Home Depot's New $44,000 Tiny House May Not Be As Affordable As You Think

Transcription for the video titled "Home Depot's New $44,000 Tiny House May Not Be As Affordable As You Think".

1970-01-01T01:12:31.000Z

Note: This transcription is split and grouped by topics and subtopics. You can navigate through the Table of Contents on the left. It's interactive. All paragraphs are timed to the original video. Click on the time (e.g., 01:53) to jump to the specific portion of the video.


Introduction

Intro (00:00)

Hey what's happening guys what is going on YouTube you guys have tuned into rules for rebels and in today's video we're gonna be talking about Home Depot's all-new $44,000 tiny home this is a this has been kind of a photo and a story that's been kind of making the rounds on social media getting shared a lot on social media a lot of media outlets have been picking this up and talking about it and I think this is a hot story because you know a couple weeks ago we it a lot on social media. A lot of media outlets have been picking this up and talking about it. And I think this is a hot story because a couple of weeks ago, we had stories about how people were starting to live in Home Depot sheds. Obviously, due to inflation, mortgage rates, and the cost of home ownership, a lot of people have been priced out of owning homes. So now, this story about Home Depot is making some headlines. We're going to be taking a look at an insider article titled, Catastrophe Proof and Dirt Cheap.


Discussion On Home Depot And Home Building Systems

Home Depot (00:45)

Home Depot's $44,000 DIY tiny house underscores America's obsession with small living. Now, I think there's something more to this story. You know, put your tinfoil hats on. We can talk about this a little bit of maybe getting into the realm of conspiracies and things like that. But obviously, we've all heard the WEF thing, right? You'll own nothing and you'll be happy, right? Everybody's going to rent everything. You're going to rent your home. You're going to live in some tiny walkable city where nothing is more than 10 minutes away from you. And at one time in this country, and not even that long ago, homeownership was the American dream.


A Goal For A Lot Of People (01:24)

Home ownership was what most people sought after. Home ownership was a goal that most people have or had. And this is something that the government pushed as well, right? The government wanted people to own homes. You know, it's good for kids to grow up in a stable environment. It's good for community. If you own a home, you're going to have to work to pay for that home. So it kind of keeps people in the workforce. So the government has always kind of pushed the idea of home ownership even among the American people home ownership and owning a home having the white picket fence was something that people chased after was a goal for a lot of people and now we're slowly starting to see this narrative change I'm starting to see more and more articles like maybe home ownership isn't what it's all cracked up to be. Maybe you should look at small living.


Home Depot Ep Part 3 (02:06)

Why small living is better than homeownership? Why condos are better? And we're kind of slowly starting to see the government and the media and even the banks kind of change this idea that homeownership is what you should be chasing after. And now that homeownership is so unaffordable for so many people, the narrative has kind of changed. Oh, maybe a condo is better than owning a home. Or, you know, maybe you want to live in a an RV or a mobile home, maybe you want to live in a van, or maybe you want to buy a $44,000. You know, Home Depot, tiny home, or maybe even want to live in a tough shed or Home Depot shed. But you know, that's a big part of this story is I think kind of the narrative around homeownership being something you should chase after. I think that's slowly changing to where, you know, people should pursue alternative lifestyles or alternative types of living. Now, I'm a big fan of tiny homes and shipping container homes and small living. Even before all these tiny home television shows came on, this was always something that I was kind of interested in. Even before everybody kind of knew what a shipping container home was, I used to go on a lot of weird niche forums and things like that. And I was into a lot of this stuff long before a lot of this stuff became popular and before there were TV shows and companies selling tiny homes and shipping container homes. So I think alternative living, I think smaller spaces, I think all this stuff is very cool but i would like to see people choosing to live in a shipping container home or a van or an rv not because that's the only thing they can afford to live in but because it actually fits their lifestyle and that's something that they want to do if you want to move around to a lot of different places if you're a traveling nurse and you're constantly going to be moving if you don't want to be tied down to one location, I think there are benefits to living in an RV or a towable tiny home or a van or whatever else. But again, I want people living in these, I guess, kind of alternative living scenarios because it's something they want to do or because it's something that fits their lifestyle, not because society is so messed up that nobody can actually afford to buy a real home and everybody is forced to live in vans or storage containers or shipping containers or sheds in their parents' backyard.


