How This 26-Year-Old Built a $35K Luxury Tiny Home in Her Backyard—and Pays $0 to Live There

In 2019, I bought a three-bedroom, 1,400-square-foot house in Atlanta, Georgia, for $196,000.

I planned to earn extra income by renting out the spare rooms on Airbnb since I traveled a lot for work and was rarely home.

Unfortunately, in 2020, bookings dried up. No one wanted to share a house with a stranger in the early days of the pandemic.

My work travels also stopped, so I was living alone in a house that felt too big.

But that May, as I stared out the kitchen window into my huge backyard, something clicked: I could use that space to build a tiny home to live in and fully rent out the main house.

How I Built My Luxury Tiny Home

Before getting started, I had to submit building, electrical, and plumbing permits to the city planning office.

Then, I purchased a shed from Liberty Storage Solutions and hired a local contracting team to pour a concrete slab foundation.

They got to work in October 2020. Overall, it cost me around $35,000 to build the home, which includes the prefabricated shed structure, labor, and material costs.

Instead of taking out a bank loan, I cashed out $8,500 in stocks and put about $20,000 on my credit cards to pay for everything.

I was able to pay off this debt last year. While the house was being built, I rented out my primary home and rented a room from my neighbor for $300 a month.

After we finished building the 296-square-foot tiny home in March 2021, I immediately rented it out on Airbnb for a few months to recoup costs.

By charging between $89 and $129 per night and $1,300 for monthly leases, I was able to bring in almost $32,000 in gross rental income.

And this January, I moved into the tiny home to save on living expenses.

Covering the Monthly Costs

Here are the monthly associated costs for both homes:

• Mortgage and property taxes: $1,200
• Electricity: $190
• Water: $110
• Internet: $80
• Total: $1,580

All of this is covered by the $2,725 I make from renting out the main house, which means I’m able to live in my tiny home for free.

A Look Inside My Loft-Style Backyard Home

To give the place a light and airy feel, I painted the walls a coastal blue shade and added some rustic touches like a wooden ladder leading to the loft’s queen-sized mattress.

In addition to the daybed that doubles as a couch on the main floor, there’s a full bathroom, kitchen, and breakfast nook. My favorite area is the kitchen.

Most people are surprised to see that it has a full-sized fridge and extra-large sink.

The eight separate windows, wall mirrors, and glass shower door all make the space feel bigger. I sometimes forget I’m living in a shed.

The “Tiny House” Lifestyle

I’ve had to downsize my wardrobe and shoe collection. But rather than getting rid of clothes I still want to keep, I store some at a friend’s house.

Every few weeks, we do a wardrobe swap. I don’t have friends over very often, but once the weather gets warmer, I plan to use the fire pit as a hosting area.

Having this home has given me a ton of real estate options, including rental income and backup housing for myself or aging family members.

Embracing Sustainable Living

I believe that tiny homes will play an important role in offsetting the global housing crisis.

Last year, I gave a TEDx Talk about how they can help create a sustainable sharing economy for land.

In 2021, after realizing the effects of vacation rentals on the real estate market in Atlanta, I stopped listing my properties for short-term rental on sites like Airbnb.

Renting out more and more space for vacations means less space for folks who need long-term homes.

I’ve since decreased my portfolio and am renting to local students and low-income workers.

My plan is to add an attached guest suite to the main home and provide even more stable housing.

Fully Experiencing the Tiny Home Lifestyle

This year, I’m excited to fully experience the tiny home lifestyle for myself. It’s amazing what you can do with a bit of backyard space.

Living in a tiny home has not only reduced my living expenses to zero but has also given me a new perspective on sustainable living and the importance of utilizing available space efficiently.

Building and living in my tiny home has been a transformative experience. It has provided me with financial freedom and an opportunity to embrace a minimalist lifestyle.

I’ve learned to prioritize what truly matters and to make the most of the space I have.

As I continue to explore the potential of tiny homes, I hope to inspire others to consider alternative housing options and to think creatively about how to use their own spaces.

The journey of building my tiny home was challenging but incredibly rewarding.

From navigating city permits to managing construction costs, I gained valuable insights into the process of creating a functional and beautiful living space on a budget.

The success of my tiny home project has also opened up new possibilities for real estate investment and sustainable living, reinforcing my belief in the potential of tiny homes to address housing needs in innovative ways.

In summary, my tiny home has become more than just a place to live; it represents a lifestyle choice that prioritizes sustainability, financial independence, and creative problem-solving.

By sharing my story, I hope to encourage others to think outside the box and explore the potential of tiny homes as a viable and rewarding housing option.

Precious Price is a TEDx speaker, marketing strategist, and social entrepreneur.

In 2021, she founded LANDRIFT, a digital real estate marketplace, in response to discussions about the effects of short-term rentals on housing affordability and availability.

She holds a master’s degree in management information systems from Indiana University.