There’s no doubt that dual occupancy homes are quite trendy in Australia, particularly outside of CBDs in suburban areas. Another trend that’s quite popular at the moment in America – and to a lesser extent in Europe and here in Australia – are tiny homes and tiny homes on wheels (THOWs).
These two types of accommodations are generally smaller than the typical single-family detached dwelling, especially those built by the Builders generation and even in recent times. As homebuyers’ lifestyles change, so too do their preferences and the demand for smaller and more manageable properties makes sense.
What are the differences between dual occupancy homes and tiny homes?
Overall Size & Layout
Before comparing dual occupancy homes and tiny homes, consider for a moment that the average Australian single-family detached home is approximately 180-240 square metres in floor area. Homes with 2-3 bedrooms and bathrooms, perhaps a spacious kitchen, living room, and other rooms are not uncommon in older and newer homes.
Comparatively, both dual occupancy homes and tiny homes tend to be significantly smaller. Stationary tiny homes (sitting on a plot of land) tend to be around 50 sqm or smaller, whereas THOWs are limited to around 37 sqm due to clearance constraints since the home can be hauled as a trailer.
Dual occupancy homes are much more versatile than most tiny homes, especially THOWs, because they are permanent structures that sit on two separate plots of land that are subdivided. Generally, the floor space of each home is around 60 sqm although they could be a little larger or smaller.
A big consideration one must make with dual occupancy homes is the ratio of structure to land on the property, minimum clearances for gardens and easements, and distance from adjacent properties, for example.
Accommodation Purpose
Both accommodation types can be used for permanent living, although there are often practical and long-term considerations one should make when deciding between these two.
THOWs are not fixed structures and it can be somewhat of a challenge to move the home and get connected with municipal supply of water, electricity, etc. Moreover, since they are not a fixed permanent structure it is far less likely that they’ll appreciate it. In accounting terms, they could be a depreciable asset like a caravan or motorhome, so it’s a lot harder to build equity when your asset is losing value over time.
Fixed structures are naturally different and tend to appreciate in value. Dual occupancy homes in particular are a great store of assets and generate significant equity due to the overwhelming demand for housing in Australia. Since you’re adding two homes on what would otherwise be vacant or perhaps one home, you could see tremendous growth in equity over the years.
Finances & Income
While it’s quite fashionable to let out quirky and fun accommodations short-term on platforms like Airbnb such as tiny homes on wheels, it might be a lot harder to generate consistent rental income. These homes are called ‘tiny’ for a reason, and even those that are quite minimalistic might feel cramped living there for extended periods.
Dual occupancy homes feel (and generally are) more spacious than flats but not quite as large as a full single-family home, thus striking an excellent balance for young working professionals, small families and couples, or seniors.
Moreover, dual occupancy homes allow owners to generate one or two streams of rental income, hedging against vacancy periods and providing prospective tenants with attractive properties.
Demographics & Multi-Generational Living
A big reason behind the rise in popularity of dual occupancy homes to begin with has to do with changing demographics, i.e. smaller families, minimalism, and affordable housing for young adults in challenging economic times. Tiny homes do tend to attract these types of buyers and renters too, but they tend to lack the versatility that dual occupancy homes offer.
Trevor Homes
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