I rarely feel compelled to comment on any, yours however tickled me. Two hundred thousand dollars for a two bedroom “starter home,” I’m somewhat of a real estate buff, I own several properties and go on lots of open houses and such. The last open house I went to for a house in the 250-300k range was anything but a starter house. It had eight bedrooms an eight car garage and an indoor pool. Last year I bought a three bedroom house in Dallas in an okay neighborhood for about seventy thousand dollars and it was not a distressed or foreclosed property it took a few months of negotiating but it was the final selling price. This year I bought three acres near El Paso, Texas where I live for forty five thousand, had six rental units renting for six hundred bucks a month built for about thirty thousand. So maybe I’m a slum lord but it pays the mortgage and I take profit about three thousand dollars every month. My latest project is fixing up four distressed properties I bought at a tax auction, the most expensive of which was about seventeen thousand dollars. I think you’re real enemy isn’t the mortgage but your perception of what a starter home is and how much you should pay for it.

    • wow, apparently Texas real estate is much cheaper than New Mexico and Colorado! starter homes in Colorado and New Mexico are indeed in the $200-$300k range…

      • Carrie, that may be Denver. But you can get all sorts of cute homes in rural/small town Southern Colo. (Think Trinidad and Walsenburg) for well under 100K. In fact, some for a little as 30K that need work.

    • William

      What you have is LOW property prices. I have family in Corsicana Tx, and have looked at moving there. House prices are about HALF what they are here in the greater Chicagoland area.

      Even in this region, you have wide variables in pricing. Gary, IN is incredibly cheap. But it was also the murder capital of the US for almost 20 years. The North West side of Chicago is incredibly expensive. It’s full of gated communities on Golf courses.

      Much of this debate goes down to location – location – location

      I wouldn’t call you a “slum lord”. I’d call you a business man. You provide clean, affordable (hopefully well maintained) housing at what sounds like reasonable rates. No one is forcing your tenants to sign their leases, right?

      That’s your job.

    • Seeking Joyful Simplicity

      Umm, it all depemnds on your market area. Here in northern VA/DC area (where there were Many decent jobs, even during the recession), you cannot buy for less than $200K, and even then you will be buying a fixer-upper…

    • Angie

      Ivan clearly did to take into account the AREA. Not all markets are the same Ivan. Even in Texas. I personally live in the Dallas metro, and even here, $200,000 only affords you a decent starter home–certainly no six bedroom chateau. A little more research may be needed on your part prior to your self proclaimed title of real estate buff, Mr. Slum Lord.

  8. It’s interesting reading all the banter about what makes for a “starter home” when all that misses the point of the blog. For one thing, rent is not debt. A mortgage is. For many the ratio of how much money they owe (debt of all kinds) vs. how much money they have is what can hurt their credit score in a big way. While rent is an expense that is gone for good once paid, a little bit of the cost of buying a mortgage to have a house (which is the only realistic way to see it) is recovered when the house is sold… provided the owner holds onto it for longer than just 3 or 4 years. Of course the downside is that closing costs at purchase and even at sale inflate the outlay of cash that requires many years to build enough equity to just break even in a sale. Another downside is that while the monthly payment for a mortgage may be lower than rent for a comparable space the interest masks the real cost to the homeowner as indicated in the article above. Many people do realize interest adds to the cost of a mortgage but most don’t really think about just how much more. And that’s the big surprize for most people when they finally get around to looking at it, or come away from a sale with less overall than they expected!

  9. Loved reading this and all of the responses…so much food for thought. Thanks, Carrie!

  10. William

    I make half my monthly payment every two weeks (since I get paid Bi-weekly). This cuts YEARS off the length of the mortgage. Up to 12 if you keep it up.

    I’m recently divorced and have full custody of my boys (yes I’m the dad) and am doing my best to get debt free. I want to work to afford to spend time with my kids, not to be chained to a house.

    I’m really interested in building a tiny home trailer for myself after my boys grow up. Kinda like a sailboat without the constant worry of sinking! 😉

    • That’s great! not many people have the discipline or means to keep this up. There are many methods to cut the loan down in time and interest paid. My wife and I were in a position to do really well with this. We both work, we live off my income and save hers (about a 55/45 split). we paid our mortgage payment once a month but almost doubled the payment and forced the bank to apply the extra to the principal only. This cut 18 years off the 30 year mortgage! We had to really keep on the bank to apply it right because they kept trying to take out a month’s interest from the extra as if we were just paying next month’s payment early but I kept on them to re-adjust and they did (reluctantly but they did). No mortgage now. Woohoo!

      • William

        My first mortgage company was HORRIBLE. They over paid our taxes by three years worth and jacked up my payments to compensate! It was a relief to get a refinance!

      • Another reason why we never allowed any mortgage holder to set up an escrow account to pay our taxes. We refused that part and handled pmt of taxes ourselves separate from any mortgage.

