Do Tiny Houses Actually Save You Money?

When Tesla releases a home battery in a year, and then Nice Architects churns out something as gorgeous as the Ecocapsule, a lot of us feel tempted to throw away our stuff and move off the grid in a tiny pre-fab home.

That voice of caution in our heads, though, deserves to be heard. Living in a tiny home off the grid sounds easy, and the pictures of that egg-shaped house in the wilderness make it look easy too, but could most people actually live in one? From space to cost to practicality, here's everything you should consider before you shell out a few (dozen) grand and buy a tiny pre-fab home.

Purchase Price

The Ecocapsule hasn’t released its price tag yet (SPOILER ALERT: Probably a f*ckton), but we’ve seen a lot of pre-fab tiny home kits for around $30k.

Obviously, you’re going to have to buy the land too, and a general rule of thumb for living off the grid is a 10-acre minimum. That’s going to cost a lot anywhere you’d actually want to live, so unless you move to North Dakota, expect to pay around $100k just for the property and less than 200 square feet of space.

According to the Census Bureau, the median asking rent in the U.S. is $799 per month. Obviously major city residents pay a lot more—ahem, $3,220 average rent in Brooklyn in April—but because a 100-square-foot apartment anywhere won’t cost much, let’s go with that figure. Assuming your rent increases five percent every year, you’ll have to live in that home off the grid for nine years before you recoup your investment, minus property taxes obviously.


Yeah, $300 summer utility bills make us want to cry every month, but not many pre-fab homes come with a built-in windmill and solar panels. You’re going to have to buy those separately, and even with tax credits a five kilowatt solar panel system will set you back $25,000, plus another $3,500 for a Tesla storage battery—plus whatever backup system you purchase, like a wind or water turbine, which can cost more than the solar panels. This isn’t even considering the cost of installing a well, rain barrels, and septic system, which Pure Energies estimates costs another $10,000.

Also, realize, you’re not just paying for electricity every month. You’re paying for engineers who design and repair the systems supplying the electricity. When it’s just you and your windmill out in the middle of Wyoming, you’re going to have to fix every breakdown yourself, or hire a specialty mechanic to drive out to your home, which can't be cheap.


When you’re growing your own food and generating your own power, you’re likely to be thriftier with electricity and waste—as long as you don’t drive those 100 miles to town very often. That composting toilet will probably help too.


Tiny homes are nothing new. Most of our ancestors squeezed a dozen kids into a hovel, and sailors have been living in tinier homes than the Ecocapsule for millennia. The costs and benefits of a tiny home, though, are really the same thing: simpler living. Ultimately it’s an individual preference.

There’s not a lot of privacy in pre-fab tiny homes, and basically no storage, so bibliophiles, cooks, and techies have to live without their libraries, ramekins, and 4K TVs. Tiny homeowners consider that de-cluttering a benefit, and outdoorsy folks like the excuse to be outside as much as possible. But living in a tiny home off the grid isn’t all gardening and lounging in hammock. Operating a homestead is hard work all year, and winters are especially tough. Cabin fever is real. If you’re stuck in a 120-square-foot home for three months straight, you could start scrawling REDRUM all over the walls before spring.


Say you learn every Little House on the Prairie skill you need to live off the grid—you still have to find a job to buy everything you can’t grow or make yourself. If you live deep in Oklahoma, or any of the states with laws amenable to off the grid tiny homes, your career options are real limited. And with chores plus the commute, you won’t have a lot of time anyway. Moving off the grid isn’t for everyone—even if you work remotely. Really, it’s just not feasible for most of us, but even if we can’t afford (or survive) living in a prefab home, we can still admire them, and wish we could.

David Michael McFarlane is a contributor at Supercompressor.

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