14 Tiny

Sep 20, 2023

Tiny homes were not a new invention of 2022, but they picked up a lot of momentum.

Whether you're a millennial or Gen Z buyer facing record-high prices, a current homeowner looking to live with less, or a city dweller whose lifestyle shifted during the pandemic, tiny homes can be filled with promise.

Elon Musk uses a Boxabl tiny home as a guest house near his Texas home. Boxabl cofounder Galiano Tiramani even shared a video on Twitter of a Tesla hauling a 15,000-pound tiny home.

Gimmicks aside, tiny homes are being used as solutions to housing crises in cities like Chicago or Bridgeton, New Jersey — where tiny homes are being used to house former inmates for free after their release. Albuquerque, New Mexico, created Tiny Home Village, which has 30 120-square-foot homes, and is being used as transitional housing and is providing shelter for people without housing.

The often-modular approach of tiny homes can help reduce construction costs and make housing cheaper. From all-electric homes to optimizing backyards in the Bay area, the future of housing may look smaller.

Tiny homes can range in price and aesthetics, but typically remain under 600 square feet. The median square footage of single-family units in America through the first three quarters of 2022 was 2,294 square feet, according to the Census Bureau.

They can also be money makers. Petite, picturesque Airbnbs are popular with Instagram-savvy travelers. In states like California, homeowners are tapping companies that plop prefabricated structures down in their backyards. In one model, a startup collects rent from the tenants of the accessory dwelling units, or ADUs — and pays out a portion to the homeowner.

We've compiled a list of the hottest tiny-home companies to look out for in 2023, all shaking up real estate in different ways. Here they are, presented in alphabetical order.

Abodu helps homeowners make use of their unused backyard space with accessory dwelling units, or ADUs. The Redwood City, California-based company, founded in 2018, promises customers none of strings some of their competitors require, such as splitting rental income.

"We don't do any sort of land lease with the owners," John Geary, Abodu's co-founder, said. "Our biggest view is that homeowners should feel free to use their backyard as they see fit and not have it tied to us as a company — or any other company."

Instead, Abodu makes its money on customers' initial purchases of its tiny homes. Studios of 340 square feet start at $228,000, though the average purchase among all its offerings is closer to $280,000, according to Geary. Abodu also offers one- and two-bedroom homes in the relatively generous sizes of 500 square feet and 610 square feet, respectively.

The company has raised $25 million, according to an August press release. Geary declined to provide Abodu's revenue but said it increased nearly five times in 2021 from 2020. It has placed 100 units in backyards as of 2022, and has more than 100 more units in production, according to Geary.

Boxabl's factory-built homes may be tiny, but the Nevada-based company is scoring big endorsements from some of the most recognizable names in the homebuilding industry and beyond.

In 2022, the company landed an investment from DR Horton — the largest US homebuilder by volume. The company didn't disclose the financial details of the deal, but Galiano Tiramani — a cofounder and director of Boxabl — said the company has now raised more than $100 million, the vast majority of which has come through crowdfunding. That puts the company's valuation at roughly $3 billion.

Boxabl delivers its 375-square-foot "Casitas," which the company builds on an assembly line in Las Vegas, to sites via shipping containers and assembles them out into full-fledged homes in less than an hour. The unique assembly method has swirled up interest on social media and helped generate a waitlist of more than 100,000 names, according to Tiramani.

Each unit sells for $50,000, not including the cost of installation. Boxabl has produced about 200 homes so far, 156 of which have gone to the Department of Defense for military housing. Boxabl is ramping up production at its existing factory and has secured land next door for an additional facility. Once both are running at full speed, they'll be able to produce about 5,000 units a year, Tiramani said.

Why rent an apartment when you can lease a tiny home? That's the premise behind the Austin, Texas-based tiny-home company Casata, which earlier this year debuted a community of 66 microhome rentals in the fast-growing Texas capital.

