In a housing affordability crisis, Victoria University (VU) researcher Dr Hing-Wah Chau says tiny houses are up to 90% cheaper than traditional homes and should be seen as a viable housing alternative.
His research shows that in Melbourne, the median house price is more than $900,000, while the cost of a tiny house is around $80,000–$160,000 to build with land occupancy costs dependent on the type of tiny house. It’s also much quicker with a traditional new house build taking up to one year while a tiny house can be constructed in just four weeks.
The Tiny House concept – a dwelling that is under 50 square metres and may also be transportable – has been growing in popularity overseas and in Australia.
There are two main types of tiny houses: tiny houses on foundations (THOFs) and tiny houses on wheels (THOWs). A THOW is constructed on a trailer and is required to comply with road legal dimensions and vehicle regulations.
With large sections of the community struggling to afford or secure safe housing, and the 2021 census showing 122,494 people homeless across the country (about 30,000 in Victoria), the case for novel housing approaches is growing.
“It’s a safe, affordable and accessible housing option that should be seen as a genuine housing alternative. We simply can’t afford the financial and economic cost of traditional housing as the only answer, especially when the rental market and public housing waitlists are not serving the community,” Dr Chau said.
Not only are building costs and timeframes much lower, but the ongoing costs are also more affordable. This is partly due to the sustainable living philosophy that motivates many to live in these small houses.
“Many who get into the tiny houses are committed to reducing their carbon footprint. This means they are often equipped with rainwater tanks, composting toilets, solar panels and batteries. Being able to operate completely off-grid is not only a lifestyle choice but a big financial appeal,” he added.
Victoria going big on small homes
Dr Chau’s research shows Australia is still leading the world in average house size. This means costly builds that require increasing amounts of material and energy to construct and operate.
While the Shire of Esperance in Western Australia was the first local council to recognise tiny houses as permanent dwellings in December 2022, the tiny house movement is growing in Victoria.
In June, the Mount Alexander Shire Council removed permit requirements for residents to park their THOWs on properties that already had existing dwellings.
And the Surf Coast Shire looks to be the next to give this housing option a go with Council expected to start a two-year trial of tiny homes starting in early 2024.
“There is a real opportunity for Victoria to be a leader in this housing revolution that is affordable, sustainable and importantly, accessible for our community,” Dr Chau said.