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The news on housing affordability is not good.
There is no state in the U.S. where a minimum wage job is sufficient to rent a two-bedroom apartment, and only 11 counties where it’s enough to rent a one bedroom place.
Even if you make a decent wage and buy a home it can be tough.
Lenders promote a 28% ratio of housing expense to income as normal, but that’s based on income before taxes and doesn’t include maintenance or utilities.
Add those factors to the calculation and your home can easily cost 40% or more of your take-home pay.
A better mortgage rate can save you a few bucks, and there are ways to save money on rent, but what if that’s just not enough?
You may need creative or even extreme solutions.
Here are some of those more-interesting cheap housing options.
You might find a few worth trying, while others may involve too much of a lifestyle change to even consider (but they’re still fun to read about).
1. Live in Someone’s Shed
I used to rent out a shed as a bedroom for $45 per week, all utilities included (one outlet, one overhead light).
My tenants had to come in the house to use the kitchen and bathroom, a bit of an inconvenience in winter (I lived in northern Michigan), but that was about the cheapest rent available in town.
A shed as housing is a gray area of the law, so people usually don’t talk about it, although there was a recent article by a guy living in a shed in London.
Of course, this really only works if you’re a single person and don’t mind living rough.
2. Live in Your Own Shed
When I used to rent rooms I was getting $75 per week for bedrooms inside and only $45 for the shed.
Naturally, I moved into the shed for awhile so I could make an extra $30 per week.
If you own your home, building a shed to live in frees up a bedroom to rent, making your housing situation more affordable.
The advantage of a shed, as opposed to adding a room, is that you might be able to avoid all permitting issues if it’s small enough.
Where I lived no permit was needed for structures of less than 100 square feet. My shed was 8-by-12 feet, or 96 square feet total.
I built it with cheap lumber and a second-hand door for about $200 total.
If you want to make your living space a bit nicer than mine was there are some great shed bedroom ideas on Pinterest.
3. Add an Efficiency Apartment to Your House
One way to make any home you own more affordable is to make it pay for itself.
I was able to rent out all the rooms in my first home by building an efficiency apartment behind it.
My wife preferred that to sharing space in the house with roommates, and the additional rent quickly paid for the $2,000 addition.
Of course, adding a bathroom, kitchen and living space for $2,000 is tough, so let’s say you spend $30,000 (doing most of the work yourself).
If you can borrow the money at 6% interest on a 30-year mortgage loan the payment would be $180 per month.
You can probably rent out the rest of your home for a lot more than that.
4. Buy a Condo
When my wife and I moved here to Tucson, Arizona in 2016, we bought a condo for $55,000.
That’s less than half of what a house would have cost.
Monthly HOA dues are $145, but lower maintenance costs (the association takes care of all outside matters), lower insurance cost, and lower property taxes still make this cheaper living than any house.
Of course if you’re borrowing to buy (we paid cash), you’ll save even more by choosing a condo because the the lower price means your payment will be much lower.
Condos are cheaper than houses in most places, which you can confirm by checking prices on Realtor.com.
5. Buy a Co-Op Unit
Co-op housing is similar to condominiums, but you buy shares in the corporation rather than the individual unit you live in.
This makes them just about impossible to finance, which drives the prices down.
As I write this there are a dozen co-ops for sale here in Tucson for $30,000 or less, the cheapest being $17,000.
Co-ops are not common everywhere, and can be difficult to sell.
On the other hand, if you can scrape together the cash to buy one, you’ll probably save thousands of dollars annually versus renting, even after pay the monthly co-op fee.
6. Rent a Motel Room
Sometimes, in some places, renting a motel room can be cheaper than an apartment. But the savings usually come from the flexibility.
For example, if you are new to an area and you rent an apartment too quickly, you might pay too much.
An extra $200 per month can really add up if you are stuck in a long-term lease.
A cheap motel room gives you a place to live while you look for the best long-term arrangement.
This is also a great option (assuming there are cheap motel rooms available) if you’re not sure you’ll be staying in town for the usual one-year apartment lease period.
7. Live in a Truck
Business Insider reports that when Brandon (last name withheld) moved to California to work for Google he didn’t want to pay $2,000 per month to share a bedroom
Instead he paid $10,000 for a box truck and moved into it.
