Tiny houses – barely bigger than a walk-in closet in the supersized McMansions that symbolized the excesses of the 1980s and 1990s – are catching on across the country. But unlike those giant houses bloated with rarely used rooms, pretentious furniture, and lots of “stuff,” tiny houses have extremely compact quarters – anywhere from 100 to 500 sq. ft. – and fit only the bare essentials.

The homes can be built on a solid foundation or on a trailer with wheels like a luxury RV for mobility and relocation possibilities. While efficient design is a hallmark of all tiny homes (think stairs that pull out to reveal storage, and a tower of stacked storage cubes that convert to seating), the niceties can range widely.

In some, quality construction, luxury amenities, state-of-the-art appliances, and access to utilities, are akin to those in a traditionally-sized home, only on a smaller scale. Other tiny homes are scarcely a step up from camping, with off-the-grid living and few modern comforts or conveniences. But at both ends of the spectrum and everywhere in-between, people are embracing the tiny lifestyle.

Five years ago there were no more than 200 tiny homes nationwide; today there are approximately 10,000. Spur, Texas, was reportedly the first tiny-home-friendly community in the country (ironic, considering the state’s “Everything’s Bigger in Texas” motto). It was the first town to eliminate minimum size requirements for homes on foundations, and the first to permit mini houses on wheels, in an attempt to attract tiny-house enthusiasts to help revitalize the town and reverse a declining population.

Although zoning restrictions in many municipalities prohibit tiny houses, other areas are re-examining zoning laws in response to growing interest in the movement. In 2015 alone, about 30 new micro-house communities were added to a growing list throughout the U.S. and Canada (for a comprehensive state-by-state roster, visit TinyHouseCommunity.com).

Helping to spread the word are the numerous blogs, Pinterest boards, and online forums devoted to the subject, as well as conferences, seminars, and DIY workshops. There are even television shows, including Tiny House Nation airing on the FYI Network, and Tiny House, Big Living on HGTV. More builders are realizing there’s big business in small houses and specializing in tiny homes. According to an article in Builder magazine online, after one suburban Chicago builder gave up his kitchen and bathroom remodeling business to focus on tiny houses, he sold 15 tiny homes worth $500,000 in sales in just four months, and now fields 20 or so new inquiries a day.

A Lowe’s Katrina Cottage.

Tiny Retirement model from Tiny Home Builders.

Who is Living in Tiny Homes?

Most tiny homes are single-person households, although a growing number of couples and families are giving it a try. According to the American Association of Retired Persons (AARP), two out of five tiny homes today are being built for people aged 50 and over looking to downsize and simplify their lives in retirement.

These Baby Boomers might live in their tiny home as an “Accessory Dwelling Unit” (aka, in-law suite or “granny flat”) in the backyard of an adult child’s home, or use it as private living quarters for a home-health caregiver, or to create a family compound on vacation property where each child’s family has a private cabin.

Sometimes seniors own more than one tiny home – for instance, one in a warm-weather spot and another near children – or they might trailer their tiny home to different locations throughout the year.

One company, Tiny Home Builders, even offers a model targeted to seniors called “Tiny Retirement,” designed to be all on one level and eliminate the need to climb a ladder to sleeping quarters in a loft, as is the case in most tiny home designs.

Millennials – 34 percent of whom say they would definitely, or would seriously, consider living in a tiny home – are also helping to drive the movement. “Millennials want a home, but they’re not going to mortgage their life away like their parents did to get one,” says Susan Yashinsky, vice president Innovation Trends for Sphere Trending. “For them, a tiny home is a viable option because it’s an affordable way to buy a home and realize their aspiration.”

In some areas, tiny houses are being used as an effective and relatively inexpensive solution to the affordable housing crisis and homelessness. Opportunity Village in Eugene, Oregon, is a community of 30 80-sq.-ft. homes where the formerly homeless residents share a common kitchen, community space and bathrooms.

In Oakland, California, abandoned shipping containers were converted to tiny residences for the homeless, and micro homes were used in New Orleans as temporary housing for displaced residents after Hurricane Katrina. TinyHouseCommunity.com maintains lists of other communities for homeless people in need, including those specifically designed for homeless veterans.

