While many people join the tiny house community to be a part of the minimalist, small-living lifestyle, there are others who are looking at this excitement as an interesting investment opportunity. That’s why we often get the question from our readers, “Should I invest in a tiny house?”

So are tiny houses profitable investments? If you know what you are doing, then yes, tiny houses can be great investments. Whether you are building tiny houses to flip and sell or investing in a portfolio of units to rent as vacation rentals or long-term leases, your return will mostly depend on how well you understand what people are looking for from their tiny house experience.

Is Buying a Tiny House Worth It?

Whether or not buying a tiny home is worth it is ultimately up to you and what your goals are with your real estate investment. There are four main ways you can use your tiny house investment:

  1. For yourself: First and foremost, you might want to invest in a tiny house just to live in it yourself. While tiny house living is generally for those who need to cut back on their monthly expenditures, there are plenty of people who can comfortably afford larger homes who still choose to build and live in a tiny home. The minimalist lifestyle appeals to many people in this age of consumerism, and having a smaller house means having fewer household concerns. If a tiny home is something you really want, then buying one is definitely worth it.
  2. Rent as a recreational property: The tiny home movement is becoming more and more popular, but not everyone is ready to throw out their mortgage or one-bedroom urban apartment and move into the wilderness in a tiny home. For many people, the tiny home lifestyle is preferable as a one-time living in a tiny home experience rather than something they truly want to adopt. You might want to consider buying or building a tiny home and renting it out for short-term leases on sites like Airbnb. Short, vacation-style rentals can offer great rental returns with the right packaging.
  3. Rent as a monthly rental: Another option when it comes to renting is as a monthly rental. For many people, tiny houses might be their only option for housing at their current budget, meaning it would be impossible to spend the $20,000 - $50,000 to build their own tiny house from scratch. In these cases, they might prefer to find a tiny house as a monthly rental. You could charge rent anywhere from $200 to $1000 a month, depending on the quality, square foot size, and location of your tiny house.
  4. Flip it: Tons of people make a fortune out of flipping traditional houses; can the same be done with flipping tiny homes? There is actually a whole established industry of tiny house flippers out there; these are professional tiny home builders who sell pre-built tiny homes with all the features and amenities you would need. This is definitely an investment opportunity worth looking into, but it requires the right team with the right specialized expertise to make it work

So is buying a tiny home worth the investment? If you choose any of the four real estate investment paths above, and if it’s something you want to do, then an investment in a tiny house isn’t a bad idea. However, there are some considerations you have to think about before moving forward with your tiny house venture.

Understanding Why Tiny Houses Have Become More Popular

Like with any real estate investment, it’s important that you do your research before spending sizable money in a project. So why and how exactly has the tiny house movement become so popular?

Tiny homes first gained slight attraction in the 80s and the 90s, but it was never really considered a movement until a little more than a decade ago, after the 2009 housing crisis. With foreclosure anxiety all around the US, thousands of people needed a new housing option – something more permanent than renting, but less expensive than a monthly mortgage of a traditional home.

The average American spends nearly 40% of their budget on housing, either through paying their mortgage or monthly rent; many Americans spend more, with some spending up to 60% of their budget on housing alone. This makes it difficult to live beyond the bare essentials, making traditional housing seem more and more like the wrong option.

The square feet downsizing and modesty of tiny homes attracted the first wave of the tiny house community. Traditional homes are simply no longer affordable to many Americans, and rental properties don’t offer the same feeling of ownership and permanence. All of these factors combined to speed up the rise of the tiny house movement.

