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The definition of a tiny house is subjective, but for me, it's a home of 400 square feet or less, either on wheels or a foundation. I consider a home of between 400 and 1000 square feet to be small. Due to size specifications for rooms, clearances and distances between fixtures, building codes are a little more difficult for tiny houses to meet. However, it is possible. Small homes can easily meet building codes. Zoning is a challenge for both tiny and small homes, as many communities require houses to be 1,000 square feet or more.

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With the financial crisis of 2007–08, the small house movement attracted more attention as it offers housing that is more affordable and ecologically friendly. Overall, however, it represents a very small part of real estate transactions. Thus only 1% of home buyers acquire houses of 1,000 square feet (93 m2) or less. Small houses are also used as accessory dwelling units (or ADUs), to serve as additional on-property housing for aging relatives or returning children, as a home office, or as a guest house. Typical costs are about $20,000 to $50,000 as of 2012.

In Oakland, California, Gregory Kloehn builds small houses out of found materials, for an estimated cost of $40.

Small and tiny houses have received increasing media coverage including a serial television show, Tiny House Nation, in 2014 and Tiny House Hunters. The possibility of building one's own home has fueled the movement, particularly for tiny houses on wheels. Tiny houses on wheels are often compared to RVs. However, tiny houses are built to last as long as traditional homes, they use traditional building techniques and materials, and they are aesthetically similar to larger homes.

Sustainable homes are built using sustainable methods, materials, and facilitate green practices, enabling a more sustainable lifestyle. Their construction and maintenance have neutral impacts on the Earth. Often, if necessary, they are close in proximity to essential services such as grocery stores, schools, daycares, work, or public transit making it possible to commit to sustainable transportation choices. Sometimes, they are off-the-grid homes that do not require any public energy, water, or sewer service.

If not off-the-grid, sustainable homes may be linked to a grid supplied by a power plant that is using sustainable power sources, buying power as is normal convention. Additionally, sustainable homes may be connected to a grid, but generate their own electricity through renewable means and sell any excess to a utility. There are two common methods to approaching this option: net metering and double metering.

While the 2015 IRC has eliminated the requirement for a house to have at least one room of 120 square feet or more, states will need to adopt the new code in order for it to be effective. In addition, the IRC still contains other minimum size specifications that prove challenging: rooms (except for bathrooms and kitchens) must be 70 square feet, ceiling height must be 7 feet, etc. (additional code discussion). Accordingly, while it is possible for a tiny house to meet building codes, a house built on a foundation on its own land is more likely to be small (more than 400 square feet) rather than tiny. In addition, a building permit will probably be required.

Zoning regulations pose more of a challenge than building codes. Many cities and counties have minimum size requirements of 1,000 square feet or more for construction of a new home on its own land. The specific minimum will be determined by your zone. For example, in Manatee County, Florida, new houses in zone R1 must be at least 1500 square feet, but in zones R2 & R3 only 800 square feet. In contrast, in Sarasota County, Florida, there is no minimum house size. Call your local Zoning or Planning Department to find out what the minimum is for your land.

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