Nolan Gray is a research fellow with the Mercatus Center at George Mason University and a professional city planner.
If you need to buy a house, why not try Amazon? Since 2015, consumers have been using the e-commerce platform to buy garden sheds and workshops. And in May, the Allwood Solvalla came online. It’s a 172-square foot sunroom with floor-to-ceiling windows, subtly marketed as a tiny house. Soon after its internet debut, the kit promptly sold out.
The structure, which marketing materials suggested two adults could build in eight hours, ran $7,250. But online reviewers panned it: One critic characterized the structure as a “[g]orified dog kennel”; another review simply read “This is dumb.”
But the budding Amazon tiny-house marketplace was officially open for business. In July came the Lillevilla Getaway Cabin—a 292-square-foot cabin that lacked electricity and plumbing, but had a loft for beds and a gabled roof. While undoubtedly better suited to human habitation, reviews were again harsh. Despite a price of $18,800 and free shipping, the consensus seems to be that it’s “not worth it.”
Is there a future for Amazon’s mail-order housing market? There is now a wide range of DIY home kits from multiple third-party sellers available on the site, ranging from bare-bones cabinettes to a two-story container house and even a pre-fab modular home for $105,000. They’ve enjoyed a deluge of media coverage, and curious Amazon users are peppering manufacturers with questions. And the market is certainly ready: With solo living on the rise and a deepening nationwide housing shortage, demand for smaller, cheaper places to live is sure to grow in the coming years.
Novel as it may seem today, the mail-order house—tiny or otherwise—has a solid pedigree in North America. Beginning in 1908, after establishing an empire in the mail-order catalog business not unlike Amazon’s contemporary domination of online retail, Sears introduced the Sears Modern Home catalog, selling everything from modest bungalows to proto-McMansions.
Early models ranged from roughly $20,000 to $70,000 in 2019 dollars; then as now, buyers brought the land and labor. Combining amateur homebuilders with budget materials might seem like a recipe for shoddy quality, but more than a few Sears houses have ended up on the National Register of Historic Places. According to one estimate, over 70 percent are still standing. One D.C. model, purchased in 1925 for $3,727, recently sold for over $1 million. In all, Sears sold 75,000 homes. The kits provided a low-cost path to homeownership at a time when cities were booming and housing costs were rising.
North America’s affordable housing shortage could serve as the same economic rationale for Amazon’s mail-order house business. As housing prices skyrocket in places like Los Angeles and Boston and developable urban land becomes increasingly scarce, an affordable build-your-own-house kit could be just the fix for many households. (And since the company is often blamed for boosting real-estate prices in Seattle and now Northern Virginia, it might be karmically appropriate for Amazon to get in on the solution side to the affordable housing crisis.)
Folks aren’t exactly sitting around waiting for Amazon to act. At the heady intersection of a lingering housing bubble hangover, rising rent-to-income ratios, and reality TV shows about the joys of downsizing, a movement has formed around tiny houses. So far, the pint-size domiciles have been most popular in places where land-use regulations are relatively lax, in states like Colorado and Nebraska. One fast-growing Arizona town built a tiny-home neighborhood for public school teachers. They’ve also been touted as housing solutions for historically marginalized communities, providing shelter for families at risk of homelessness in cities like Seattle, Detroit, and Austin.
But for all the media attention that the tiny house movement has managed to stir up, the actual number of tiny homes out there has been notably limited. In large part, that’s because of zoning. In most North American cities, local zoning rules on issues like house size, lot size, and residential density expressly prohibit tiny-house-style developments. When one Los Angeles nonprofit opted to bypass the rules and provide persons experiencing homelessness with free tiny houses, the City Council responded with an aggressive crackdown.
That resistance may be breaking down, however, as the grip of single-family zoning eases nationwide: The wave of recent reforms to laws regulating accessory dwelling units (ADUs)—or secondary units that share a lot with a larger single-family home—has created a legal space for tiny living. In cities as politically diverse as Portland, Oregon and Fort Worth, Texas, tiny houses can now share lots with conventionally-sized, site-built houses without added legal hassle.
State legislatures are also getting in on tiny house reform. Earlier this summer, Washington State passed legislation allowing small homes to be built as ADUs and in larger “tiny house villages.” In New Hampshire, state policymakers passed legislation in June that will have the state explore legalizing tiny houses in all residential districts statewide. Some cities are enthusiastically embracing the trend. In Spur, Texas, city leaders have vowed to clear out regulations in a bid to turn the small West Texas town into the “tiny house capital of America.” Colorado Springs, which hosts the annual Tiny House Jamboree, has also thrown its hat into the ring.
All this reform bodes well for Amazon’s awkward first steps into the mail-order housing space. At present, tiny-house development remains mostly small-scale and made-to-order; you have to be a fairly committed devotee of micro-living in order to navigate both the regulatory hurdles and the house construction itself. Turning that onerous process into a one-click transaction could be a transformative leap. By streamlining the market for affordable mail-order houses, Amazon is in a position to deliver a Sears-sized shot of adrenaline for a still-nascent tiny house movement.