Tiny Homes: Trailers vs. Foundations
May 2, 2018
Have you ever dreamed about downsizing to a tiny house on wheels and traveling the country? Maybe you’ve fantasized about the spontaneity of driving from state to state, exploring new cities and taking in all the beautiful sights that accompany each pitstop.
Or perhaps you’ve envisioned yourself buying a tiny home on foundation and living either in an inner-city infill lot or somewhere off the grid, eliminating all of your unnecessary material objects and keeping only a handful of necessities to take with you as you begin your journey toward a more minimal lifestyle.
Both of these scenarios may seem like appealing options for those wanting to downsize, but which option is right for you: the tiny house kit on a foundation or the tiny house kit on a trailer? To help you answer that question, we’ve put together a list of pros and cons.
Tiny House on Foundation Pros and Cons
Tiny houses on a foundation offer a lot to love, including several benefits compared to tiny houses on trailers that could be appealing to you. Let’s take a look at the good side of tiny houses on a foundation.
Pro: Total Cost of Ownership
Purchasing a tiny house kit for a foundation requires buying land, which should be viewed as an investment rather than an expense. Property can range in price depending on the location and how much you wish to purchase. In some cities, smaller vacant infill lots can be as cheap as $500. Over time, tiny houses on a foundation have a lower total cost of ownership because they require less maintenance and appreciate. Tiny houses on trailers require maintenance for the wear and tear of wheels and the trailer itself. They can also take a toll on the towing truck, which can also be costly.
Key Takeaway: Tiny houses on a foundation have a lower total cost of ownership than tiny houses on trailers.
One of the most significant advantages of tiny houses on a foundation is safety. Whether you choose to build on a concrete slab or a crawlspace, tiny houses on a foundation are incredibly safe and sturdy. Unlike tiny houses on trailers, tiny houses on a foundation secure firmly to the ground and withstand harsh weather and even natural disasters.
Key Takeaway: Tiny houses on a foundation provide safer living quarters than tiny houses on trailers.
The options for financing a tiny home on a foundation are relatively equivalent to financing options for a traditional stick-built home. If your credit is in the neighborhood of 620, and you have a sufficient source of income, you should be able to find a lender for a construction-only or construction-to-permanent loan.
One problem you could encounter: some lenders hesitate to write loans on houses with low mortgage because they equal less money to make for lenders from interest. This is solely dependent on the lender’s stance, but it’s certainly worth researching during your decision-making process.
Key Takeaway: Tiny houses on foundation provide you with financing options comparable to traditional stick-built houses.
Tiny houses built on a foundation provide owners with home equity. While building equity can be a long-term effort, tiny kit homes on a foundation can give the owners that opportunity, unlike tiny houses on trailers, which tend to depreciate. Since 2012, homes less than 1,200 square feet have appreciated nearly 7.5% a year.
Key Takeaway: Unlike tiny houses on trailers, tiny houses on foundation can help you build equity over time.
Con: Lack of Mobility
If your desire is to take your tiny house across the country to experience new places, then the tiny house on a foundation isn’t the right fit for you. Without wheels, tiny houses on foundation don’t give you the flexibility that tiny houses on trailers do. Not having mobility can also be an issue if you choose to move at any time.
Key Takeaway: Tiny houses on foundation limit owners to a single location.
Con: Buying/Renting Land
If you’re planning on building a tiny home on foundation, you’ll need land to put it on. Buying property can be costly, and the total price for land will be dependent on the lot size you choose to buy and location. One of the issues with renting property is that landowners may end up selling the land that you live on, or ask you to move. This could potentially cause you to lose your tiny house altogether, or force you to spend a lot of money trying to have a crane lift it onto a trailer.
Key Takeaway: Buying and renting land can be expensive, and potentially even cause you to lose your tiny house.
Tiny House on a Trailer Pros and Cons
For tiny houses on a trailer, most of the pros stem from mobility. There are several different benefits wheels offer, which we’ve broken down below.
Pro: Ability to Travel
If you dream of packing up and hitting the road, a tiny house on a trailer is the better option for you. Tiny houses on a trailer give you the ability to travel wherever you want, whenever you want. They are ideal for adventure seekers, and those who love to road trip and experience new destinations. Most RV parks are tiny-house-friendly, giving you a place to park your tiny home on wheels while also providing access to utility hookups.
Key Takeaway: Having a tiny house on a trailer gives you the ability to go wherever you want, whenever you want.
Pro: Avoiding Threats From Mother Nature
One of the significant advantages a tiny house on a trailer is the ability to escape an area easily during flooding, a hurricane, a forest fire, or another natural disaster. Whether you live near in a flood zone or in a fire-prone area, tiny houses on trailers give you the option to flee an area to avoid disaster quickly.