Living Alternative (03:30)

I think there was a story a couple weeks ago about how a lot of young people are building sheds in their folks' backyards. Here's another thing about this, right?


Diy Home Kit (04:19)

This Insider article and a lot of the media pieces on this seem to be framing this as like, look, you could be a homeowner for only $44,000. Here's what they don't tell you. This is the DIY kit. So first off, I'm guessing most people don't have the skills to be able to build this home themselves. So what does that mean? You're going to have to pay somebody to build it for you. I would guess that that's probably going to add at least 25% of the cost of this home. So if the house is, I don't know, say $44,000, I'm guessing it's going to cost you at least, I don't know, $10,000, $15,000 to get this thing put together. I wouldn't be shocked if it winds up costing you about half the price of this DIY tiny home to have it assembled. So we'll round it up to say $50,000. I'm guessing it's probably going to cost you, say, another $20,000 to have somebody assemble it. So we're at $44,000, $54,000, $64,000. Well, now you're also going to have somebody assemble it so we're at forty four thousand fifty four thousand sixty four thousand uh well now you're also gonna have to have it connected to public utilities now if the lot that you buy or the land that you buy already has utilities maybe it's a fairly easy hookup otherwise it can actually be very very expensive bringing utilities from the curb to where the home's going to be or even more so if it's down the block and then here's another problem ultimately you're going to have to have some more so if it's down the block. And then here's another problem. Ultimately, you're going to have to have some land to put this home on.


Lots (05:25)

Now, you know, if you want some super rural land up in like, I don't know, near me, like the upper peninsula of Michigan is pretty wide open. There's some pretty cheap land up there. Obviously there's no jobs. They have really, really brutal winters. But hypothetically, you could buy, you know, buy some property up in the upper peninsula of Michigan and put one of these $44,000 tiny homes on it. However, if you actually want to be in a city or a suburb, it's going to cost you a lot more. And I was kind of curious what lots in my city are going for. So I looked up, I just went on to Zillow, Redfin, whatever, and just checked the box for land or lots and not actually homes or apartments or condos or whatever else. And I was looking at lots in my city. The cheapest lot in my city is $189,000. I would say most of them were $2,000 to $2,000. And there were a number of lots that were $800,000 to $900,000 just for the lot. Now, I didn't want to be stuck just in my city. So I looked at some surrounding cities, some other places in the Chicagoland area, and it was pretty comparable. I would say $200,000 is probably a low end of what you get a lot for. All of a sudden, this $44,000 home that, okay, we've got to pay somebody to build it, that's going to bring us up to $44,000, $54,000, $64,000. Now we've got to buy a lot for, we'll say, $200,000, so now we're at $264,000. I'm guessing, and this is where the problems really begin, right? So all of a sudden, this $44,000 home is now closer to $260,000. And that's if the city will even let us build this home. Because here's another problem that you run into. And again, I've actually looked into buying land and buying tiny homes and building shipping container homes. A couple of problems with a lot of cities and counties and municipalities. So first off, there are a lot of cities and counties that won't let you build anything under 600 or 650 square feet. That seems to be kind of the magic number where a lot of these cities wind up cutting you off. So I'm kind of surprised that Home Depot didn't make this thing.


Zoning (07:21)