Residents — who pay between $1,400 and $1,865 per month — quickly snapped up the homes, which range in size from 378 to 758 square feet. Casata, which launched in 2020, is now planning larger projects in other Texas cities such as Houston, San Marcos, Bastrop, and College Station, while eyeing national expansion in the future.

Champion Homes built the inaugural Casata units in a factory near Dallas. Future Casata communities will feature custom floor plans Casata designs and use modular construction, Aaron Levy — the CEO of Casata — told Insider. This means Casata will still build them in a factory, but the homes will sit on foundations like traditional homes and meet the same building codes required for homes built on-site.

Casata has raised roughly $2.1 million from a range of investors, including the family office of Adam Neumann — the founder of WeWork. In the next five to seven years, Casata aims to have 30 to 40 communities, which would equal a roughly billion-dollar portfolio, Levy said.

This San Francisco-based startup creates accessory dwelling units equipped to generate enough energy to power themselves and supply energy to the property's main home. The company, which founder Sasha Jokic began in 2021, currently sells two styles: A studio starting at 350 square feet and $190,000, and a one-bedroom unit starting at 450 square feet and $370,000.

Cosmic's innovation is a prefabricated platform that draws its power from a lithium-ion battery and thermal energy. Cosmic constructs the carbon-neutral units on-site with sustainable materials once the platform is in place. From start to finish, it takes from six to eight months to create a Cosmic dwelling.

Although the units are small now, Cosmic envisions scaling up. "We'll consider ourselves successful once we tackle the problem of housing insecurity with the multifamily homes," Jokic told Insider in May.

Cover has a premise. Companies today use an outmoded method to build homes, and they can apply technology they use to design, create, and predictably price products — like cars — to residential construction. Cover has gathered followers and has raised a total of $73.3 million over four rounds through 2021, according to Crunchbase.

Cover customizes its backyard dwellings to each buyer and manufactures them in sections at its Los Angeles factory before assembling them on a dedicated site. According to Tech Crunch, the homes currently max out at 1,200 square feet with prices ranging from about $200,000 for a 400-square-foot studio to $500,000 for a three-bedroom house.

The production process is swift, taking about 30 days to build and install a home once Cover completes the foundation. As of October 2021, Cover had produced about 20 dwellings, though it expected production to ramp up after moving into its new 100,000-square-foot factory.

Robots might, one day, build your home.

At least, that's if San Diego-based Dvele achieves its lofty vision. The company, which builds modular homes and assembles them on-site, announced in June the closing of $15 million in funding to build an automated, robotic production line at its factory in Loma Linda, California. The idea is to give people the opportunity to personalize their home online, then feed orders to the smart factory, and transport the completed modules — essentially the building blocks of the home — to their permanent site.

Dvele doesn't just focus on tiny homes, or "mini homes," as the company calls them. Its floor plans range in size from 400 square feet to more than 3,900 square feet, and prices vary between $200,000 and $1.5 million. That doesn't include the cost of prepping the site, delivering the home, and installing it once it's arrived.

The company launched in 2018 and plans to produce about 200 modules this year, Kellan Hannah — Dvele's director of growth — said. While the mini homes require just one module, the larger ones are made of between three and five modules. Once the factory is totally automated and running at full capacity, the company's production should approach 1,500 modules annually, Hannah said.

For now, the company is mostly focused on delivering homes to California and neighboring states due to shipping costs, Hannah said.

Escape Homes of Rice Lake, Wisconsin, has been selling tiny homes since 2014, but business has never been this hot.

"The pandemic was gasoline on the fire," Dan Dobrowolski — the founder of Escape Homes — told Insider.

Urban dwellers searching for greener pastures joined a movement that Dobrowlski says has been building across demographics and age groups. He's seen this in every region where Escape has built homes as large as 388 square feet over the past 8 years, from California to New York, and even in Hawaii. The cost of the homes runs from about $43,600 to $93,261.

