Tiny house companies are living large again

As the economy has recovered, so has interest in small square-footage homes. Several startups are taking advantage of Americans' big dreams for wee homes.

By MSN Money staff Mar 22, 2014 11:53AM

By Jim Morrison, Entrepreneur


Entrepreneur on MSN MoneySteve Weissmann, a California restaurateur and real-estate investor, was already living in just 400 square feet of space when he met Jay Shafer, founder of Tumbleweed Tiny House Company. Shafer was a leading voice in a growing movement that encourages people to live in tiny homes. His fledgling company sold books and building plans for complete residences that started at 65 square feet.


Weissmann so loved the stylish Tumbleweed homes that in 2007 he bought into the venture and became its president. He quickly realized that the wee company needed a big makeover. "When I joined Tumbleweed," he says, "it was more of a product than it was a business."


Tumbleweed Tiny House Company's 370-square-foot Z-Glass model. Courtesy of Tumbleweed Tiny House CompanyWhen the economy tanked, so did the Sonoma, Calif.-based company's sales. Weissmann and Shafer (who has since exited) reconfigured Tumbleweed with a focus on do-it-yourself homes. They issued Shafer's "The Small House Book," created new house designs and offered workshops across the country.


Tumbleweed has become a lifestyle choice for a diverse set of customers, from young people with a need for an affordable first home to Baby Boomers who want to downsize to those who simply want to add space, perhaps for an aging relative, by putting a tiny house in the backyard. In all, the company now offers 21 floor plans for houses starting at 117 square feet.


"When I first got involved, in my mind, it was really a niche thing," Weissmann says. "I didn't expect it to go mainstream the way it did."


Tumbleweed's workshops (priced at $239 to $399 a pop) attracted more than 2,200 attendees in 2013. But not all customers want to build their own homes; at the workshops, it emerged that many people would be interested in purchasing completed projects.


In response, Tumbleweed began building and delivering houses on wheels. In 2013, its mobile models gained national certification from the Recreation Vehicle Industry Association as park trailers, a move that helped overcome zoning obstacles and qualified the residences for financing.


Weissmann found craftsmen in Colorado to build the homes, which sell for an average of $60,000. The company sold 25 finished houses last year; between workshops and home sales, 2013 revenue topped $3 million. Weissmann expects to sell 100 completed houses this year and projects revenue of $8 million.


"Our goal going forward is to make it as easy as possible for somebody to own and build their tiny home," he says. "The RV market is booming, and I see us as the alternative RV."


Weissmann's savvy redesign of Tumbleweed's website has also been a big help. He added success stories and encouraged comments and questions from visitors curious about the transition to a tiny-home lifestyle. The FAQ was revamped to respond to questions raised by customers' e-mails. Building plans were rebranded, and the process of mixing and matching exteriors and interiors was simplified. Visits to the website grew to 4.5 million last year.


By tapping customers and others passionate about the product, Tumbleweed has been able to expand to 13 employees, though it's still housed in a bungalow. "Two years ago, this was a garage-based business," Weissmann says. "It just exploded overnight with no venture capital, which forced us to be smart about how we grow our business."


Cottage industries

Californian Kent Griswold went searching for ideas to build his dream cabin and ended up with a new career. He stumbled upon the Tumbleweed Tiny House Company site, fell in love and decided to start the tiny house blog. Within a year, he was topping 1,000 hits a day. Griswold, who had been laid off as a mortgage-bank programmer, now works full time on the blog, which gets 10,000 to 15,000 unique visitors a day. He has a healthy list of affiliates and advertisers and earns six figures from the blog and the electronic publication Tiny House Magazine, which has about 2,000 subscribers.

Dean and Marcia Harris started Connecticut-based Itsy Bitsy Ritzy Shop, which sells small-scale furniture packed with hidden storage, in 2012. The handcrafted pieces, made in the U.S., transform for various uses throughout the day; for example, a coffee table converts to a storage unit, extra seating or an ottoman.


Tiny Texas Houses, based 55 miles outside of San Antonio, builds Lilliputian homes almost entirely from salvaged materials. Founder Brad Kittel has worked in the salvage industry for three decades. He started the company in 2006 and bills his houses as both green alternatives and works of art.


North Carolina-based Andrew Odom and his wife started their blog, Tiny r(E)volution, when they were researching and exploring before building their home. He thought others might learn from their experience and created a series of how-to posts, a YouTube channel and online seminars going for $90 each. He also has forged online partnerships with suppliers of siding, roofing and other building materials who otherwise would not sell in lots small enough for builders of tiny homes.


