Thoughts on Tiny House in backyard for extra income

Property Manager · Petaluma, CA · Member since 2016 · 19 posts · 9 votes

Using a tiny house as an extra bedroom- no bathroom no kitchen- Good idea or bad idea?

It's the size of a shed, or average bedroom. I'm renting these out as an affordable housing solution. I've designed ones that are on a trailer and ones that can be put up on site in an afternoon.

I've got an ad up on craigslist to find people who might need an extra bedroom in their backyard.

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Thomas S.

Member since 2016 · 13k+ posts · 12k+ votes

10y

What do your municipal building codes allow regarding placing habitual units on properties.

I would think it would be a contravention of most building codes but you need to look into it first..

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DAn L.
OP
Property Manager · Petaluma, CA · Member since 2016 · 19 posts · 9 votes
10y
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Thomas S.
Member since 2016 · 13k+ posts · 12k+ votes
10y
What do your municipal building codes allow regarding placing habitual units on properties.
I would think it would be a contravention of most building codes but you need to look into it first..
3 Reply
DAn L.
OP
Property Manager · Petaluma, CA · Member since 2016 · 19 posts · 9 votes
6y
Use the federal law. Ignore city code. Don't waste your time
1 Reply
Marlon P.
Rental Property Investor · Kent, WA · Member since 2020 · 21 posts · 3 votes
6y
@DAn L.
Nice ones! I’m about to build a 10x12 livable shed in the backyard to be use as an extra bedroom(no bathroom or kitchen) to rent it out for about $500/month.
I’ll be spending $8,000 on the project with materials and labor.
I’ll be getting only $300 because I’ll let my tenant get the $200 left because he will allow the rented person on the extra bedroom to use his bathroom and kitchen. So we all win. What do you think?
1 Reply
Matthew Irish-JonesBusiness Member
Real Estate Agent · Buffalo, NY · Member since 2017 · 2k+ posts · 2k+ votes
6y
@DAn L. There are a lot of zoning issues locally around these places. Very tough to do in Buffalo NY. You should look into local zoning ordinances prior to setting one up.
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Timothy Smith
Investor · Buffalo, NY · Member since 2019 · 163 posts · 112 votes
6y
@Matthew Irish-Jones I'm going to start looking into this for two of our properties that used to have rear houses -- one we just demolished in March. Do you have any contacts that would be good to discuss with? I was thinking Bernice as she knows the zoning laws quite well.
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Matthew Irish-JonesBusiness Member
Real Estate Agent · Buffalo, NY · Member since 2017 · 2k+ posts · 2k+ votes
6y
@Timothy Smith I think you should start with an Architect. They will know the building and zoning laws. Happy to recommend one I have used several times and have been happy with. Let me know
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John W.
Rental Property Investor · Buffalo, NY · Member since 2017 · 257 posts · 130 votes
6y
The nice thing is if the building department/zoning board gives you a hard time then you can just move the thing.
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Tonya Copeland
Investor · Member since 2020 · 7 posts · 1 vote
6y
Talked to one guy from Berkeley, CA, he was making a huge profit from renting out his tiny home on Airbnb. The gross rental yield was above 40%, yeah this may sound crazy but people would still pay extra for a tiny house rather than a private home in a nice apartment.
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Rachel H.
San Antonio, TX · Member since 2009 · 3k+ posts · 1k+ votes
6y
Definitely look into the zoning laws if you plan to pursue this niche. It will be different for each area and depend on the local government. Since it's fairly a new niche, there may or may not be local laws in place as to zoning issues on this property type. Hope that helps!
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DAn L.
OP
Property Manager · Petaluma, CA · Member since 2016 · 19 posts · 9 votes
6y
1 Reply
DAn L.
OP
Property Manager · Petaluma, CA · Member since 2016 · 19 posts · 9 votes
6y
0 Reply
DAn L.
OP
Property Manager · Petaluma, CA · Member since 2016 · 19 posts · 9 votes
6y
0 Reply
DAn L.
OP
Property Manager · Petaluma, CA · Member since 2016 · 19 posts · 9 votes
6y
If you know how to use the Fair Housing Act, you can get a special exemption from city code, because it's federal law.
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Brian Garlington
Realtor · Oakland, CA and a Real Estate Investor with Multi-Family Units and a Self Storage Facility · Member since 2016 · 2k+ posts · 2k+ votes
6y
Before Covid I met with someone in East Oakland that was wildly succesful with this exact startegy on AirBnB. I have not talked with him in quite a while but it is certainly a possibility.
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DG A.
San Francisco Bay Area · Member since 2015 · 196 posts · 181 votes
6y
Originally posted by @DAn L.:
If you know how to use the Fair Housing Act, you can get a special exemption from city code, because it's federal law.

Hey Dan, is there a specific section on the fair housing act that lays out the exemption you're talking about?

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Charles Cooper
Real Estate Broker · San Pedro, CA · Member since 2016 · 206 posts · 89 votes
6y
@DAn L.
This is great!
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Natalie Fink
Investor · Fort Lee, NJ · Member since 2016 · 1 post · 0 votes
6y
@DAn L.
Im not sure if Bigger Pockets will allow a link, but here is what I did with my shed. Check it out. https://abnb.me/6vbYanJEn9
ROI is phenomenal. Everyone loves it.
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Kevin Van Witt
Member since 2020 · 11 posts · 4 votes
6y
@DG A. Not really seeing the connection between the FHA and allowing exemption for a 2nd home on the property. In Westport CT we have something called an Accessory Apartment or an affordable accessory apartment.
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Jonathan Anderson
Dallas, TX · Member since 2018 · 46 posts · 27 votes
6y
I think you should call the city and get familiar with the zoning/ building codes so that you know what you can and cannot do.
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NA NA
Rental Property Investor · Indianapolis, IN · Member since 2019 · 16 posts · 3 votes
6y
@DAn L. I think something like that depends on your location, if your in Seattle that could be perfect, but if your in Indianapolis or Saint Louis, probably not so much. It seems hugely populated cities with less housing tend to have tenants who will be willing to live in a situation like that. Just try and do some research, see what's for rent in your area and or talk to a realtor to see if it's feasible for your area.
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Ricky Bass
Magnolia , TX · Member since 2015 · 44 posts · 13 votes
6y
@Natalie Fink I could not get the link to work. Please explain what you are doing.
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Dan Colantonio
Rental Property Investor · Long Island, NY · Member since 2019 · 30 posts · 7 votes
6y
@DAn L. Sounds like a good idea as long as it’s all legal. I’m not sure about the legalities.
Are you buying the tiny homes from a certain company? If so which one are you looking at? I’m interested in doing this in Long Island.
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Fred Cannon
Rental Property Investor · St Augustine, FL · Member since 2019 · 265 posts · 279 votes
6y
@DAn L. Would there be a market for a place without a bathroom or a kitchen. I find that kinda strange, I certainly would not consider this for my backyard, people will be using your backyard for their bathroom and you hose for a shower and your grill for their kitchen. That's a crazy idea.
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Sean Rana
New to Real Estate · Los Angeles, CA · Member since 2020 · 38 posts · 28 votes
6y
@DAn L. I would not really suggest it. Time is extremely valuable and I think the same time and energy you spend on trying to build a room in your backyard, you can instead spend on doing something else, like wholesaling, networking with other investors, forming partnerships, etc.
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