As the pandemic deepened in 2020, Escape teamed up with the furniture giant IKEA to develop the outlet's first tiny-home offering. The 187-square-foot unit was Escape's Vista Boho XL model outfitted with IKEA furniture, and available through its website. Dobrowolski says the partnership was a "really easy match," with both companies aligned on environmental issues.

In other sustainability efforts, Escape has introduced some all-electric models. Other models were already close to being all-electric, but changing out cooking appliances, water heaters, and furnaces brought them to the next level, Dobrowolski said.

Escape is also trying to transform neighborhoods. In 2020, the company opened its Escape Tiny Home Village — a cluster of 10 homes in a converted Tampa Bay, Florida, trailer park. The homes only take up about 20% of the acreage, leaving room for ample green space. Dobrowolski calls it a "neighborhood of the 21st century."

"It's a much more efficient use of space, but at the same time gives you what people still think of as the American dream," Dobrowolski said.

This tiny-abode-hospitality company based in Cambridge, Massachusetts, has created nature-filled experiences without common amenities like WiFi or TV in an effort to help people — especially big-city dwellers — unplug.

At a base price of $109 per night, guests can stay in these tiny homes in 19 outdoorsy environments from Shenandoah National Park in Virginia near Washington, DC; to Mount Vernon, Washington, near Seattle. The 780 cabins of up to 200 square feet are stocked with bedding, cooking supplies and an outdoor-camping setup.

"Growing up in rural Minnesota I was always surrounded by nature," Jon Staff — a cofounder and the CEO of Getaway — said. "When I returned to nature later in life, I fell in love with the idea of living simply in nature and making frequent disconnection part of my routine."

The company announced in June that it would add 9 new locations including places in Indianapolis, St. Louis, Cincinnati, Columbus, Ohio; Greenville, South Carolina; and Milwaukee, Wisconsin. The expansion would boost Getaway's offerings to 1,000 cabins.

In 2021, Cerates led the startup's Series C funding, in which Getaway raised over $41 million.

Founded in 2017 in Austin, Texas, Icon has dominated the 3D-printed-housing market with technology that has brought over 24 homes to the United States and Mexico — the largest number of such structures completed by a construction company. It has so far raised $451 million from investors.

In 2021, the company worked with an Austin-based developer who brought a version of its 3D-printed home to market with prices starting from around $450,000. Others are eyeing the company's technology as proof-of-concept for affordable and emergency-housing communities of the future.

Icon is now expanding the scope of its operations in collaboration with the United States Army to create moveable training barracks that, once completed, will count as the largest 3D-printed structures in the Western Hemisphere. The company is also working with NASA to develop construction systems to create infrastructure and habitats on the moon and beyond.

Quebec City-based Minimaliste builds and transports tiny homes specifically designed for the climate surrounding the designated plot of land they will sit on.

Founded in 2015, Minimaliste gained popularity for prefabricated tiny homes that are able to withstand wild weather conditions — from extreme heat to frigid temperatures — by regulating the temperature inside the tiny home with efficient heat pump and air conditioning systems.

Unlike most tiny homes, Minimaliste homes come with a heat pump and air-conditioning system.

Minimaliste has built over 100 homes, though scaling up is not the company's goal, JP Marquis — a cofounder of Minimaliste — told Insider. Instead, it's focused on process, or making sure steps such as choosing materials, design, and delivery go smoothly, he said.

"We invested a lot in the recipe," he said.

Customers can buy Minimaliste's custom homes of up to 382 square feet, or choose from one of the company's pre-designed layouts such as Nomad, a 165-square-foot home with a minimalist design for about $65,000.

Most Minimaliste clients are based in New York, California, Washington and Ontario, Canada, but it's getting increased interest from people in southern US states such as North Carolina, South Carolina, Texas, and New Mexico, Marquis said.

Moliving is introducing luxurious, sustainable, and affordable hospitality experiences to the tiny-house movement.