I want to say Home Depot's tiny house. We'll get into it in the article in a minute here. I want to say this thing's about 550 square feet or something like that. I'm kind of surprised Home Depot didn't make this 600 or maybe even like 660 square feet, just because that would at least allow you to get around the building codes in a lot of cities. You know, some cities make you build a minimum square footage of like 800 square feet, but I feel like there are places you could find that'll allow you to put a house that's only 600 square feet up. Here's the other thing. All of a sudden now you got to get the city or the zoning committee to approve this building. And I know years back when I was looking at doing storage containers, right? Storage containers are one of the most hardy, sturdy materials or surfaces out there, right? It's literally a steel box. I mean, they stack these things like, what, 20 of them high and throw them on a boat and send them across the ocean, and they wind up going through fine. But for some reason, cities are really concerned that your shipping container home is somehow going to collapse in on itself. So now you're going to have to hire an architect to draw up plans for this tiny home to then submit it to the city and hopefully get the city to approve it. Because again, cities don't really like doing anything that's not necessarily traditional. A lot of cities may wind up telling you that they don't really like the look of tiny homes or a steel shipping container home doesn't really fit the look of the city. So let's look at this tiny home thing. So all of a sudden it goes from, hey, you can be a homeowner for $44,000 to, oh, it's going to cost more like $260,000 plus. Oh, and, you know, somebody else is going to have to build this for you. So you're going to have to find a builder and hopefully you can find a city or municipality that actually allows you to do this. So it's not nearly as easy or attractive or cheap as it initially seems. I'd love to hear your guys' take on this whole tiny home thing. Is it something you would consider? Do you need more space in this? I guess any other thoughts that you guys have on this issue? I think one thing I wanted to touch on, I wanted to talk about, okay, so, you know, we talked about with this tiny home, if you're lucky, you're into this thing for, for 260 in my city, right? It's probably going to be a lot more than that, but if you're lucky, you're into this thing for 260. Now, what would a traditional home cost in my city? Well, you know, I talked about, there was a house that somebody bought the other day down the street from a friend of mine where they bought it for $230. They did kind of a cheap flip and they turned around and listed it for $284. That's kind of high price. But I have seen, and I talked about this in the video yesterday, if you don't mind a dated home, if you don't mind a home that's not updated cosmetically, something that's livable but doesn't necessarily have the newest styles and newest colors, it doesn't have barn doors, it doesn't have gray floors or walls, you can find homes for $250,000 to $300,000 in my city. And I talked about in the video yesterday, I saw a house that was sitting for weeks, $246,000 on almost a half acre, had an outbuilding in the garage behind it that was powered if you want to have a workshop or something like that. New windows. The floors looked like they'd been done within the past couple of years. New paint. Again, not the fanciest house or the biggest house, but definitely a nice livable house. It was going for $246,000 and it sat for weeks. I saw another house that looked like it was an estate sale going for about $250,000 on over a quarter acre. So again, I'm going to wind up paying $10,000 more for this $44,000 tiny house after everything's said and done than if I were to just buy a cheaper, not updated house in my city.


Thanks for watching Dasailer Investment Solutions: (10:52)

We'll give a quick run through this article. I think it's a pretty short one. And again, this one's from The Insider. Catastrophe proof and dirt cheap. Home Depot's $44,000 DIY tiny house underscores Americans' obsession with tiny living. They talk about America's obsession with tiny living. I know the TV shows are popular. I know a lot of people like the idea of tiny living. But here's an interesting fact about tiny living. I believe it's something like 72% of people who try tiny living or buy these tiny homes wind up moving out and selling the thing within under two years. A lot of people love the idea of tiny living, but I think a lot of people realize the reality of it isn't quite as good as some of these shows make it seem really romantic and things like that. Here's some bullet points from the article. Home Depot is selling a tiny house frame for $44,000. Now, they say frame here, so I'm guessing the inside is kind of unfinished. So you're likely probably going to, you know, maybe we'll find out from the article. I'm guessing you're going to have to buy, you know, put a kitchen into the home. I'm guessing you're going to have to put in flooring. You might only even be getting kind of a shell here, which means there's a lot more expenses that go along with it. But we'll read a little bit further and find out. In tight real estate markets, tiny homes are becoming an increasingly attractive living option. But outside the US, like in Germany, prefab tiny homes also come with financial risks. For just $44,000, a US hardware store chain, Home Depot, is now selling many houses online. In the United States, they are the answer to several crises. $44,000, a U.S. hardware store chain, Home Depot, is now selling many houses online. In the United States, they are the answer to several crises. In Germany, the trend toward tiny houses is associated with financial risks due to peculiarities in German law. It may only be 50 square meters in size, but this small house is impressive. The so-called getaway pad residents live in a light-filled bedroom, a daylight bathroom, and a kitchen living room. A spiral staircase on the exterior wall leads to the rooftop terrace with seating, and there is even a mini kitchenette. Now, just to interrupt this real quick, I think if you are going to do tiny living, it helps if you live in a warmer climate where you can actually take advantage of outdoor space. If you're living in the Midwest or the upper northern half of the country for six months out of the year, six, seven months out of the year, you're going to be stuck in your home, right? Because you're probably not going to be sitting out in your deck when it's 50 degrees in the fall and especially not in the winter. But if you live in a warmer climate where maybe you could attach a TV to the outside of the house and that kind of becomes your living room and you can spend nine months out of the year or even all year long spending time outside, you can eat your meals outside, you can entertain guests outside. Heck, again, you can even throw a TV outside, watch a TV or movies outside. Then it might not be that bad. But if you're living somewhere where you got a three-month summer, you're probably not going to be too happy crammed into 500 square feet for nine months out of the year. The house is not the individual work of an architect. The U.S. hardware store chain Home Depot is now selling it in bulk with just a click of their online shop. The mini house is priced at $43,832, which is around 41,000 euros, and monthly installment payments are also possible.


