By Bruce Thompson at Urbaneer
My wife and I built a compact, reconfigurable, energy efficient home two years go in an urban location that allowed us to eliminate a car. The 1600 square foot interior and a small lot size reduced our taxes, our lawn maintenance costs, our home insurance and utility costs. The good quality of materials and technology we used will reduce our home maintenance over time. The configurable URBANEER features we incorporated allow our compact space to live 15% larger because we convert the space to use as we need. We are so happy because our home provides us with a sense of freedom we haven’t experienced for years. Less time and money are spent on house expenses and chores, thus freeing up our time for other experiences. Time is priceless!
The challenge to articulate the savings and the real estate value of our flexible home comes because we are stuck using conventional metrics. Conventional math doesn’t add up for housing such as ours. The standard measurement of construction cost per square foot doesn’t capture any of the benefits outlined above. Eliminating a vehicle is a $600 a month cost savings or 30% of a traditional mortgage or rent on a home like ours. Conservatively, we save another $300 a month on ancillary home ownership expenses which puts us at a 50% overall savings.
It took us three appraisers however to receive the value required for financing as none of these benefits listed above fit in a traditional appraisal process. The first two appraisers simply gave up and the third was willing to push the boundaries to better reflect our home value.
The time for a new approach is now. In a recent survey by RCLCO Real Estate Advisors, 18% of respondents wanted housing less than 1,500 square feet. Home builders however continue to build homes that average 2,400 square feet and apartment developers continue to oversize studio and one-bedroom units which limits the available units per floor. This continues in part as old financial and tax models drive the housing industry. It’s a challenge to place innovative housing types over an outdated model. Almost every part of the housing industry value chain requires change to truly solve the housing crisis. From policy to financing and the construction industry the model supports 20th century housing types and not today’s needs.
As more housing across the spectrum begins to change to reflect the needs of the 21st century, new metrics to measure value will be needed. I propose measuring life per square foot vs. construction cost per square foot. Life per square foot includes factoring in the savings and freedom of living efficiently, not just tallying the expenses, and is a good way for everyone to evaluate just how much housing really costs each of us beyond the conventional per square footage metrics we see today.
URBANEER is creating the future of living. We are working to break down the barriers to innovation and provide a range of new housing options for compact and configurable living spaces under 1500 sq. ft. We have successfully established a cross-functional team of industrial designers, engineers, architects, builders and a building supply company to help break open a new model that is designed from the inside out. We see it as a new formula for freedom. Freedom in living.