By now, you have heard of the Tiny Home Trend where footprint trumps square footage and small homes are on the rise. Here's where the trend comes from and some thoughts to consider;
Family Values
Families come in all shapes and sizes and so too is their need for space. There are many individuals living alone for longer, living with roommates or families downsizing to the extreme.
Environmental Factors
Humans are becoming more aware of their impact on the environment and want to reduce their waste and utility usage. We know the more natural resources we destroy, the worse off future generations will be.
Money Saving
More people want to be debt-free, mortgage free and save for retirement than ever before. If you're a Netflix junkie like me, you've seen "How to Live Mortgage Free with Sarah Beeny". Not to mention, the smaller the home, the lower the maintenance!
Minimalism
Minimalism and simplicity is now a common term and when you say you're a "minimalist", others naturally understand your desire to decrease "stuff". It has also become super cool to be extremely organized in your home.
So, what's the problem? Why aren't we all living in tiny homes?
It's about practicality.
While it sounds amazing to "extreme downsize", live in less than 400 square feet and use less stuff, the reality is that it's not practical for most people.
Advice you can trust
Be open to mortgage advice from a trusted professional! I often receive inquires about building off grid, buying small homes and refinancing to add technology to decrease the cost of utilities.
I don't mind tooting my own horn when I say one of the most valuable services I offer to my clients is truth telling. If you can afford the home on paper, but it's going to drastically impact your life (insert eating mac and cheese for the next 5 years!), I will tell you. Ultimately, it's your decision, but it helps to have someone on your side making sure you consider the additional costs to home ownership, the upkeep of maintenance, the potential of rising interest or property taxes, and impactful life events during the term of your mortgage. I will also share with you ways to save money and the mortgage product that is right for you.
What do lenders think?
From a mortgageability perspective, lenders have a minimum space requirement, an interest in electricity and plumbing to ensure the home has it's most basic amenities for safe function and consider marketability potential should you default on your mortgage. Mobility is also a factor. Lender and mortgage options for mobile homes are limited!
What does this mean?
This means, lenders project risk to determine the chances that most buyers would be interested in your home if it was in foreclosure. Tiny, movable houses can be a risk from a mortgage standpoint.
What's the answer?
The answer likely isn't to buy the smallest house you can find in the woods, but rather buy the house that will meet your needs in the best neighbourhood that you can afford and outfit that house to save you money.
My best advice!
Live within your means and build equity in your home! You got this! Find the mortgage and home buying professionals that will help you achieve your goals.
Want to talk mortgages? I'm here for you!
Sarah Nixon-Miller, Mortgage Broker
Toll-free across Canada 1-844-315-6609
sarahnm@mortgagegroup.com