Growing Business in Tiny Houses
A handful of successful businesses across the state have sprouted to serve the fast-growing market for small, affordable houses.
Channel surfers the world over are learning it’s difficult to scroll through television network offerings without landing on channels about flipping properties, renovation or DIY tips. And FYI network has capitalized on that trend with a production known as Tiny House Nation, a show devoted to shrinking the box in a way that goes beyond the garden home concept — scaling back big time, as it were. The market for diminutive houses is fast becoming behemoth, and Alabama builders and innovators are embracing the trend.
In 2006, Mark Blankenship, of Ozark-based Blankenship Construction and a former Ozark City Council member, began building small houses from a sense of civic responsibility to revitalize the downtown area. Blankenship was confident that if affordable rental properties were available within walking distance of downtown, they would be in demand.
Drawing inspiration from his admiration for New Orleans shotgun-style houses, he drew up two practical home designs, varying front elevations to add interest, and broke ground on a row of 13 tiny homes in 500 and 1,000-square-foot floor plans. Front porches and back porches add an element of charm reminiscent of old-fashioned neighborly interaction, and the properties were quickly at full occupancy.
With his construction career on hiatus while he serves as Dale County Commission chairman, Blankenship is confident his business model is one others will emulate. He routinely receives requests from potential homeowners nationwide who want to purchase the plans.
“These are sturdy structures made of hardy plank and shingle siding with metal roofs,” Blankenship says. “A lot of people wind up living in assisted living or apartments later in life. This gives you a compact unit, but it’s your own house, and that’s popular whether you’re young or old. With your own space, you don’t have to worry about rowdy neighbors.”
Blankenship says several people have left more traditional assisted living to move into the true independence of having their own, albeit smaller, dwelling.
“I believe the future is bright for small houses due to cost and because this generation has interests other than doing yard work, maintaining large homes and paying large energy bills,” Blankenship says.
While he has sold some of the larger structures for $115,000 to $120,000, he retains ownership of most of the houses, easily renting them for $500 a month. Stylish but practical, Blankenship chose all stained concrete floors, stainless steel appliances and rolled formica countertops.
On the ground floor of the diminutive housing trend was Auburn University’s Rural Studio, the school of architecture’s nonprofit program, which assists low-income families in Alabama’s Black Belt.
“It was started in 2005 because we were interested in finding better ways to design and build homes for people in West Alabama,” explains alumna Natalie Butts-Ball, communications and 20K Home project manager. “In the South, we often see trailer parks, but our idea was to create a better alternative with a beautiful, small, efficient house that would appreciate in value and provide better living accommodations.”
From the initial mission, architecture students in the program have designed at least one micro home a year.
“Our goal with the 20K home is to build quickly and affordably by keeping the labor costs down,” Butts-Ball says.
After a series of field tests, ultimately, the Rural Studio plans to introduce its product line to the market, allowing the public to access the designs and build their own dwellings. For those on fixed incomes, it’s a difficult deal to beat, with the proposed model home crafted from $12,000 in materials and $8,000 in labor.
Rural Studio’s homes are designed for comfort even without air conditioning, a feature that cuts utility costs to the minimum.
“Even without air conditioning, the homes are quite comfortable, because they are designed with taller ceilings and cross ventilation,” Butts-Ball says. “By lifting the house off the ground, we keep them well insulated. These are very tight little houses; that helps them to be efficient without air conditioning, a foreign concept to Alabama.”
Rural Studios’ 20K homes aren’t often in the spotlight — not because of their small stature, just 500 square feet — but because of the remote areas they target.
“The houses we typically build are off the beaten path,” she explains. “But a lot of people are starting to learn about them, and the demand has been tremendous. We began working on them as a way to help support affordable housing in rural areas, but now they are desired by a lot of different types of people — a mother-in-law cottage, a second home on a lake property. There’s a large audience.”
Pye Parson, an associate broker with E21 Realty, is squarely in that demographic. Her brother-in-law, Bruce Lanier of Standard Creative Builders in Birmingham, partnered with her in creating a design for a Tiny House Nation episode that brought the house plan to prominence.
The vision she proposed was to reclaim her family property in Waveland, Mississippi, a casualty of Hurricane Katrina that prompted the Parsons’ move to Birmingham. With her family settled in a new city, she proposed building a small-scale home as a retreat for sentimental journeys back home.
“When you talk about tiny houses, people get in their head that these are really small, but with 500 or 600 square feet, they’re the answer for a whole generation,” Parson says. “Young people in their 20s can’t afford to buy houses, and people retiring usually need one level. These fit both needs. There are too many properties in the land bank, just sitting there.”
Working in real estate, Parson hears firsthand the demand for affordable dwellings for up-and-coming college grads.