Monthly Payments Available. (14:19)

Curbside delivery is included, so they will deliver this to your door. The product suddenly turns a big hardware store chain into a house seller, albeit only in a category of so-called tiny homes. These are houses that make the most of minimal space. Now, what's kind of interesting about this when you talk about pre-built houses or prefab houses, and I know this is the case in a lot of areas in the country, but here in the Chicagoland area where I'm from, there was a company back in, I want to say like the 20s or 30s called Lundstrom or Lundstrom. And occasionally you'll see these Lundstrom or Lundstrom houses. They're probably only a thousand, maybe 1200 square feet.


Bought, Not Built. (14:50)

I believe they're like entirely made out of metal. And it's kind of cool because if you actually go inside of the house, it's got a lot of like built-in cabinets and things like that the walls are like metal or steel the ceilings like metal and steel like you know everything is metal so you can use magnets and sticks things to the wall as opposed to having to use thumbtacks and things like that they're kind of neat houses when I was looking for you know I've been in my home since about 2017 my current home when I was shopping for homes, I actually saw a couple of these Lundstrom houses. And then also Sears. Sears actually used to sell homes out of a catalog in the Chicagoland area. I believe Sears was headquartered out of Chicago.


Home Construction. (15:36)

I think they've gone bankrupt in recent years. But there's a lot of Sears homes in the Chicagoland area as well. If you guys are in the Midwest or specifically the Chicagoland area, there's typically websites that will list like sears homes and ledstrom homes so if you're curious about this want to drive around and check some out uh you know just google like uh you know sears home chicago or ledstrom home chicago and you could probably find some to drive around and look at however residents hardly have to compromise these many houses have a bedroom a kitchen and a private bathroom. And when it comes to safety, these small residences are said to be on par with regular single-family homes. According to Home Depot, the getaway pad is earthquake-proof, storm-proof, tornado-proof, and can survive challenges of Mother Nature. Now here's something interesting.


Insurance. (16:20)

We know that in California, Farmers Insurance, all state insurance, and a lot of other, I think it's 10 or 11 insurance companies in total have stopped writing policies for the state. Florida has had that same problem for decades, but that problem is getting even worse in Florida. And it's not just Florida and California. A lot of companies that issue homeowner, a lot of insurance companies that issue homeowner's insurance are hiking prices and pulling out of a lot of different states and a lot of different areas. So one thing I would wonder about is if you're able to get homeowner's insurance on one of these Home Depot houses, that would be interesting to know. In the United States, a real movement has emerged in recent years advocating for living in small houses.


Exploring Small Houses And Tiny Homes

American small houses (17:02)