His 128-square-foot living space included a bed and a dresser.
He used the showers on the Google campus, and parked the truck there for free.
He detailed his experience on his blog, FromInsideTheBox.com.
8. Rent a Bedroom
If you’re single it can make sense to rent a bedroom.
In most areas it’s much cheaper than renting an apartment, especially since utilities are often included.
One of the best place to find these rentals is Craigslist.
The best deals, if you value your privacy, are bedrooms that have their own outside entrance and a private bathroom.
These are almost like an efficiency apartment (just add a hotplate for cooking), but often rent for less.
9. Live on a Sailboat
Leann and Chad, on HoboSailor.com detail their experiences living on several sailboats. They say that to make this a cheap housing option you have to buy a used boat (their first one was $5,000), anchor in free places, and budget well.
They were able to keep their total living expenses (not just housing) to $1,000 per month, and they had a cat to take care of too. But it wasn’t always easy. Chad says living on a boat is “a great pre-marriage test that I would recommend to anyone.”
10. Live in a Van
Some years ago my wife and I rented out our place in Michigan and rented an apartment in a warmer place for the winter. Before going home we moved into our van. For a month we slowly worked our way across the country, happy to keep collecting rent on our house for a little longer before returning.
Living in a van is a short-term arrangement for most people who try it, but you can find plenty of van-living advice online if you want to do it as a lifestyle. And it can be cheap. Along the way we stayed for a week at some hot springs in Arizona for $3 per night, and stayed for eight days at a free campground (with hot showers) in Florida.
11. Live in a Bus
While we were at those hot springs in Arizona we spent some time hanging out with three guys living in a colorful and homey converted school bus. They kept it even cheaper than us by parking just outside the hot spring area on BLM land, where they didn’t have to pay the $3 per night (they walked to the hot springs).
Google “living in a school bus” and you’ll find plenty of people sharing their experiences. Julie and Andrew Puckett, for example, were tired of finding ways to pay the rent in Atlanta, Georgia, so they moved to the mountains to live in a converted school bus with their dog and cat.
12. Live in an RV
An RV is a step up from living in a van, since you at least have some sort of bathroom. You can live very inexpensively if you don’t move around too much and you find free places to park.
For example, Bob Wells lives in his RV on a monthly pension of just $1,100. He says he knows, “dozens of people who live in their vans and make much less than $1,000 per month.”
The travel aspect can be nice too, but that costs money. To keep it affordable stay long enough at each location to work and save money to cover the traveling expenses.
Of course you have to buy an RV to live in one, so how cheap can you get started? One woman who lived in a pop-up tent-trailer bought it for just $200 used. Larger pre-owned units often sell for under $5,000.
13. Live in Your Flip
Fixing and flipping houses can be profitable and can be a way to cut your own housing expense. For example, my wife and I bought our first home together in 2002 for $17,500 and lived in it for a few months while we put $1,900 in repairs into it — and then sold it for $28,000.
Stay longer in your home and it gets even better. That’s because the IRS says if you live in a home for at least two years you can sell it without paying tax on the the capital gain (up to $250,000).
For example, we lived in our condo in Florida for just over two years before selling it, so our $16,000 gain was entirely tax free. All I really did to that one was paint some of the rooms.
In other words, to have cheap or even profitable housing you can just keep moving. Buy a fixer-upper, live in it while you make improvements, sell it for a tax-free profit after two years, and repeat.
14. Rent a Mobile Home
If you find that it costs too much to rent a regular house, consider mobile homes. Depending on where you live you may get the same amount of living space for substantially less rent. Check Craigslist for mobiles that don’t show up in the listings of rental management companies.
15. Buy a Mobile on Land
If you plan to buy a home but are struggling to afford one, consider mobile homes that come with property. I’ve written about the advantages of mobile homes on land, and the primary one is the price. In some areas of the country mobiles on land cost less than half of what a stick-built house of similar size costs.
16. Buy a Mobile in a Park
Apartment rental data shows that the cost to rent a 2-bedroom apartment varies widely across the country, but averages almost $1,300 per month. Lot rent data for mobile home parks is harder to find, but a quick Google search shows that it’s less than $400 per month in many areas.
If you add a mobile home payment to lot rent and maintenance the total will often be much less than rent for an apartment of similar size. If you buy an older mobile home for cash, to eliminate the payment, you’ll have really cheap housing.