A living area from Tiny House Nation.

Why Tiny?

According to TinyHouseTalk.com, one of the biggest motivators is reducing expenses and debt and, in turn, gaining financial freedom to explore interests, travel, or participate in other experiences. According to The Tiny Life blog, many Americans spend one-third to one-half of their income on housing. The median sales price of existing U.S. homes is $232,500 for existing U.S. homes, and $321,100 for new homes, according to the Census Bureau (plus $200,000 to $300,000 more in interest over the life of a 30-year mortgage at today’s rates).

Comparatively, a tiny home costs an estimated $23,000 for a DIY build, and about double that when it’s constructed by a builder. A recent listing of new and used tiny homes available for sale on the Tiny Home Builders website had prices ranging from $13,500 to $59,000.

It’s no surprise then that 68 percent of tiny-home owners own their home outright with no mortgage, versus 29 percent for owners of standard-sized homes. In addition, costs for utilities, taxes, maintenance and furnishings are also considerably less. So it’s clear why the appeal is real.

John Weisbarth, co-host of the show Tiny House Nation, says U.S. salaries have not kept pace with the rising cost of housing, and people’s attitudes are changing about what is important in a home. He says many are no longer willing to buy into the vicious cycle that often accompanies buying a big house: “You have to work all the time to be able to afford it, but you can’t enjoy it or spend time with your family because you’re working so much,” he says.

Reducing living expenses allows people to enjoy a better quality of life no matter what stage of life they’re in, according to Weisbarth’s co-host Zack Giffin. “A house should facilitate your life, your life should not facilitate your house,” he says. “It’s all about financial freedom.”

A desire to simplify and downsize is another big factor behind the movement. Purging unnecessary possessions is a challenging but liberating feeling for many tiny house enthusiasts, as is the significant reduction in housekeeping and maintenance chores.

People also adopt a tiny lifestyle as a way to reduce their environmental footprint. A tiny house uses much less energy, creates less waste, reduces the impact on the water system, and produces fewer emissions (a tiny house produces about 2,000 lbs. of carbon dioxide emissions annually vs. 28,000 pounds for an average house). Some tiny-home owners even opt to go off the grid entirely, thanks to solar panels that generate electricity, composting toilets, rainwater harvesting systems, and other efforts.

A tiny house powered by solar.

This is a philosophy and lifestyle that people are highly passionate about. When comedian and television talk show host Steve Harvey recently dissed tiny houses as “stupid,” he received a firestorm of angry emails and social media messages scolding him for his small-mindedness. Impressed after being educated on the subject, he ultimately devoted a lengthy segment to tiny houses on his show.

Still, the tiny-house movement is very small, according to Yashinsky, but interest is growing. “It represents a rebellion of sorts,” she says. “People are rebelling against paying 40 or 50 percent of their income on housing, and against having stuff for the sake of having stuff.”

Indeed, the tiny house movement is challenging a six-decades-long trend in which house sizes have increased. According to the U.S. Census Bureau, the average size of a new home was 983 sq. ft. in 1950; today it’s 2,600 sq. ft.

But while most new construction is still focused on large homes, Yashinsky says builders are missing the bigger picture. She points out that although not everyone is ready to live in a 400-sq.-ft. house, an increasing number of Americans are looking to downsize and live “smaller.”

“Four out of five homes sold today are smaller-sized homes,” she says. “There is an inventory shortage of small homes at lower price-points. Builders are ignoring the 87 million Millennials and Baby Boomers who want small homes.”

With a shortage of small houses, many seeking to downsize are opting for apartments or condos in urban areas. While most apartments are already smaller than an average house, Carmel Place, New York City’s first micro-unit apartment complex, takes it one step further.

Opened this year to tremendous response (nearly 60,000 people submitted applications), each of the building’s 55 studio apartments average about 300 sq. ft. Fourteen of the apartments were designated as “affordable housing” with $1,000 monthly rent, versus $2,750 per month for the rest of the units.

All the apartments have open floor plans and high ceilings with extra-large windows to create the feel of a larger space. Some units come with multifunctional furniture that morphs from one use to another (for example, the desk expands into a full-size dining table when entertaining guests). Shared amenities in the building include a fitness center, an outdoor “sky terrace” with an adjacent indoor lounge space, a small garden, and optional butler service offering weekly housekeeping, laundry and grocery shopping.