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52Comments
Mar 31, 2014 4:24PM
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Don't we already have these?  They are called mobile homes!!

Mar 31, 2014 5:18PM
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People talking about Obama... who put us in the housing crisis, Oh we have such short memories.  That being said.  Americans have been in a consumption mode all too long.  Big companies, big media have conditioned us to live big, now that they have us, prices are rising and they can cash in.  Who really needs a cell phone plan that costs hundreds of dollars a month.  Convenience, hog wash.  Who needs to heat a huge home for 2 or 4 people.  Fuel prices have been rising a little at a time, now we accept the high prices.  Prices will rise some more, guess what, no resistance from the public, the price will stick.  This works for all consumption items.  Not just fuel.  We have become pigs, consumption pigs.
Mar 31, 2014 4:29PM
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With the way things are with our sagging economy the way it is now, I look for more American's opting for smaller and more affordable home if they can still afford to. I am seeing more people who are living in homes that are less than 1000 square feet. Didn't use to be like this.
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How about putting a leash on the population. We just take for granted that the world has and endless supply. Try walking in the shoes of the other half of the world population where in many cases their homes are made from cardboard boxes.

Appreciate what you have, you could have been born under one of those cardboad boxes.

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400 S.F. or less on semi-permanent wheels is currently classified as a "Park Model Trailer". I own one.
Mar 31, 2014 4:15PM
Mar 31, 2014 5:15PM
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"As the economy has recovered, so has interest in small square-footage homes"  Many Americans are unaware that the economy has recovered, wonder why? .  Americans this is your reward for voting for idiots the last few decades.  Hope & change we got both just not the change we were hoping for. 
Mar 31, 2014 5:48PM
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Modified Communist Chinese shipping containers are about the same size and cheaper. Since we outsourced all of our living wage jobs to China they should provide us with the containers they ship their junk over here in.
Mar 31, 2014 4:25PM
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I've got an old refridgerator box and a 5 gallon bucket for sale - $100,000.

 

"Dean and Marcia Harris started Connecticut-based Itsy Bitsy Ritzy Shop, which sells small-scale furniture packed with hidden storage, in 2012. The handcrafted pieces, made in the U.S., transform for various uses throughout the day; for example, a coffee table converts to a storage unit, extra seating or an ottoman".

 

The 5 gallon bucket serves as bathroom, storage, seating, and if you flip it over a table. For an extra $25k I'll put a tarp over the box.

Mar 31, 2014 4:20PM
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The birds of the air have a nest; but many of the Father's children have nowhere to lay their heads. Tiny homes for the homeless?
Mar 31, 2014 4:36PM
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The Obama American dream in home ownership!

 

Mar 31, 2014 4:58PM
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Sounds like the tiny homes people have in addition to their own home.  They have a relative stay, who they can look after, or rent it.  The smaller homes would cost less.
Mar 31, 2014 6:48PM
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in the dakotas where gas is booming and workers are homeless living in crates. these would be great. A small heater, a gas shower and compost toilet and you have a economic housing with privacy, the only thing more economic would be the japanese sleeping cubes with a shared bath and kitchen.  
Mar 31, 2014 4:54PM
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there is a saying that i heard thru the grapevine from a millionare lawyer... "simplicity is elegance"... i couldn't agree more. 
Mar 31, 2014 5:16PM
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We use too much space now.  We need to get outside more.  Small homes are great.
Mar 31, 2014 7:05PM
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Who the hell said the economy has recovered? The national debt is still climbing rapidly, illegal immigrants are all over the place taking our jobs, unemployment benefits are being tapped into at record rates, food stamps are being given out at record rates, gas prices are double what they were when dingleberry took office. The list goes on. Economy recovering? Please! The reason people are interested in these sheds with beds is simply because the economy is not recovering.
Mar 31, 2014 7:14PM
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obamobile?...for.when you become homeless ...just don't get caught sleeping behind some rocks in albuquerque....
Mar 31, 2014 4:56PM
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by the time King Obama is finished with us, we will all be living n a tiny home. (except for him, of course)
Mar 31, 2014 5:10PM
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While I was in California recently; I talked to some elderly people who were living in a trailer park.  Not the type of park that was open to all.  Residents have leases and annual or monthly payments.  There were several of these parks located near the beach.  These people, mostly retired, purchase these in park models of trailers to park there.  As they get to feeble to live alone, their family sells their lease for 50 or 60 thousand dollars and uses that money toward their care.  They enjoy their later years living on the beach in a home that is less than 400 sq. ft.  That is the maximum size of these in-park mobile homes.  1 or 2 people have enough room to live, nothing to spare.
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