  11. was just re-reading your post and noticed you left out the final interest payment due when paying off the mortgage after selling in your example. At the 5% apr that comes to an additional $763.96 due (banks usually round up when it comes to money owed to them). That brings your profits down to $5998.04. Also, around here the realtor collects closer to 7-8% for selling services unless a deal is made for the buyer to cover that, so profit is even less! And, since I keep hearing about in some areas where the housing market is still just now getting back to the home values from before the burst there is a question if there would be any profit at all, or a loss.

    As to the “starter home” question… referring to your post about gen Y yuppies and entitlement…
    I continue to hear about younger couples just starting out with home ownership in their 20s and early 30s (whom I know from them being former students of my wife who was their 3rd grade teacher) buying “starter” homes that are the equal to what their parents currently own! That means prices in some cases around $180,000 to $250,000 easily in our area. Of course, I also hear of others from the same age group who move into true starter homes (true as in what WE would consider starter) on the other side of town at prices around $75,000 to $150,000. So it all depends on your circumstances financially/job wise (and if your parents are in a position to assist). Just a few more random thoughts.

  12. Sorry about continuing with the verbose gabbering here but out of curiosity from reading this thread I just had to take a look at my own home ownership situation. Thought I’d share what I discovered (what even surprised me). We bought our house near the end of 1999 for near $200k. We refinanced a few times for the lower interest rates that came along. This actually did allow us to pay off the mortgage early a few years ago. The fact we both work good jobs and kept expenses low was a big contributing factor in that feat.
    Anyway, I calculated the true cost of the house including purchase, interest, closing costs each time, property taxes and big improvements-repair. I didn’t include any of the large expense of buying some new furniture and other things that have to be bought for a new house (curtains, rugs, other extras). The market value of the house if I sold today would be something around $250k. The cost I put into the house to date came to about $366k with only what I mentioned. I calculated that this is the same as if I had rented the place for about $681.50/mo for the time we’ve been here so far. Since it is paid off that rent equivalent will go down just a little each year we stay here. Not quite what I expected to find.

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  14. whitney

    I love your project! My name is Whitney, I am completing a Certificate at Yestermomrrow Design Build school in Warren, VT. For my project I am researching the availability of homeowners insurance for tiny homes. If you own a tiny home please take a few moments to fill out this survey. Thank you for your time!

  15. Robert

    Hi Carrie,

    Thank you this post. Owning a home via mortgage works for some people, others not so much. If more people had the numbers in front of them that you present they may make different choices. I “owned” my home via mortgage for about 6 of the most stressful years of my life. Got divorced and bought the house from my ex just in time for 2008. I’m self employed. The ensuing years of recession set a new standard for business owners. Success was defined by not growth in your business but by keeping the doors open. I was fortunate to be able to sell my house in 2010 and break even, almost. I did all the calculations that you posted and came to the same conclusion. It was very difficult for me to come to terms with nearly 30 more years of monthly payments (to an entity that I distrust) all with the very real potential of a visit from the sheriff with eviction papers if I miss a few payments due to unfortunate circumstances.
    I’m now building a “tiny house” (I’m ready for some new language here). There will definitely be trade offs. I lived on a sailboat for 5 years. Like you, I’m very uncomfortable when in debt. Downsizing is a great way to go, and available if it suits.
    Your post is an excellent reminder of the concept and ethic behind the decision that I have made and many others are making as well. I would like to see more articles on the topic of finance. Your post was clear and factual, very well done. Bravo!
    Keep up the good work.

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  17. Bill

    You forgot to factor in the tax benefits of owning a home. The interest and property tax is tax deductible. Owning a home is worth if you intend to stay for the long run. After 30 years, even though you paid almost double for the cost of the house, you still have a place to live. After 30 years of paying rent at an average rate of $1500 a month, you would have paid $540,000 with nothing to show for it.

    • Owning a home MAY be worth it. Depends if it is right-sized for you. Not everyone can take the income tax deduction for mortgage interest/property tax. You must get it through itemized deductions which not everyone should take. Average rent in our area is much lower than in your area I guess, closer to $950/mo. And that includes all utilities which is a cost not included in the mortgage and you continue to pay as long as you own a home continuing after the mortgage may be paid off. Property taxes continue also and often, if you don’t have very many other deductions, you cannot itemize on the tax form and therefore cannot take that deduction. That deduction is not so much an incentive to buy per many surveys on that very subject related to some recent efforts to do away with the deduction. I own my home (mortgage paid off). When I was paying mortgage interest the benefit was really not so much the incentive we are sold to believe.

  18. EastCoast

    I love your blog Carrie, I hope you’ll be posting again soon. I’ve gone the mortgage route mainly because it is a predictable, stable expense. Rent can go up, dramatically sometimes, and it never ends. Once the mortgage is paid off (next year for me) that expense is gone forever.

    I love your house….so many tiny houses have an interior that is wood on wood on wood. I like wood, but not THAT much. Your house is beautiful and efficient. 2 people in a small house must be a challenge, well…actually I envy Shane to live in cozy quarters with such an attractive lady.

  19. vstanley

    Apples and oranges comparison.You are not going to live in your tiny house where you would buy a house for 280K.So U cant live there for 10K..
    This seems a rant caused by so many people being underwater in their mortgages.If it had gone the other way…..
    I agree,Long term debt is not a good idea.Interest is substantial.Maybe building your own smaller conventional home is the middle ground?We did.

