Budget Planning

How to build a realistic tiny-house budget, and avoid the costs that catch people out.

The single biggest budgeting mistake in tiny living is treating the build or purchase price as the total cost. The home itself is only part of the picture. A realistic budget plans for land, delivery, site setup, services, fees and a contingency, so the project does not stall halfway when an unexpected cost lands.

The cost areas to plan for

• The home: the build cost or purchase price, whether you build yourself, buy a shell or kit, or order a turnkey home.
• Land or pitch: buying land, or rent for a leased site or backyard arrangement (an ongoing monthly cost).
• Delivery and transport: towing or transport to site, which rises sharply with distance and any oversize permits.
• Site setup: levelling, a pad or footings, anchoring, decking and access works.
• Services: power, water and wastewater connections, or off-grid systems like solar, batteries, tanks and a composting toilet.
• Fees and approvals: council or planning applications, engineering, and any inspections.
• Fit-out and finishes: appliances, furniture, heating and cooling, and the finishing touches that always add up.
• Finance and insurance: loan setup, interest, and insurance, if you are not paying cash.

Always include a contingency

Set aside a contingency of around 10 to 15 percent of your total budget for over-runs, price changes and the items you did not think of. Almost every build meets at least one surprise, and a contingency is what keeps it from becoming a crisis.

Budget for the running costs too

A tiny home is cheaper to run than a conventional house, but it is not free. Plan for ongoing costs like land or pitch rent, power and water (or off-grid maintenance), insurance, gas bottles, internet, and a small annual amount for upkeep. Knowing your monthly running cost is what tells you whether the lifestyle is genuinely affordable for you.