The Legal Scoop on Tiny-Home Living

The struggles of owners of movables to find long-term locations have made them a shrinking part of the tiny-house market. “Tiny homes on wheels are always going to be out there,” says Michael Buccino, founder of Micro Living, a tiny-home company in Steamboat Springs, Colo. “But to sustain the industry, you’re going to see more and more tiny houses built on foundations.”

There are challenges with those, too — the costs of land, building a foundation, connecting to sewer or septic systems, and legal restrictions in many places on the minimum size of permanent residences. But municipalities have become more open to this version of tiny houses, particularly when used as what are known as accessory dwelling units (ADUs). This is when a tiny home is added to a property where there already is a conventional house. The small residence can serve as a home for an aging parent or as a rental unit. Some also see  potential  for these dwellings in the Airbnb market.

For public officials, part of the appeal of tiny houses as ADUs is that they can become a new type of affordable housing. The average cost of building a tiny house is only $23,000; the cost of buying one is closer to $60,000, still far below typical home prices. “Every city and community in the United States is very aware that housing needs to change to accommodate people entering retirement,“ observes Ryan Mitchell, creator of The Tiny Life website. “These are people who have larger homes but are looking for a smaller place to live.”

Adds Gabriella Morrison, who with her husband, Andrew, founded Tiny House Build (both are longtime tiny-living advocates): “Many communities are required to provide a certain percentage of units as affordable housing. Many are required to build these units themselves, which costs a ton of money. Tiny houses, on the other hand, are essentially self-propagating affordable housing units.”

David Bailey and Stephanie Harrison-Bailey built this tiny house in Ybor City, Fla., and plan to break ground on a second one soon. It has 365 square feet on the ground floor and a small loft for a home office above. Rental demand for the house has been strong, they say.

Richard Danielson/AP Photo

A game changer?

Another positive development for owners was a change made in January to the International Residential Code (IRC) to establish, for the first time, specific guidelines for tiny houses. States use the IRC as a model for their own codes.

“It’s a game changer,” says Buccino, “because tiny homes, whether they’re on wheels or foundations, have a new set of codes that your local building department can now follow. It’s not changing the electrical or plumbing systems. All it does is say that if a house is under 400 square feet, you can build it to tighter standards, like the width of a staircase. Instead of being random, everyone can be under the same set of rules.”

A few communities have already become more welcoming to tiny houses. Back in 2014 the small community of Spur, Texas (not far from Lubbock), proclaimed itself “America’s First Tiny House Friendly Town,” eliminating the minimum size requirement for homes on foundations. Its rules have tightened a bit since then. House designs now must be submitted for approval, and tiny homes must be connected to the town’s electrical, water and sewer systems.

Two years ago the city of Fresno, Calif., took the revolutionary step of allowing tiny houses on wheels to be considered permanent residences if they’re parked on property that already has a larger home on it. Only one “second” house of 100 to 400 square feet is permitted on the property, but the resident doesn’t have to be a caregiver, which is what is required in numerous communities. Instead, the house can be rented to anyone.

And just last fall, in Lake Dallas, Texas, about 30 miles north of Dallas, the City Council approved a tiny-home village within city limits. Owners of the houses will be able to move onto a lot that is roughly 800 to 1,000 square feet. They’ll pay a rental fee of $500 to $550 a month, which includes hookups for water, sewer service  and  electricity.

It takes persistence

Getting public officials to warm up to the prospect of tiny houses in their communities takes persistence. The legal issues can be complicated, regulations vary from place to place, and there’s often a reluctance to embrace new and different types of housing, especially if they prompt negative feedback from other residents.

It’s critical to keep pushing the envelope, notes Buccino. In Steamboat Springs he has proposed that a parcel of real estate already zoned for residential development be adapted for tiny houses. It would be a variation of a conventional planned unit development.

“The hardest part in getting this done is having the first example,” he says. “If they would let me put in six tiny houses on foundations where it’s only zoned for two houses ... people can see what this looks like. At a certain point, you can’t talk hypotheticals; you need a real project to test.

“Every municipality can make a decision on its own. Every municipality has the ability to allow tiny homes in a way that works for them.”

Or, as Turnbull puts it: “The goal is to get more affordable housing by design — and to get them legal.”