14 | October | 2013 | Love's Real Stories

Tiny Time

Signs of the times: A former Hummer driver, now behind the wheel of a Mini-Cooper; a former Super Store shopper with a devil-may-care budget, now harvesting home-grown produce from their own garden plot; a former mansion owner, now living in a Tiny House.

“Tiny House” isn’t merely a reference to a house that is small; it’s a category, like “Condo”, or “Apartment.” “Tiny House” has become part of the conversation for people looking for affordable real estate, people looking for a scaled-down lifestyle- no gas guzzler, no shopping spree, no wasted living space.

A Tiny House is smaller than a shotgun house, a cabin, or a guest house; smaller than your garage. A Tiny House is so small, as my friend Ken DuVall would say, you have to go outside to change your mind.

A Tiny House is the size of a shed, typically 250 square feet or less. But it has everything. The kitchen is there, the bathroom, the bedroom, the living area. The people who buy, build, and live in Tiny Houses tend to pour their heart and soul and creative flair into their design, construction, and decoration. You have your Cape Cod, your Victorian, and your California Craftsman. You have your high ceilings, your natural lighting, and your energy efficiency. You have your low, low, low, utility costs.

People who buy, build, and live in Tiny Houses tend to say things like, “Living small emphasizes home life over home maintenance.” And “The McMansion way of life is wasteful and expensive. We need to recognize what fills a home when the excess is cut away. Living small can free up your mind, your wallet and your soul.”

Jim and Julie Wrenlich bought a five-acre sloping lot in the California foothills. It has pines, oaks, and manzanita, and came with an old manufactured home. They chose a spot just uphill from the existing homesite and cleared a small area to build their Tiny Home. They built a cabin-design, 220 square feet, tall-ceilinged with a loft, steep roof with green metal roofing and dormer, and a covered front porch and deck. Underneath, between the floor and the sloping ground, is storage.

“We bought the land for $45,000 and built the house for $25,000, including permits and fees,” says Jim. “We sold off the manufactured home for $8,000, so we’re in the whole thing for just over $60,000.” A construction loan paid for the project. “Our payment is lower than our rent was,” says Julie, “and we have a brand new home. We couldn’t afford to buy a regular house, and this is better, anyway.”

Logan and Tammy Strobel live in a to-go version of the Tiny House, 128 square feet on wheels, built on an 8’x16’ trailer. It’s a tall, cedar-sided beauty, fully self-contained, with an alcohol-burning stove, composting toilet, walls insulated with natural wool. “We designed our home”, says Logan, “and it fits us like tailored clothes.” Good thing it’s a to-go version, because it went. They towed their Tiny House from Portland, Oregon to Mt. Shasta in Northern California to be nearer Tammy’s family and her ill father. They parked it on country property owned by family, instantly right at home. A garden hose and an electrical cord from the pump house did the trick for utilities.

The simpler life, the less expensive life; the smaller impact lifestyle: all part of the Tiny House phenomenon. If you’re ready to give up the man-cave and the lady-lair, the maintenance and the bills; the entertainment theater, the bonus rooms and frills; you too can leave a smaller footprint. You could make it Tiny.

Big Shot

I attended a big high-level conference in Washington, D.C. where people-in-the-know delivered the news on the U.S. economy. Bankers, investors, and government representatives were rubbing elbows, shaking hands, and generally having a great time. When real estate became the subject of discussion I jumped right in with both ears.

For all the participation I contributed, I might as well have been miles away. Truth be told, I was indeed miles away. I was in California, staring at my computer screen witnessing the goings-on in Washington, D.C., via a “webinar.” I (and many others I assume) loomed above the conference in a sort of cyber-gallery, watching the bigwigs hobnob.

The real estate portion of the conference boiled down to this:

Real Estate isn’t as hot as it’s been cracked up to be. Reports of double-digit price increases are true, and people have been expressing worries of another housing bubble, but set those worries aside.

“We are of the view that housing is continuing to grow, but we are not of the view that it is robust,” said the FHA guy. He said real estate is not the economic driver it was a decade ago. Yes, home prices have moved upward quickly, but those gains are just a bounce-back from the severe drops of the recent past. Home builders are on the scene buying lots and building, but they’re going about it cautiously. Building-related jobs are a slow-grow, and land-buying is minimal, so construction hasn’t been the big economic driver we might expect. He said when construction picks up momentum, it still won’t hit the frenzy of the boom years; jobs will be fewer than might be expected, too.

Rising interest rates will not shut down housing and economic recovery. Fannie Mae economists did a study recently on the correlation between a sharp increase in mortgage interest rates and rising home prices. Their study shows there is little relationship there. When interest rates go up, the number of home sales may go down, but prices are still likely to keep rising.

As a result of their study they were also very confident-sounding in making this prediction: “We don’t necessarily expect interest rates to surge again, and we don’t think any rate rises will be as sudden as we‘ve seen.”

It is a really great time to buy. Even though housing prices have bounced up from their floor of a few years ago, they are still down. Even though interest rates have moved up recently, they are still extremely low compared to historic norms. Buyers have it good.

The American Dream is alive. Homeownership rates have fallen significantly from the boom years, and after the financial crisis, some prognosticators predicted America would become a predominately rental society. But the economists at this conference say many people who are renters now are the same people who lost their homes in foreclosure and short sales, and those people will buy again. In our society, the drive to become a homeowner remains unchanged.

I returned home from the conference without difficulty, and overall it was a good journey. It’s handy when you can leave your seat, open your own refrigerator, and sing out loud, while still hobnobbing with the bigwigs.

Love's Real Stories

October 14, 2013

Tiny Time

October 14, 2013

Big Shot