“Most young professionals who want me to help them find a home want to be outdoors on a bike or hanging out in a restaurant or bar,” she explains. “They want comfortable but cozy. I think small living is the answer.”
When Parson and Lanier tackled the design for the Mississippi property, they began with her vision for an idyllic family retreat situated under a magnificent oak tree and surrounded by hardwoods and pines.
“I wanted open and airy but small,” she says. “I let Bruce run with it. He spent three days working 24 hours a day and came up with a 24x24 cube design. It gives you a feeling of much more volume in a cube as opposed to a rectangle. The ceilings go from 12 to 19 feet high. That also makes it feel open. It’s the perfect place. I call it ‘not so tiny.’”
The Parsons opted for a mere 576 square feet in what the show called “Mississippi Memory Home.” After overcoming zoning issues, no small feat, the house was built. Lanier’s exposure in Tiny House Nation has led to a great demand for the houses.
“He gets a ton of requests, and it has taken on a life of its own,” Parson says. “I get emails all the time from people all over the world who want Bruce’s information.”
Doug Schroeder, owner of Timbercraft Homes in Guntersville, agrees with the prospects for tiny home construction. He began his business in 2014 after being in traditional home construction for years and actually sold his first tiny house on Craig’s List.
“I was always intrigued with small buildings and ended up deciding to try it a year and a half ago,” Schroeder says. “The second couple who came to look bought it. Once I sold the first one, I had orders and decided to jump in and build a new shop.”
In the tiny house business, Schroeder decided it was go big or go home, leading to a 5,000-square-foot shop where he crafts the buildings. All are mobile, though some are built on skids with prices ranging from $40,000 for an 8x20 or $48,000 for an 8x24.
“Some people are interested in buying them for B&B rentals, some for in-law suites, but for most, the primary reason is to live in,” Shroeder says. “I’ve sent one to Mississippi, one to California, and I’m starting one that goes to Florida.”
From conception to completion, construction time is approximately three months, depending on customization. Weather delays are not a factor with indoor construction.
“The beauty of this business is listening to the client and finding out what they want or value,” Schroeder says. “I draw up and send the plans for review and then build it. No two are alike.”
Schroeder often installs pine slab countertops and floors, which give a semi rustic aura, while the buyers make decisions such as choosing a light fixture and shipping it to him for installation. It’s a competitive industry, and his market is nationwide.
“I have a lot of builders who want my plans, but if they are in Tennessee or Ohio, they are still my competition,” Schroeder says.
The parameters for rolling homes are 13.6 feet tall and 8 feet wide, or homes on skids can measure up to 14 feet wide and 30 feet long, requiring specialty movers. For the larger structures, it’s cost prohibitive to transport as far as the West Coast, but the smaller structures can be relocated economically.
“I’ve been very surprised at the response I’ve gotten,” Schroeder says. “I never dreamed it would be that big of a deal. This is a big movement, and I think it’s here to stay, but still new enough that it gets attention.”
The majority of Schroeder’s business comes through website traffic. When he launched his venture, he was savvy enough to invest in a web designer to create an eye-catching site. “My website hit in August, and by September, I had 37,000 page views,” he says. “I was shocked. I get emails and calls every day.”
Co-owners Jesse and Patricia Lett of Jigsaw Homes in Evergreen had a two-fold inspiration for launching their business. First, they couldn’t find a well-built shed for themselves. Second, they knew of a family who converted a shed of treated lumber into a home.
“When we found out people were actually living in sheds, our first intention was to build a better product that could be modified,” says Lett.
The Letts’ structures are built to comply with hurricane safe construction standards and can withstand 159-mile-per-hour winds. They spent two years building a factory to make the homes, and for the past six months have been manufacturing the sturdy shells, the largest of which is 16x40. That size can comfortably accommodate a two-bedroom, one-bath home.
Putting together the product takes just over two days, and setting them on a foundation takes the same amount of time. The cost for the larger structures is $12,000, and Lett points out there’s room to grow with his company’s product.
“We called our company Jigsaw, because you can take these cubicles and put different components together to create whatever size unit you want,” says Lett, who is quick to point out he is building structures, not homes. “We wanted to stay in a range low-income people could afford to convert. Our flagship product is 14x40 for $10,000. We take orders on the type of material and roof, so if you are a single person who buys one and your family grows, you can get another one to add on. The structure can grow with your wallet, and it is designed to look like you haven’t added on. We wanted to build these structures for people who couldn’t afford conventional houses.”
“Our first idea was to put something on the market that was safe in materials and in structural soundness and see what it would do,” said Lett, who is sending seven units to Mobile. “By structure number 10, we expect things to be running very smoothly. More and more people are learning about us through word of mouth. We’re just getting started and are already growing.”
Cara Clark and Tyler Brown are freelance contributors to Business Alabama. She is based in Birmingham and he in Huntsville.