Accessory Dwelling Units, also known as ADUs, have had a dramatic impact on the real estate market ever since the tiny home craze took over the country in the early 2000s. While younger generations look at real estate differently and multigenerational households are becoming more common, construction companies are struggling to keep up with the times and offer ADUs to the millions of homeowners and investors who are ready to pull the trigger on this lucrative business opportunity. So, let’s take a closer look at the tiny home and ADU market, why it’s gained so much popularity, and the positive impact it can provide to the housing industry and our society as a whole.
Why Accessory Dwelling Units are Growing in Popularity
Everyone from current homeowners to prospective home buyers and real estate professionals have watched the housing market change and adapt in recent years. With multigenerational households gaining popularity, a solution has come to the housing industry to provide a new opportunity to those looking for additional space in and around their home. ADUs have become an increasingly more viable option for property owners to invest in, and as the ADU market continues to experience unprecedented growth, it’s become a more lucrative business opportunity for home builders and housing developers alike.
The Housing Market
The state of the housing market has always been a topic of conversation but has been especially on our collective mind since the 2008 market crash and with the internet providing more available information and news on the subject. While this industry has seen massive shifts in the past three years due to the COVID-19 pandemic, we saw 2022 come and go, with it remaining a seller’s market for the majority of the year. So far, 2023 has seen buyers begin to gain an upper hand in the equation, with the supply slightly outweighing demand. However, there’s another, bigger aspect at play: interest rates.
In the past, interest rates have risen and fallen based on a number of typically fixed factors. However, the biggest conversation surrounding this subject stems from their change during the pandemic, where the average home mortgage rate dropped below 3% in response. Today, most densely populated areas have since seen this rate climb to upwards of 6 and 7% in just under three years, making millions of buyers wary and hesitant to jump into buying their first home or even a new home.
Additionally, it goes without saying, but the average price of a home has grown steadily over the past hundred years, while the median household income has not progressed at the same rate. It’s no longer feasible for everyone to purchase their own home as in previous decades, and those that have been able to afford it have been mostly from existing homes and not new home builds.
The Housing Crisis
While the phrase “housing crisis” is thrown around often in conversation and in the media, it is a serious issue across the nation and affects a variety of aspects in our society today. Essentially, the affordable housing crisis is the term given to the long-term shortage we’ve seen of affordable homes available to low- and even median-income renters. This has resulted in people being forced into lifelong relationships with renting and increased rates of homelessness–especially in areas with higher population density.
According to The National Low Income Housing Coalition’s 2023 report, most renters across the country are feeling restricted to renting due to both the limited real estate inventory in their areas, and the markedly high interest rates being placed on home mortgages today. This shortage disproportionately affects people of color and the most severe shortages are being seen in states like Nevada, Oregon, Florida, California, Arizona, and Texas.
The Solutions Accessory Dwelling Units Provide
ADUs, whether they’re built as 300-square-foot studios or they can boast multiple bedrooms and over 1,000 square feet, are the alternative homeowners today are turning to when they both want to avoid diving into an expensive housing market and want to do what they can to provide affordable housing to their friends, family, and community. Everyone from aging parents moving in with their adult children, people moving back in with their parents after college, and homeowners needing additional space in the wake of the work-from-home and small business ownership movement can benefit from ADUs.
- Additional Space for Family
- Room to Accommodate Telework
- Additional Space for Revenue Generation
The Only Tiny Home Franchise Catering to this Demand
As the popularity of ADUs and tiny homes continues to grow, only a handful of construction companies and firms are taking advantage of the demand, leaving customers on months-long waiting lists. That’s why our Anchored Tiny Homes founders took their construction experience and put it to work in the ADU space after recognizing the incredible revenue potential and seeing how it would give them an opportunity to help solve the U.S. housing crisis. Today, the tiny home franchising opportunity they present gives entrepreneurs and prospective business owners across the country the chance to make the same money and impact.
Break into the Accessory Dwelling Unit Space
Anchored Tiny Homes is the only tiny home and accessory dwelling unit franchise in the U.S. today and has created the ground-floor franchise investment opportunity for those who feel motivated to change their community for the better and to escape corporate work. When Scott Paulhus and his two sons, Austin and Colton, broke into the unique niche that is ADUs, they knew that the solutions they provided to investors, homeowners, and disadvantaged renters alike would transform the construction and housing industries altogether. With our low initial financial investment and minimal employee requirements to start, it’s easy to get in on the ground floor, capitalize on the ADU home-building service in your market, and start making a difference.
Whatever your life looks like now, know that there is another way to provide a brighter future for your family and the community that surrounds you. When you leave your day job to start your own Anchored Tiny Homes business in your area, you get the impactful, turnkey opportunity that comes with all the support you could need to get started. To learn if you qualify, please contact us with the form below today.