By Melissa Eure, president of G.C. Garcia, Inc.
Housing attainability is a discussion item in Nevada as well as many other states. Factors such as the high price of land, limited supply, cost of regulatory approvals for zoning, increasing costs of building supplies and an ever-decreasing number of laborers makes affordable housing seem unobtainable. Recently, the Nevada Legislature passed SB 150, which could provide some relief to this long-standing issue. The approval of SB 150 revises the provision relating to housing to require that zoning districts allow for tiny homes. What does a bill related to tiny homes and affordable housing have to do with one another? Consider it from a development perspective.
Let’s look back at what increases home prices. First is the cost of land. Say that 10 acres would normally cost around $4.5 million. Now, of those 10 acres, three will go to private streets and required open space for neighborhood amenities. Now you have seven acres for homes. Zoning regulations determine how many homes you can put on each acre, the length of the driveway, the minimum space between homes, and the minimum yard size each home is required to have. Now you have reduced the number of homes you can fit. Fewer homes mean an increase in home prices, then add in the price of building materials and labor. So now where do tiny homes fit in? Potentially, pretty much everywhere.
Tiny homes allow for smaller lots while still providing a large amount of open space, and more than enough adequate room for driveways. Less land needed per lot allows for greater density, which allows developers to bring down the price. In addition, tiny homes can be manufactured quickly which can cut down on the cost of labor and materials. That doesn’t mean that they aren’t attractive quality products. Many tiny homes come with upgraded features like stone veneer exteriors, granite countertops, rooftop patios, and hard flooring, to name a few. All these factors lead to being able to cut home prices down considerably which has allowed multiple cities around the U.S. to create tiny home communities for those that otherwise would not be able to afford a home of their own.
One example is Detroit, which has utilized tiny homes to provide low-income housing needs. The homes are funded by a non-profit organization and the residents are senior citizens, college students and people that were previously homeless. Their rent is $1 per square foot, and they attend classes on financial literacy and homeownership. After seven years, residents are given the deed to their tiny home and the property it sits on. Near Greenville, SC is Lake Walk, a community that offers four models around 400 square feet with prices between $70,000 to $80,000. The community itself boasts a nature path, large green areas, and a community center for residents. Closer examples are in Walsenburg and Salida, CO where tiny homes range from 100 to 500 square feet with the largest model running about $92,000. All these homes have foundations and access to utilities, along with plenty of open space and community amenities. Best of all, the tiny homes come with a much lower price tag for potential homeowners. As these states and others have shown, using tiny homes are an effective way to create affordable housing near more traditional residential areas.
Now, it will be up to the local jurisdictions in Nevada to incorporate these new regulations into their zoning codes. This may mean making changes to existing codes, many of which require minimum lot sizes that would be oversized for tiny homes. As these changes are implemented, we may start to see these tiny home subdivisions spring up locally. This may be a small step to solving a much bigger affordable housing problem, but hopefully residents will see this as a positive way for more Nevadans to achieve the dream of home ownership.
Melissa Eure is the president of G.C. Garcia Inc., a Nevada-based land planning and development services firm currently celebrating 25 years in business. For more information, please visit www.gcgarciainc.com or call (702) 435-9909.