Your Passive Income is no longer a dream.
In our previous blog, we gave you ideas about Tiny Home living. About the places where you may feel very welcome for owning one and not be discouraged by overwhelming rules and regulations.
Tiny House living allows you to have more time to enjoy or have more time for your hobby. A Tiny House also lets you enjoy relatively more disposable income because of lesser expenses. Over time, you may realize fewer expenses on utilities like water and electricity, mortgage, and home maintenance. There will also be relatively fewer needs for furnishings.
Let us say you want to downsize and live in a Tiny Home but can not find one good solution, or you want to maximize the income opportunities owning Tiny Houses can give you. We may have the solution you are looking for, so read on.
Tiny Houses Let you Earn More from Less
You can have a Tiny House now and start earning. If you have a respectably sized backyard in your primary residence, you can have a Tiny House built right in your property that you can list as a home rental that you may even get to enjoy between tenants.
Short Term Stays
If you are not keen on having long-term stays, you can list your Tiny House on various rental platforms like Airbnb, FlipKey, TryItTiny, or HouseTrip, to name a few examples. Additional Tiny Home income derived from listings ranges from $20,000.00 to about $50,000.00 per year. A sizable sum of money for what is considered passive income. To inspire you more, dig into success stories like this couple who were able to earn $21,000 within a year of listing their Tiny Home. They did have some unforeseen expenses because of some guests, but the overall experience was more positive. Another encouraging story is this guy who’s earning $54,000 a year net in his recently built Tiny Houses.
Build Where the Market is for Long Term Rentals
Most people living in Tiny Houses are either Millenials or Baby Boomers. For some Millenials, Tiny Homes allow them to own a house at a relatively earlier stage in their lives. Tiny Homes cost only about a third of traditional houses, which can go down further if you go DIY. Some Baby Boomers find it impractical to continue living in conventional homes after retirement. Cleaning a traditional house becomes a chore when you are getting old. Tiny Houses offer them little to clean and maintain. Because not everyone is willing to own one just yet, The Students, Millennials, and Retirees are the demographics you want to sell to for your Tiny Home rentals. A place with a booming economy and Universities is ideal for Tiny House projects. Texas and Florida make Tiny House living easier, though California is also now taking notice of the movement.
Tiny Houses for Group Vacations
With respect to the Tiny Homes rules and regulations in the area you chose, building Tiny Houses on a cluster is another way of earning from them. Clustering them together embraces the feeling of living in a community. Clusters of Tiny Houses will be at home, so to speak, near business districts and learning institutes or in outdoorsy areas where you can list them for Glamping, a relatively new trend for vacation rentals. Glamping is short for Glamorous Camping, where you simulate camping but with all the amenities found in our homes.
With the right design cues and overall appearance, Tiny Homes are very Social Media friendly, a plus factor for the so-called Instagram generation. Your tiny home rentals can sell themselves through the social media posts of your guests. Being a good host with a very instagrammable place goes hand in hand in this business. This formula will earn you more than enough income.
Financing A Tiny Home
A Tiny Home investment may now be brewing in your head, and you may be asking what options you have in terms of funding your Tiny House investment. Because Tiny Homes start at just around $10,000.00 to about $150,000.00, you don’t need to take a sizable loan to finance your Tiny Home build. Here are some options for you to consider.
Personal Loans
A personal loan is a relatively fast way of obtaining funds for your Tiny House project, but you should have an excellent credit score and banking history. Because they are unsecured, they usually have higher rates that range from 7% to 36% per annum, with short repayment terms of up to five years. Thus, you tend to pay higher monthly installments.
Cash-Out Refinancing
In Cash-Out Refinancing, you will get cash for a re-mortgage on your property. Simple but with some easy factors you need to know to make it work in your favor. The funds you can get from a cash-out refinancing will depend on the appraised value of your property and the outstanding balance of your mortgage for the same property. Let us give you an example:
Appraised Value: 400,000.00
75% LTV: 300,000.00
Outstanding Balance: 150,000.00
Gross Cash Out: 150,000.00
You should also consider the closing and other fees you need to pay for the transaction.
Cash-Out Refinancing closes your current mortgage, and in its stead, there will be a new mortgage imposed on your property. Thus, unlike Home Equity Loans or Home Equity Line of Credit, you do not have to deal with additional mortgages on your property. You can read more about Cash-Out Refinancing in our blog entry on GL&L Holdings website here.
With Cash on Hand, you may now start with your Tiny Home Project. You can also earn from it to help you with the mortgage. If all goes well, your Tiny House earnings may even end up paying for your entire mortgage.
Ready to Help
The Tiny Homes industry is estimated to reach $5.8 billion by 2024, and 56% of Americans would like to go into Tiny House living. The emerging popularity of Tiny Houses is on an uptrend as more and more people become aware of the advantages. You can end up spending less for the passive income you’ll enjoy for many years. Tiny Houses not only bring an opportunity for people to have affordable alternatives in owning a home, but they also help reduce your typical household expenses. More importantly, though, they are relatively cheaper alternatives for earning money thru real estate rentals.
Are you ready yet for this emerging opportunity? GL&L Holdings along with our venture partner AList Ventures does not only have a Tiny Home for you, but we also make sure of an easy way to own one through our various loan programs that you can check out here. Feel free to see our tiny home on a trailer listing here. Call us now at (832) 770-9415 or send us an email at info@gllholdings.com.
We are ready to help, always.