Key Takeaway: With a tiny house on a trailer, you can relocate to a safer location when a natural disaster threatens.
Pro: Relocating from Rented Land
If you park your tiny house on rented land, you face the risk of having to relocate when the landowner decides to sell the land or use it for something else. By having a tiny home on a trailer, you can relocate to somewhere else if, by chance, you were forced to move.
Key Takeaway: If your landowner demands that you vacate the land your tiny home on a trailer is on, you can easily relocate without having to sacrifice your home.
Pro: Convenience for Visitors
Sometimes, tiny houses are used as guest houses for immediate family, in-laws, close friends, and other visitors. Family or friends can use a tiny house for extended periods such as an aging relative, or a close friend trying to get back on his feet. If you decided to move, a tiny house on wheels would allow you to continue housing your guest, without forcing them to relocate.
Key Takeaway: Tiny houses on a trailer that are used as a guest house allow you to have the flexibility of relocating, without forcing your guest to find new living quarters.
While the tiny house on a trailer has some attractive benefits, several downsides come with them. We’ve compiled some of the cons for a tiny house on a trailer to help show you both sides of the coin.
While safety is a pro for tiny houses on foundation, it’s, unfortunately, a con for tiny houses on a trailer. Mobility does give you the option to relocate when you know about inclement weather beforehand. When you’re unaware or not able to leave, tiny houses on a trailer pose a safety risk because they lack a solid foundation.
Key Takeaway: Tiny houses on a trailer leave you vulnerable to weather threats because they lack a foundation.
Anytime you have something on wheels it is likely to depreciate. This is true with most cars and RVs unless classified “rare” or a “classic.” When something is mobile, the chances for wear and tear increase, causing the value to diminish.
Land appreciates, which is partly why tiny houses on foundation increase in value. While tiny houses on a foundation and traditional stick-built houses often build equity, tiny houses on a trailer offer a little-to-no return on your investment.
Key Takeaway: Tiny houses on a trailer depreciate over time, offering you little to no return on your investment.
Con: Zoning Regulations
One major issue with tiny houses on a trailer is that they’re somewhere in the gray area between a home and a recreational vehicle (RV). Most tiny houses on a trailer are technically considered RVs, so parking them for extended periods must follow strict zoning and permit requirements.
Also, some tiny houses on a trailer may be classified as an auxiliary dwelling unit, subject to strict building and zoning codes like total square footage, square footage of bedrooms, ceiling heights, and more. Perhaps the trickiest part is that these regulations and requirements often depend on the size of your tiny house, and the zoning jurisdiction where you live.
Key Takeaway: Depending on the size of your tiny house on a trailer, and your zoning jurisdiction, tiny houses fall in a gray area of regulations.
Con: Needing a Truck
To transport your tiny home on a trailer to and from, you have to have something with enough towing power to pull it. More than likely, you’re going to need a reliable, heavy-duty truck. If you don’t already own a truck, this can create additional expenses by having to purchase one and keep up with the maintenance for it as well.
Key Takeaway: Tiny houses on trailers require a heavy-duty truck with towing power to transport them from place to place
For people that reside in tiny houses on a trailer year-round, you’ll need insurance that covers you while on the road, and off the road. This can often be a tricky situation because all tiny homes are used differently, as are the viewpoints of various insurance carriers.
Since most tiny houses on wheels are technically treated as RVs, you’ll need RV insurance, which varies in cost from state to state. Many insurance carriers will require a seal of approval from the Recreation Vehicle Industry Association (RVIA), certifying your tiny house on wheels meets recognized standards. The best option is to consult with an insurance provider that has experience insuring tiny houses on wheels before you make a purchase or start to build.
Key Takeaway: Insurance for a tiny house on wheels can be tricky to determine depending on what state you live in, and how you choose to use your tiny house on a trailer.
Con: Total Cost of Ownership
In the long run, owning a tiny house on a trailer can be costly compared to a tiny home on a foundation. When factoring the cost of a trailer, insurance, a truck, regulations, maintenance, and depreciation, the total cost of owning a tiny house on wheels can be higher than anticipated.
Key Takeaway: When considering initial cost, insurance, needing a truck, and more, the total cost of ownership of a tiny house on a trailer is quite expensive compared to a tiny house on foundation.
Everyone has different needs and desires, so we recommend taking the time to think about what’s best for you. Do some research on zoning regulations where you live, or where you plan to travel. Also, begin talking with insurance carriers to understand which policies and coverage will work best to meet your needs.
While we believe tiny houses on trailers are amazing and provide you with the unique opportunity to travel around the country, there are a lot of drawbacks. If traveling isn’t a must for you, we recommend looking into a prefab, tiny-home kits for foundations, a more cost-effective option and may save you from a lot of stress down the road.