Tiny Houses have taken Australia by storm in recent years, as people look to more affordable and sustainable housing options. These cosy dwellings have also captivated investors as an opportunity to generate income. So when it comes to looking for a new investment opportunity, are Tiny Houses a good investment? In this blog, we will explore the various factors to consider when evaluating the investment potential of Tiny Houses.
Here are some potential advantages of investing in a Tiny House:
- Cost-Effective
The outlay involved in buying or building a Tiny House is significantly less than a traditional dwelling, resulting in a much smaller price tag. This means that paying off any debt involved will take less time, thus generating a return on investment and allowing for financial freedom sooner than other property investment ventures.
- Reduced Maintenance and Operating Costs
With less space to maintain and clean, you’ll see savings in both time and money. The key savings factor to consider is reduced heating, cooling and electricity in comparison to a traditional home.
- Generate Rental Income
Renting out your Tiny House as short stay accommodation can be a lucrative opportunity for many. Websites like AirBnb make it an easy and convenient experience to list your Tiny Home as a short-term rental and manage your listings.
According to Different.com.au, renting out a Tiny House worth $80,000, 30 times a year will bring in a gross rental yield of 5.6% in comparison to a $500,000 home bringing in a rental yield of 4.1%
Fredstinyhouses.com.au projects that the potential for generating rental income will continue to grow at approximately 3% per year in nightly earnings. This would bring in a 10.28% ROI in 14 years, assuming you’re only renting out your Tiny Home for 28 days per year (which is likely not the case). The numbers speak for themselves!
- Flexibility
As Tiny Houses are mobile, this allows the opportunity to move your Tiny House wherever you please. Moving interstate? Purchased a new investment property? No problem! Mobility adds a strategic element to your investment, as you can adapt your location according to changing market conditions.
- Environmental Benefits
Although Tiny Houses are considered a vehicle, and will therefore often depreciate in value overtime, the environmental benefits have the potential to increase their overall resale value. Tiny Houses often incorporate eco-friendly materials and also reduce your carbon footprint, appealing to a sustainably conscious market. As society continues to place greater emphasis on minimising our environmental impact, the resale of Tiny Houses with sustainable features may increase, making them a good long-term investment.
So, are Tiny Houses a good investment? If you’re looking for an affordable, flexible and sustainable property investment then look no further! Their potential for generating rental income and saving on initial costs as well as maintenance expenses overtime in comparison to a traditional house make them a great investment option.
If you’re considering investing in a Tiny House and want to explore your options, please contact our team today!
