The tiny home market is massive and continuing to grow, and many buyers opt to purchase used instead of new. While this is a great option, there are a few items that we encourage purchasers of used tiny homes on wheels to be mindful of before taking the plunge.
1. Remember that this is not a typical home sale.
This point may seem obvious but is important enough that it needs to be stated. Typically, the purchase of a home, condo, townhome, or other real property is a long process. There is bidding followed by inspections, earnest money deposits, appraisals, title searches, and many other steps that make the whole thing seem like a never-ending exercise in decision-making.
By contrast, the process of purchasing a used tiny home can be as simple as an exchange of cash. This means that the steps put in place to protect buyers of traditional homes are absent from the purchase and sale of a tiny home. Because of this, there is more risk involved with the purchase, and buyers must take a more active approach to avoid as many unwanted surprises as possible.
2. Get an inspection.
If at all possible, hire a licensed inspector or knowledgeable contractor (preferably with tiny home experience) to inspect the home prior to purchase. Inspections are standard during the buying process for conventional homes, so it only makes sense to insist for one when purchasing a tiny home. A knowledgeable inspector can point out possible issues with the roof, plumbing, chassis, electrical, insulation, and other issues that may not be immediately obvious.
3. Research your tiny home’s title and registration.
Tiny homes on wheels are titled in much the same way as your car, truck, or motorcycle. Buyers need to make sure prior to purchasing the home that the seller can transfer its title. One of the biggest issues to watch out for is liens. These are placed on property by lenders who weren’t repaid on the loan they provided or on individuals who are owed money for services provided to the property’s owner.
In addition to titling your tiny home, many states and local governments require that your home be registered. Registration requirements are specific to where you live and, additionally, may be dependent on how your home was made and whether it received any recognized certification. Be sure to research your town and state’s requirements so that you know what to look for while shopping for a tiny home.
4. Formalize the purchase agreement.
Selling a tiny home on wheels often resembles a used car sale more than it does the sale of a home. In such cases, the buyer and seller meet and agree on a price. The buyer gives the seller money, and, in exchange, the seller provides the buyer with the home’s title.
However, we encourage buyers to enter into a more formal, written agreement with the seller. This will provide you recourse if the tiny home doesn’t live up to expectations. The agreement should include representations and warranties from the seller as to its condition, any promises the seller must keep as a condition of the sale (as discussed in number 5 on our list), and what damages the seller will owe to the buyer if these conditions are not met.