The New York-based company has a fleet of prefabricated 399-square-foot trailers with additional deck space. It can expand or shrink the supply to meet seasonal demands, which helps lower the cost of the luxury digs, Jordan Bem — one of the company's cofounders and the CEO — told Insider.

The first location for one of Moliving's mobile hotels will open during peak tourist season later this summer in a lush, mountainous hideaway in the Hudson Valley town of Hurley, New York, Bem said. It will have 60 suites starting at about $249 per night, he said.

But when the weather gets cold in New York, Moliving will simply take its accommodations elsewhere.

"We take our suites, and trailer them to the next destination, something that is perfectly opposite, like Palm Beach, for example," Bem said.

The nomadic business model eliminates off-season expenses, such as shutting down for a few months, or costs associated with climate, he said.

Bem invested nearly $7 million into the business, which recently closed a seed round of funding — which the modular investor SG Blocks led — in June, he said. In 2022, Moliving won the American Business Award for startup of the year in business services, and a Titan Business Award.

David Latimer founded bespoke tiny-home outfit New Frontier Design in 2015 in Nashville, Tennessee, out of a desire to perfect a product from the design phase through to completion.

The detail-oriented craftsman builds highly customizable tiny homes that he told Insider are mostly purchased by clients in Western states like California, Washington, and Idaho. Latimer said his clients often use his product as a luxury solution for the hurdles associated with building on remote properties, such as restrictive permitting issues and high construction costs.

New Frontier counts Olivia Wilde among its all-star client roster, as well as "some of the wealthiest people on earth," according to Latimer. The company's tiny homes range in size from about 250 square feet to 450 square feet with prices sometimes exceeding $350,000.

Latimer estimated he's built 60 to 70 highly customized homes to date. An added bonus in the tiny-house space for Latimer? "It's a vehicle for intentional living," he said. "You can't mindlessly consume." The space constraints simply won't allow for it.

The OBY Cooperative gets its name from the development debates between NIMBY (Not In My Backyard) versus YIMBY (Yes In My Backyard) camps. OBY instead stands for "Our Backyard" and imagines a future beyond the debate.

"It doesn't have to be yes or no, but just the understanding that collectively all of this land is ours," Declan Keefe — a cofounder of OBY Cooperative, in Oakland, California — said.

OBY is in the process of establishing its first unique land-lease agreement with an owner and a tenant.

The cooperative seeks out homeowners who want extra income from an accessory dwelling unit, and pairs them with tenants who are utilizing housing vouchers. It aims to ink 35-year agreements under which it permits, builds, manages, and maintains the ADUs of about 650 square feet on residential properties, at no cost to the homeowner. Homeowners can earn around $500 a month for the rental.

A unique element of the cooperative is a plan to eventually sell shares of the rental unit to other members of the community.

OBY is also tackling sustainability. The unit itself is all-electric and runs on net-zero energy. Even the construction process is carbon neutral and powered by solar energy.

Keefe said the first tenant is expected to move in within the coming months. The homeowner has been an active participant in the endeavor, leaning on a legal background to help them draft equitable contracts, he said.

Steven Dietz — the founder of United Dwelling — thinks he has a solution to Los Angeles' housing crisis.

After a career in venture capital, Dietz wanted to make an impact on his community and in 2019 decided to tackle housing affordability through increasing attainable inventory. His team started by transforming garages, but found them to be inadequate.

In part, a 2019 California state law that streamlined the construction process of ADUs made Dietz's vision possible. United has so far built 60 homes, with 300 more in the permitting process, according to Dietz, who said their sizes range from 328 square feet to 1490 square feet. The homes start at $195,900, including demolition and design, permitting, and solar water and power systems.

"I can see a way we get to where affordability is removed as a problem in probably five to seven years," Dietz told Insider. "You just have to build enough new homes to pull down the price at the low end of the market."

Dietz says units have been filled by working-class people who were suffering through brutal commutes. Teacher's aides, EMTs, and nurses who were driving over two hours to their jobs are now just minutes away.

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