  20. Will

    My history is designing extra large custom luxury housing but after designing four houses in Japan I have become interested in tiny housing also. Right now I am working on micro apartment buildings and have created a site to explore experimental small buildings. The size That interests me is just a little larger than the very tiny house on wheels.

  21. Lucas

    As Bob said, a good number of people in this country don’t understand that homes are NOT investments, they’re consumer products. Land is an investment. Homes are like cars, by the time you figure in the full cost of ownership (mortgage or not) and devaluation of your money (interest is devaluing your money every day), you’re lucky to break even.

    The people who profit at home sales are builders, bankers, realtors, and flippers (distressed purchases). You have to improve the property to actually see a return, thus an investment.

    To make “owning” your own home even less attractive, there’s the looming MERS issue with Deeds of Trust, rampant Mortgage Fraud, reselling your mortgage up to 30 times over (not 30 sells, but the same mortgage sold to 30 different people at the same time – see derivatives and loan levels if you’re interested in understanding this looming fiasco)… I could go on… in excruciating detail.

    I really think the best thing people looking to upgrade from “renting” is the Tiny House idea.

    You’ve built/bought a home that you own outright. While renting a spot for relatively cheap (I would think these qualify for use in RV Parks/Motor home Lots if need be, though not an ideal location, always an option) you can save up for some rural acreage. Once you’ve got enough for undeveloped acreage (this can range from $400 an acre to $20,000 an acre) you can put in the utilities ($10,000 – $50,000) and park your tiny house there while you save up to build a larger residence (if that’s your intent).

    You also have the ability to move to better economic conditions with minimal fuss. No rental history, credit history, proof of income, etc. Many places you can rent a rural industrial location (shop in the woods) for cheap and park the house there.

    And when all is said and done you still have a house on wheels that you can park at a cabin site or for use as a guest house, give to your kids (depending on how you built it), etc.

    If your costs per month is $400 + food & gas, you can do nearly anything anywhere and break even. That’s some serious freedom.

    Oh, and debt IS servitude.

    • Great comment, all true. Living tiny for a few years is a small price to pay for freedom from servitude.

  22. Buckminster Fuller designs worth considering

    I’ve wanted to live smaller all of my life and am horrified at what it costs to build a tiny house compared to Buckminster Fuller’s geodesic designs. Check out his huge variety of designs, from sheet metal to cantenary tent to beam-and-cable (tensegrity). So much cheaper and easier to heat/cool. The best collection of blue prints is in a book titled: ‘Inventions’. Plus they withstand high winds and are able to easily exceed the 2000 sq/ft minimums required in many building codes. Because the perimeter is the only part that requires a footing, you could get away with a mud floor, further decreasing your costs. So many options to choose from and well worth checking out ! If your are considering scaling down than you will be well repaid in savings by digging into his ingenious designs.

    • Geodesic domes are cool! they are very different from Tiny houses though, mainly in that they are not mobile… also the acoustics are very strange in a dome, in my opinion, really horrible.
      I would imagine domes would cost about the same as a tiny house build, if not more, if they include the same plumbing, insulation and finishes inside and out.

  23. Kim

    You can find cheap real estate, even in New Mexico, if you take your time and watch the market. I just bought a small home on an acre of land in Santa Fe (a known high dollar area) for less than 100K. Listed with a realtor, so this wasn’t some sort of lucky word-of-mouth deal. Now….is it a palace? No. But it has two bedrooms, a lot of character, and tons of potential. My mortgage is less than $500 a month.

  24. I love the idea of a tiny home, and actually lived in a motorhome I owned debt-free for a couple of years. However, I feel the need to point out the logically fallacious nature of talking about “profits” (or the lack thereof) regarding homeownership:

    If you are factoring in the money you have left over after you sell your house and saying that the fact that you only have a few thousand dollars in “profit” somehow means that it wasn’t worth it, it is intellectually dishonest not to also recognize that if you have paid $300,000 in rent over that 30 years, you have sustained a $300,000 loss. That is exactly why intelligent people who are going to stay put for 30 years purchase a house instead of renting one. I’ll take a very small, tiny profit of a few thousand dollars over a $300,000 loss any day. LOL

    • good points. the initial article was more about a mortgage vs. living small and saving up money to buy outright / quickly. yes, rent you don’t get back. but I still don’t like the way banks make SO much off of mortgages. so we pay double the list price. boo.

  25. Linda

    Going tiny does seem like a good idea BUT for some of us we also have to take into consideration the land OR where to park it IF you’re not living in a rural area? I live in the suburbs of Chicago and the only places to park a tiny house is on a lot where mobile homes are located and it’s not always conducive to where you work. So although I’m very interested I still need to get more options on where to park without it costing $600 to $700 per month to rent the land and that doesn’t include utilities. When I figured everything out financially, I’m just shy of 2-3 hundred less than what I’m paying for my current mortgage. Since I’ve already taken the mortgage plunge and live in the suburbs… Does anyone have any pros for going tiny in my situation?

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