All the comforts of home, including a front porch, at Community First, a village of tiny houses, recreational vehicles and canvas-sided homes in East Austin, Texas.

Interior of a tiny home from Tiny Home Builders.

The Importance of Outdoor Living

According to Kerri Fivecoat-Campbell, author of Living Large in Our Little House: Thriving in 480 Square Feet with Six Dogs, a Husband, and One Remote – Plus More Stories of How You Can Too, when indoor space is tight, porches, decks and outdoor living areas become especially important. Not only do these areas extend usable living space, often they are the only areas large enough to entertain guests at a tiny house.

“As the house gets smaller, the outdoor living space compensates,” says Yashinsky. “That sense of seamless living is very important to living more comfortably in a small house.”

Some in the barbecue and outdoor living industry are beginning to take notice of this small-living trend. Coyote Outdoor Living has introduced a compact outdoor kitchen targeted to empty nesters and small households. The five-ft. stucco island is delivered fully assembled and finished and includes a 36-in. grill, refrigerator, access doors and granite counter.

“It’s very functional, fits great on a 10-by-10-ft. patio, and is a really nice set-up,” says company president Jim Ginocchi. “At $4,000 it’s very affordable and it looks so much better than a grill on a cart.”

The Outdoor GreatRoom Company offers the Bistro Cart, a compact and mobile grilling station with granite counter top and black-glass cabinet doors. It can hold a Cook Number electric grill or be used as a bar or serving station, and is ideal for apartment balconies and other small spaces.

The company also recently introduced the Intrigue fire feature that operates on a one-lb. LP cylinder and fits into a standard umbrella hole in a patio table. “It can be used in multi-level properties, so it’s good for condos and apartments,” says Ross Johnson, OEM National Accounts Manager.

Sunset Bay Outdoor and Kenyon International have teamed up on the Metro, a compact outdoor kitchen designed for small spaces. The Metro retails for $3,995 and includes a powder-coated, rust-proof island that is delivered by UPS completely knocked down, and can be assembled with thumb screws – no tools needed. It comes with a choice of weather-tight access doors or drawers, solid-surface countertops, and a Kenyon stainless-steel electric grill that plugs into a standard 120 volt outlet and reaches temperatures up to 600 degrees.

“This outdoor kitchen is ideal for apartment or condo living, for retirees, single households and small households,” says Mike Williams, Grill specialist with Kenyon International.

Tinywood Homes creates a variety of homes. This one sleeps six and has a log-fired hot tub and a covered barbecue/dining area.

The new Wall Mount Barbecue from the Australian company Smart, features a clever, space-saving, fold-away design. The electric grill mounts to an exterior wall, extends when needed for cooking, and then folds down flush against the wall and out of the way when not in use. The grill’s lid flips up and acts as a barrier to protect the wall from splatters and smoke. The system retails for about $1,000, according to managing director Simon Taylor, and is designed for condo and apartment balconies where space is at a premium.

Bull Outdoor Products offers a variety of outdoor kitchens designed for compact spaces, including the Little Q, Luxury Q, Master Q, Patio Q, and Power Q. The small-footprint islands range from a simple, five-ft. linear grill surround, to an L-shaped island that holds a grill, refrigerator and seating for three or four.

Big Box stores are beginning to recognize the small-living trend. This past spring, Target had a campaign called “Small Space Outdoor Living,” encouraging shoppers to “Live it up on your balcony or small patio!” The promotion highlighted two-burner grills, foldable or stackable outdoor chairs, and a small-footprint balcony bar with stools.

The first retail store for “balcony decoration,” De Balkonie, recently opened in Amsterdam, where, according to owner Friederike Joppen, 70 percent of houses have a small balcony. The store specializes in compact furniture, accessories and plants to fit urban balconies.

Might something like that work in the U.S. and Canada? Tiny-living experts are betting the answer is “yes.” Manufacturers and retailers of barbecue, hearth and outdoor living products would be wise to start thinking small, too. It might just produce big results.