For example, a friend here in Tucson bought a nice old mobile home for $8,000 cash, so he has no payment. He pays lot rent a year at a time to get a discount, so his total rent is just $200 per month. Apartments are cheap here, but not that cheap.
17. Buy or Build a Tiny House
Photos of tiny houses show just how cute they can be. But after the initial romanticising of the tiny home movement, reports of problems with them started to appear. Like no room for stuff or even guests. And the legality issues (some places don’t allow them).
Still, if you live light and are organized, a small space can be cheaper. College student Joel Weber built his tiny home for $20,000 in order to avoid expensive rent. He built it on an 18-foot flatbed trailer (so he could move) and parked in in a friend’s backyard. It was part of his plan to graduate debt-free.
There are many other examples of tiny houses that have been built for even less than that, including one that was built for just $500 using recycled materials.
18. Pay Cash for a House
My wife and I have paid cash for our last few homes, so we have no mortgage loan payments. That keeps it cheap. It may not be easy, but you can start saving for an eventual cash purchase, and then look for an inexpensive home.
Our first home we bought together cost $17,500 in 2002. We bought our current home, a condo, less than a year ago for just $55,000.
The data shows cash purchases of homes are dropping, but this is one of the best times to pay cash. That’s because the biggest “cost” of paying cash is “opportunity cost” which is the loss of income the money would have made if invested.
With savings rates at about 1% and the riskier stock market near record highs, a house may be a good place to invest that cash.
19. Live in a Tree House
Treehouses are not necessarily an inexpensive housing option. If you look at online photos of luxury treehouses, or peruse the website of a company that sells them, you won’t see prices even mentioned.
And if you want to rent a treehouse for a night on Airbnb it will cost you $100 to $300 per night.
But if you do it right treehouse living can be affordable. Start with cheap land (or find a friend willing to let you use their land). Then use recycled materials to the extent possible, and keep the space small and simple.
20. Live in a Cave
Daniel Suelo occupies caves in eastern Utah and sometimes in the Sedona, Arizona area. He eats wild foods and drinks water from streams. He doesn’t even use money.
Because Suelo is a modern-day caveman he also goes dumpster diving for food and other supplies, and when he wants a break from roughing it he works as a house sitter. He has also lived with anarchist squatters in Portland, Oregon.
But for ten years he has spent most nights outdoors or in caves. He has an occasional problem with the law because there is a 14-day limit for camping in any one place on most public lands, but he mostly just keeps moving and keeps quiet.
Actually, quite a few people live in luxurious caves, but when you see their homes you can tell that affordability was not a consideration.
21. Get a Habitat for Humanity House
Habitat for Humanity can help you build and buy your home if you have a steady income (but not too much), a decent credit profile, a small down payment, and you’re willing to take classes on home ownership. Theses are basic houses because Habitat does not help people get into homes they can’t afford.
Depending on where you live and how many people are in your household, you can make up to $66,400 and still get a Habitat home. Contact your local Habitat affiliate to see if you qualify.
You pay for your home, but the mortgage is interest-free to keep it affordable. Also, because they’re built by you and volunteers, the price you pay for the house (construction cost) is usually far less than what the finished home is worth.
22. Live in a Shack
My friend bought a cheap piece of land and built a shack on it to live in. He paid to have power run to it, but it had few amenities. He heated it with a woodstove. The obvious advantage to living in a shack is that you can pay cash as you build it, so you won’t have rent or mortgage payments.
It works best if you take the time to find free and cheap materials. A quick Google search turns up a pinterest post on a cabin built for $2,000 and a tutorial on how to build a shack or cabin for under $1,000.
23. Live on a Houseboat
Houseboats are another of the options that can be expensive or cheap depending on how you do it.
A blogger who calls himself The Money Wizard detailed his search for a houseboat in Minnesota. He looked at boats running from $20,000 to $80,000, and found that there is no sales tax on houseboats in Minnesota, and no property tax. The cost to rent a slip is about $250 per month where he was looking.
24. Just Go Camping
Nancy Bolam paid $500 per month to live in an unheated room in a mobile home in Colorado. It didn’t have a closet or even a door. So she decided to go camping.