Pros and Cons of Tiny House as Investment


  1. Many can afford the price: If you enter the tiny house market now, you are entering a seller’s market. There is more demand than supply, with many people eager to jump into the tiny house experience, whether as a full change of lifestyle or just as an exciting vacation experience. With the entry price much more affordable than a regular home, you will never find yourself short on renters or buyers, as long as your tiny house isn’t too far off in the wilderness.
  2. Management is easier than normal homes: It’s simple math: smaller house equates to fewer problems. As a landlord, it will always be your responsibility to deal with major issues in the home. But compared to a conventional home, a tiny house will have fewer and simpler issues to deal with, whether it’s with plumbing, electrical, walls, floors, or anything else.
  3. There are eager renters and buyers: As we said above, it’s a seller’s market, and unlike conventional properties in some areas, you don’t have to stick with just renting or selling. There are tons of people right now who are interested in both buying tiny homes and renting tiny homes. This means it’s the choice of what to focus on is totally up to you – both paths are profitable.
  4. Higher ROI: With a smaller investment required per tiny house, you can invest in more tiny homes with less money than if you were dealing with traditional homes. This allows investors the opportunity to multiply the size of their investment portfolio in a shorter period of time, giving you multiple streams of rental income with a smaller overall investment. You also don’t have to pay the same property taxes that you would with a regular home.
  5. It’s not a huge investment: Building an average-sized tiny house can cost you anywhere from $10,000 to $40,000; up to $100,000 if you want to give it all the works. Compared to other possible long-term investments you could make, this makes tiny homes relatively inexpensive investment opportunities. If you are a beginner investor who wants to start earning off your investment without spending hundreds of thousands of dollars on a conventional property, then a tiny house is a great starting point.


  1. Legal and regulatory headaches: The tiny house landscape is still relatively new, and with both tiny house on wheels and tiny house on foundations sharing the same name, there are still many legal and regulatory headaches that builders have to deal with to make sure that their tiny homes are compliant with both state and local laws and building codes. Learning everything you need to know in your area will take some time, meaning you can’t just throw money at this investment and expect an immediate return.
  2. No long-term guarantee: While the tiny house movement might seem like the next big thing in the housing industry right now, there is absolutely no guarantee that it will last. Remember: tiny homes have only really gained popularity over the last decade or so, and much of that is due to good reality TV shows popularizing the movement. If you spend a sizable investment in the tiny movement only for the public interest to die down in five or ten years after reality TV has moved on, you might never break even.
  3. More management than other investments: While tiny houses require less management and maintenance than conventional homes as they have less square feet, they still require more than other types of real estate investments, without yielding the same returns as renting or selling conventional homes. It’s up to you to decide if this on-hand management is worth it.
  4. Value depreciation: A major con of investing in tiny houses is that unlike normal homes which traditionally appreciate in value, tiny houses tend to depreciate in value. There are a number of reasons for this – tiny houses tend to wear and tear more quickly, tiny houses have lower costs (meaning people would prefer to build their own or purchase a newer one than buy an older one), and tiny houses are typically very personal and customizable, so buyers are more interested in finding homes that fit their exact needs. Value of your tiny home will most likely depreciate over time, making it more and more difficult to turn your expected profit.
  5. Difficult financing: If you have your investment money ready to be used, sitting in your bank account, then great – enjoy investing in the tiny home movement. But if your investment requires financing before it can be done, then you might run into a few obstacles. Financing for a tiny home is much more difficult than financing for a normal home. For example, traditional mortgages won’t work unless your tiny home is built with perfect zoning and building codes and isn’t on wheels. For tiny homes, you might want to look into personal loans (which have higher interest rates), RV loans, and even your own credit card.

FAQ: Investing in Tiny Homes

What is the resale value of a tiny home?

Unlike conventional homes which typically appreciate in value and have a greater resale value, tiny houses don’t. The average tiny home resale value is anywhere from $40,000 to $50,000. This is important even if you don’t intend to sell your tiny home – it is very likely you won’t live in your tiny home for the rest of your life, so you should know what you might get back if you try to sell it.

Are tiny houses profitable?

Tiny houses can be profitable, if you know how to build or market your homes effectively. There are many certified builders who sell tiny houses well above the standard asking price, but people tend to buy them because they don’t want to deal with the building process but still enjoy the minimalist lifestyle of tiny living. There are also many platforms for renting tiny houses for both short-term and long-term leases. Find the option that works best for you and your team to get the most out of your real estate investment.

Can you buy a used tiny home?

Yes, and this is definitely an option for investors who don’t care about customizing their own home but are looking for a quicker real estate investment.

About Us

Manuela and Ivan from Tiny House Bloom

Hey, there! We're Ivan and Manuela from Croatia, and we're crazy about tiny houses. We don't own one (yet).

This website is a result of our passion to share all the knowledge, photos, tips and tricks that we were able to learn while studying everything possible about the tiny house movement.