Owners are either concerned about the environment or simply want to keep living costs low. And it seems like Americans are also thrilled about the hardware storehouse. Those who order it have to wait several weeks for delivery. Now, here's something that's interesting. So, you know, my house, I believe I'm about 1,050 square feet, which is, I think, pretty small. Over the past 20 or 30 years, homes have gotten bigger and bigger. I know a lot of people have moved into McMansions and things like that. Prior to my current house, I was renting a 3,300 square foot house. That was way bigger than I needed. It was a lot of extra space that not only did I have to clean, but you just wind up throwing junk into space. My house prior to that was about 1,400 square feet. I feel like that's kind of the sweet spot. You know, I think 1200 square feet can work if you have a basement. My current house is a little bit small. I'm kind of lacking some storage room as far as like clothes and closets and also lacking like a pantry to put groceries and things like that. And I have a dirt crawl space, so not really an accessible area to store things. You know, I think my thousand square foot house could probably work if I had a finished basement or even just a basement that was accessible and I could store things in. But I will say mine's a little bit tight. I think the five, six hundred square foot stuff is a little bit too small. But I do think most people have way more space than they actually need. There've been a number of studies, and you can probably find articles about this, you know, in some of these McMansions and some of these larger homes, they've done these studies where they've put heat maps in and looked at where people spend most of their time. And, you know, you'll basically see like a visual representation of the home, and then you'll see like red hot spots where people spend their time. And pretty much like all the time is spent in like the kitchen, the bathroom, and the bedroom. Like the rest of the house is completely clear. That space goes unused. So I think a lot of people don't necessarily need these 2,000, 3,000, 4,000, even 5,000 square foot homes that a lot of people are getting nowadays. But I do think like 500 square feet is a little bit low for your average person or for most people. The low cost in particular attract many people. Rents and mortgage rates have recently skyrocketed, and even though property prices in the U.S. have experienced a small dip, the cost of an average American house is still just below the record price from August of last year. The value of a residential building across all types of construction is currently around $339,000, according to data from the U.S. real estate broker Zillow. And again, keep in mind, that's not single-family homes. They're saying everything. So that's apartments, co-ops, condos. I believe the average price of a single-family home has crossed over $400,000 at this point.


+$30,000,000 government project (19:39)

Prior to the start of the COVID-19 pandemic, it was only 243,000. Experts predict another 5% increase over the course of the year. So I actually think we'll see prices continue to pull back, but they're saying experts say prices are going to continue going up. And this is like a whole different topic for another video, but I see efforts to kind of prop up the housing market, right? Like I think they realized nobody can afford homes. Demand is falling. And the only reason property prices haven't fallen more is because, you know, people are kind of at a stalemate. Nobody wants to buy, nobody wants to sell. And unless there's a lot of selling action, it's not going to bring prices down. But you remember like a couple months ago, Bank of America was like, hey, black and brown people, we'll give you mortgages, no questions asked, 0% down. If you're black or brown, just come out, we'll give you a mortgage." It's like they're trying to sucker people into the housing market. Now we see Rocket Mortgage is offering what, like 1% or 0% down mortgages. We're seeing more and more mortgage companies who are basically saying, we'll put the 3.5% down for you and we'll tack it on to the end of the loan. I think now you're actually seeing some mortgage companies who are basically saying, we'll eat the cost of your down payment. We'll cover your down payment. We just want to get you into a home. So there's a lot of effort happening right now to continue to get people to pour into the housing market because they don't want the housing market to collapse. Back into the article, in states with a particularly tight real estate market, tiny houses are becoming the only affordable alternative.


ADUs and tiny homes (20:52)

Even the government has recognized this. California is currently investing around $30 million in the construction of 1,200 small houses to combat homelessness. That state, more than 170,000 people are living on the streets because they can no longer afford accommodation. And I believe, if I'm not mistaken, I'm not sure if it's the entire state of California or if it's just maybe San Francisco or Los Angeles, but the term ADU, it's like accessory dwelling unit or something like that. It's basically the idea of having a coach house or like a grandma flat or whatever in your backyard. If it's not the entire state of California, it's at least Los Angeles or San Francisco is starting to allow people to put essentially housing or ADUs in their backyard, grandma flats in their backyard. I know in Chicago, in the Chicagoland area, they banned coach houses a long time ago. So the only coach houses out there are the ones that have already been built. But I do think as home prices continue to become more and more unaffordable, I do think we'll probably see more cities and states open to the idea of allowing people to build an apartment above the garage or build an accessory dwelling unit behind the home. Back into the article, in social networks, users are already exchanging information about the cheapest land prices in the U.S. to find a spot for their inexpensive tiny houses. Communities in rural states like Oklahoma are even offering relocation bonuses of over $10,000 for outsiders who settled there. I think Virginia or West Virginia also has a program where they'll actually pay you to move there. And I think there's some cities in Texas and Iowa doing similar things. Other buyers, on the other hand, smell a business opportunity. How easy would it be to have three of them on the same plot and then simply rent them out, writes one user on the Twitter microblogging service. rent them out, writes one user on the Twitter microblogging service. However, the low price of the getaway pad comes with a catch. As revealed in the fine print, to turn it into a proper house, buyers have to dig even deeper into their pockets. Home Depot is only selling the steel frame kit for $44,000. So again, there's not walls or anything. So you're going to have to put drywall up. You're going to have to put flooring in. You're going to have to put kitchen cabinets and appliances and bathroom fixtures.


