One of the biggest reasons you hear that people want to “Go Tiny” is the cost. But does buying a smaller house really save you money in the long run? How much different are your expenses? Though different regions will fluctuate in prices (cost of living in L.A. or N.Y.C. is going to be higher than Pocomoke M.D. or Buckhannon W.V. for a drastic example) here are some cost comparisons that Sarah and I first noticed when making the decision to buy our RV.
Rent versus Lot Rent (and RV payment)
The primary expense that you want to analyze is how much you pay in rent (or your mortgage) versus what you’ll end up paying for the lot of land you’ll put you RV/Tiny House on and what the payment for your unit is. Consider the places we lived while we were in Pennsylvania. There, Sarah and I lived in a studio apartment, a three-bedroom row home, and our current RV that we kept in a local campground. Each had their perks, but the overall costs in this category don’t really compare. This is how they break down:
- Studio Apartment Rent (in Manayunk, considered in the city of Philadelphia) $1000/month
- Three-Bedroom Row Home (in Ambler, PA, a suburb of Philadelphia) $1100/month
- Lot Rent at Oak Grove Park (in Hatfield, PA, in Montgomery County) $410/month + RV Payment $267/month = $677/month
Here, the clear winner is our lot payment plus our RV payment. We brought our monthly rental payment down by about 1/3 when we switched from the row home to the RV. This could have been even more drastic for those lucky few who can buy their RV/Tiny Home outright and eliminate the RV Payment expense all together. I don’t want to just throw numbers at you, but the first number evaluation that really made Sarah and I consider the push to look at buying our own Tiny Home was when we examined the yearly totals of where we’d lived the two years renting in Pennsylvania. In the studio apartment we paid $12K a year and at the row home we paid $13.2k a year. Think about that. In two years, Sarah and I had spent $25,000, and at the end of the day, have nothing to show for it. That money is just gone. Granted, we had a roof over our heads, but that $25k could have almost paid over 2/3s of our RV outright, which is something at the end of the day we should have some return on if/when we decide to move on from it (and then we would be part of that lucky few who don’t have the monthly RV payment, making the continued price difference even more staggering).
But this isn’t the only number to consider, let’s check out how some of the other necessities stack up against one another.
Arguably the second highest price tag on a home is going to be the electric. And this can vary a great deal depending on who your supplier is. In Philadelphia and the surrounding area, I felt we got something in the mail every week about our energy supplier and if we knew where our power came from (which I always thought was PECO). I didn’t look into it much–though Sarah might have–so I can’t give honest advice on how much our bill would be affected if we would have switched. What I can tell you, is that our bill during the summer and winter was always higher (for running the AC and heaters) and less in the spring and fall when we didn’t. I don’t remember a bill over $150 nor do I remember one less than $50. I know when we rented, we could often have a payment plan with the power company that mitigated the up and down pricing to a more constant number.
That wasn’t the case in the RV.
On average, our electric bill has been higher in the RV. We really started to notice this when we traveled to Scotland and England in 2017. We had the power turned off to most devices and no one was there using it (unless the cats someone master-minded a way to hook every back in while we were gone). When we returned, we still had a bill of around $120 though we weren’t home half of the month. This seemed high so we wanted to look into way that was. After doing some research, we discovered that RV rental sites are legally allowed to up-charge their customers for electric. Excuse me? But the more we looked into the subject, the more we found there wasn’t anything saying that the owners of the property couldn’t up-charge us. Around the site, our neighbors even warned us to “watch out” for our electric meters.
When it comes to this utility, our days renting apartments and row homes had a better deal.
**If you decide to install solar panels, a lot of these numbers won’t do you any good. I’ve heard plenty of good feedback from people who use them both on their house and their RV. There are the horror stories too, but if you want to really bring your electric bill down, solar might be the way to do it.
This price largely depends on what gas is used to heat your house. We have friends that use natural gas, while our RV uses propane. The price of these gases can (they don’t always) fluctuate similar to vehicle fuel prices. In our 15 months with Oak Grove, we paid anywhere from $65 to $90 for our propane tank refills (these were 100 gallon tanks). During the winter months (especially in January of 2018 when temperatures we single digits for much of the month) we would burn 3-4 tanks a month. During the months of May-September, we might use 2 tanks for the entire summer, really more like 1.5. Our hot water heater is electric so the only propane we burned when the heater wasn’t running was what we cooked with.
Compare some of those numbers to what we spent at the studio apartment and row home, which saw monthly gas bills between $50 and $250. Again, I do think there was an option to have an average bill per month, but we never elected to do that.
Ultimately, I feel gas is a wash. Most of it depends on the type you use in your home or RV which dictates the cost.
It may seem like a small payment, but often times for RVers water is included in the lot rent. So Sarah and I never received a water or waste bill while at Oak Grove. At the studio apartment or row home, we didn’t pay more than $50 for three months(the water bill arrived quarterly), but it was still an expense we needed to cover. It was a small gain, and one we forgot about until the writing of this post, but still another area in which living in our RV saved some money.
Cable, Internet, & Phone
The final monthly expense most people have for their homes is the cable, internet, and land-line ( yes, a land-line can be found in a home if one of the service providers convinces you that their triple-play option is the best deal). At Oak Grove (and many of the other RV sites we looked at), we were able to get the same cable and internet hook-ups that we could at the places we rented. The service providers are of course limited to their coverage areas, but there was no difference in price for say Comcast at the studio apartment and Comcast at Oak Grove.
There are some RV sites that include cable with their rentals, which we have determined isn’t common. I’m sure some rental apartments include this service as well, but can likely be found with the same frequency. The major difference I see came down to when we didn’t have cable installed. Our RV has an antenna we can use to get some channels while our apartments did not. I doubt we would use the antenna for an extended period of time, but the option is there if a cable hook-up is not. Ultimately, there is no difference in price from RV site to an apartment.
The Real Cost Differences We Have Experienced
At the end of the day, I can say that we’ve paid more for certain utilities in our RV than we did when renting apartments, but overall, our bills went down. In the 15 months at Oak Grove, Sarah and I never paid over $1000 in utilities (that would be lot rent, electric, and gas). There were some months that utilities plus our cable bill and RV payment totaled over $1000, but just barely (this happened during the extreme cold of January 2018). At the studio, our bills were consistently over $1300 and at the row home they were even higher.
Living Tiny can be a good way to cut some expenses, but it isn’t a complete abandonment from all of your bills. You’ll ultimately pay for similar utilities, but the price of a lot rent versus a rental property often is a fraction of the cost.
*All of the prices used in this piece were during the years of 2015 through 2018 and may have changed since the publication of this article. As mentioned, different regions are subject to different price points. This article focused on the greater Philadelphia region and is not intended to be measured against cost of living in other areas.