Micro-apartments growing in popularity, could you handle only 300 sqft (or less) of living space?

The Japanese have been doing it for a long time now, building and living in tiny apartments that are only a few hundred square feet, all the way down to around 200 square feet and that way of thinking is catching on here in the states as well. OregonLive.com posted an article on micro-apartments , specifically the Freedom Center Complex in Portland’s Pearl District, citing a renter, Paula, that has moved to Portland and is renting one of the tiny 286 square foot studio apartments while building a home in the Portland area.

Other developers are also considering similar projects as these tiny living spaces are becoming more and more popular. In New York Mayor Bloomberg is even breaking the cities rules by actually setting up a competition for architects to design micro-apartment buildings with the prize being the permission to build one.

As the rule goes with Real Estate in general, the lower the square footage the higher the price per square foot (and vice versa) and these small apartments are no exception demanding a significantly higher price per square foot than the larger, albeit still small, one bedroom apartments.

There are a number of reasons for this micr0living boom, one aspect is of course young people moving out on their own, they simply don’t have a lot of “stuff” (yet) so these tiny apartments are usually bigger than the bedroom in their parents home or their college dorm room and hey, it’s theirs. Another reason is during the “great recession”, as OregonLive.com calls it, a lot of people began sharing housing either with family or taking on roommates to save on living expenses and those folks are starting to get out on their own again. Of course there is also the minimalist movement spurring the boom as well.

The rent however still seems quite high to me for 286 square feet; at $850/month on average when you can find 1,000 square foot one bedroom lofts in the same area for around $1,600. Okay, yes, I know $1,600 is a LOT more than $850 – still, that’s $1.59/psft compared to almost twice that at $2.97/psft for the micro-apartments. As I mentioned before, the smaller the space the higher the price per square foot (renting, buying; doesn’t matter) and this is due to the hard costs to build (permits, land, design etc) that have to get soaked into the cost of the space to consumers so the larger the square footage the less of an impact those hard costs have on the price per square foot, the smaller the space the larger the impact.

But almost TWICE the costs? Wow.

Anyway, what does $850/month get you when buying? Well, in the Pearl District, nothing, actually…unless you look at just the principle alone which could get you a decent one bedroom condo for around $800/month…but after tossing in taxes, insurance and HOA’s you’re more around $1,300. HOWEVER, unless you’re dead set on living “in the Pearl” you could go just 2-3 miles from downtown and find a number of possibilities that while closer to $1,000 offer ownership instead…want to get that well under $1,000 and still own? Get a two bedroom and get a roommate, you’d have significantly more living space then 286 square feet and you own it.

So, if you’re into the small / less is better thing and don’t mind wasting your money on rent (IMHO) then maybe these micro-apartments are for you?

~Scott McDonald

 

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