Is a Microhome a Fit for You?
By: Jeff Brown

NEW YORK (MainStreet) -- Cute, cool, cheap, green. What’s not to like about the new trend of microhomes?

Not to rain on the parade, but let’s have a reality check. Small, very small and microhomes – ranging from 800 or 900 square feet down to 100 or 150 – may be a new trend, a fad, or just the subject of some clever marketing by their builders.

“The McCottage is replacing the McMansion as a home status symbol as more homeowners look to save money and reduce their impact on the environment,” says HSH Associates, the mortgage data firm. While national figures are hard to come by, or don’t exist, HSH quotes builders who suggest microhomes will be the next big thing.

If you’re building a weekend or vacation place, smaller is cheaper and better for the environment. But the HSH story says many people are building microhomes alongside their main homes as an alternative to a more traditional addition.

These small, self-contained buildings are ideal for an elderly parent who wants more privacy than a spare bedroom. And the microhome can be an income source as a rental, serve as a spillover space for visiting children or provide a private office space. That’s the sales pitch.

But before going this route, the homeowner should consider some downsides.

First, check local building and zoning regulations, which may prohibit a second home on the lot, limit the portion of the site that can be covered by impervious surface, ban rentals or limit the number of unrelated people who can live on the property.

Second, explore the costs of a traditional addition before committing to a separate structure. Ads for kit-style or manufactured micro homes can make them look cheaper than they are, touting a price for just the shell, not site preparation and interior finishing, which can add tens of thousands of dollars.

Adding to the main house could be much cheaper if, for example, you can tie into existing water, sewer, electrical and heating and cooling systems. You might avoid any foundation work by going up – putting an apartment on top of the garage, for instance. In contrast, a microhome might require a serious excavation, especially in regions with cold winters, as water and sewer pipes must be buried below the frost depth.

While advocates of microhomes talk about low maintenance and energy costs, a main-home addition of the same size might actually be cheaper to keep up. An addition typically shares walls with the main house, limiting the area of new walls and roof exposed to the outside. With a microhome, all sides and the roof are exposed to the elements, increasing heating, cooling, painting and cleaning demands.

Finally, consider that the microhome fascination may be a passing fad that will leave owners with white elephants when fashions change in a few years. While many people scoff at the McMansion today, pressure to display wealth and keep up with the Joneses often returns when economic conditions improve. Just think about how people go back to SUVs and trucks when gas prices fall.

There’s no doubt that living in a smaller home is cheaper than living in a big one. But when it comes to adding living space, the microhome has yet to prove a financial winner.