Building A Tiny House (23:04)

I mean, you're going to have to put drywall up. You're going to have to put flooring in. You're going to have to put kitchen cabinets and appliances and bathroom fixtures. I mean, you're going to have to put everything in. I'm guessing just outfitting the inside of this thing will probably cost you as much or more than the $44,000 price tag. If buyers want to install doors, windows, and the appropriate toilet, they have to pay extra, not to mention furniture. And if buyers don't want to assemble the kit themselves following the ikea style instructions they also have to hire a craftsman furthermore the house is designed to be built on a concrete slab so the buyer will likely need to spend several thousand more to get the ground prepped meanwhile they are also tiny houses on wheels also depending on the place of, buyers may also need to apply for appropriate permits to comply with local building regulations. And again, that's even if the city will let you put your place there. The cost of laying a concrete slab right now is through the roof. I know a buddy of mine, his mom recently bought a house and her concrete slab behind the house was all torn up. I know he had called a couple concrete guys. And I mean, just to put in maybe a 10 by 10, 15 by 15 slab, he was getting quoted 10, 12, 14, even $15,000. So, you know, let's tack on for a slab the size that will fit this home, let's say probably another, I don't know, $15,000 for that as well. So this home continues to get more and more expensive. The hardware store chain points out the design flexibility for potential buyers due to the rudimentary equipment. You have complete freedom to design and furnish your house in a unique way according to your spatial needs, budget, and personal style, says Home Depot. At least the frame has punched holes for easier installation of electrical and plumbing lines. However, they are not included in the building kit. Excessive regulations and requirements hinder tiny houses in Germany. Nonetheless, the demand for tiny homes is also growing in Germany. Specialized construction companies report an annual increase in demand of about 1 3rd. However, buying with just a click, as in the US, could quickly become a financial risk here. The blame lies with the excessive regulations in Germany. Fulfilling the requirements depends not only on the place of residence, but also on the size, construction type, and specific location and duration of the use of the tiny house. It's easier to build your tiny house according to individual building regulations of the selected property. To first build the tiny house and look for a plot of land explains German Tiny House Association. I'm not sure why they're going so heavy on Germany here as opposed to the U.S. since this is on Insider.com. German regulations are far from simple. Local requirements such as the development plan determine how a new house must be designed to fit into the surroundings. Furthermore, it is often generally expensive to find a suitable place for one's tiny house. And again, I said in my city, that's going to cost you $200,000 plus. In the U.S., on the other hand, the possibilities for buying a house with just a click seem to have no limits. In addition to the getaway pad, Home Depot currently offers even cheaper, albeit smaller models, and these are essentially sheds. A wooden bungalow called the Seabreeze, measuring 34 square meters, costs around $23,600. And the model Phoenix, with an area of around 16 square meters in its own bathroom is already available for $12,500. However, buyers should be sure because the houses cannot be exchanged.


Concluding Remarks

Conclusion (26:13)

So looks like that's the end of the article. We're closing in on 27 minutes here, so we'll wrap this one up. If you guys enjoyed this video, give it a thumbs up. If you're not subscribed to the channel, click that subscribe button down below and ring the bell. And as always, guys, I would love to hear your thoughts on tiny homes, shipping container homes, non-traditional living, as well as the idea I talked about where do you think the government, the media are kind of trying to spin the idea that homeownership is no longer the American dream, and maybe you want to live in a bus or a van or a condo or a tiny home instead. Are you noticing that as well? Drop a comment down below and let me know. As always, guys, thanks for watching and I will catch you on the next video. Guys, later. Peace. I'm out.


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