She camped out behind a friend’s home in a fabric dome heated by a woodstove. She had power from the nearby garage. Water and firewood had to be carried in. Three years later she had saved enough money to put a down payment on a house.
Rough? Maybe, but Bolam says “I will greatly miss camping as a lifestyle.”
If you don’t want to camp in winter use a seasonal housing strategy. A friend did that, living in a large wall tent half of each year and then renting an apartment when they were cheaper in the colder off-season.
And if you’re going to camp, you might consider the next option…
25. Live in a Tipi
This is another housing choice that’s probably temporary for most people who try it. Generally you go without indoor plumbing, although your living space can be pretty nice if you take the time to make it so. Just Google “luxury tipis” to see how comfortable they can be.
The Colorado Yurt Company says they have customers living in their tipis. Entering the basic options for a 20-foot-diameter tipi on their pricing page results in a price of $2,700. Of course you’ll need a place to set it up and an outhouse.
26. Join the Military
Military housing takes many forms, but one way or another, if you sign up for any of the armed services, you’ll have a place to live. Even if you live off base you get a “basic allowance for housing” (BAH).
27. Become a Squatter
Squatting is simply moving into and living in a place without permission. It was a big problem for authorities in places like Portland, Oregon back when there were still many foreclosed and vacant homes.
But what others see as a problem some see as a cheap housing solution. There is even an online tutorial on how to squat a building. It recommends moving into places the city has taken over, because private owners are more likely to evict you.
Naturally squatting has some problems. Most abandoned buildings don’t have running water or power. And of course, living in buildings you don’t own, without permission, is generally illegal.
28. Find a Job With Housing
If you don’t want to join the military to get housing, find one of the many jobs that come with it. For example, on the job website Indeed.com there currently over 600 results when searching “self storage resident manager.”
Other jobs that often come with housing include hotel manager, campground host, apartment building manager, and some positions in the national parks. Or you can…
29. Become a Permanent House Sitter
This is not really a job, because as a house sitter you’ll be an independent contractor. You may not even get paid, other than in the form of free lodging. Also, to keep a roof over your head you’ll have to keep looking for the next gig.
You’ll probably want long-term assignments to keep your moves to a minimum. It also helps to have a backup plan in case you have “down time” between homes. That could be a van which you can live in for a few days between gigs, or a list of cheap hotels to stay at.
Because there may not be enough gigs in one area this works best if you have a portable income (great for writers who are inspired by changing environments, for example).
30. Live in a Commune
Wikipedia describes a commune as “an intentional community of people living together, sharing common interests, often having common values and beliefs, as well as shared property, possessions, resources, and, in some communes, work, income or assets.” They take a lot of forms, but basically you live with others and do a lot of sharing.
It can be a way to keep housing costs minimal. For example, The Farm, a commune that’s been around since 1971, requires a monthly contribution of just $104. Residents no longer pool their money so you have to cover your other living expenses.
Not sure you’re ready for communal living? At The Farm you can stay for short periods to give it a try. The cost? Just $2 per night.
31. Live in Hostels
I’ve paid as little as $3 and as much as $55 per night for a bed in a hostel. That was for short periods (often just a night). Some people use hostels as a home, staying in them for months or years. You can probably negotiate a lower rate for long stays.
Although you typically rent a bed in a room with others, many hostels have private rooms for a little bit more money. In that case you would still share other living space, including the kitchen, and possibly the bathroom.
32. Live in Your Office
Terry, who understandably doesn’t give his last name, wrote a piece for Salon about secretly living at work for 500 days. He couldn’t afford rent in Los Angeles so he quietly moved into his office, sneaking out to shower at a nearby gym early each morning, so he could “arrive” at work at the normal time.
Of course, if you own your own business and have an office you don’t need to worry about the boss. The landlord might have a problem with your arrangement, but she doesn’t necessarily need to know, right?
Yes, this will almost always be a short-term housing solution. But if you live in an area with high rental rates you could save a lot of money over the course of six or sixteen months.
33. Become a Nomad
If you freelance like I do you have the option to move as often as you want. For my wife and I that’s meant 12 homes in 12 years for my wife and I. Even if you don’t have a portable income you might be good enough at handling money to work, save, move and repeat.
Britany Robinson takes the nomadic lifestyle to a higher level. She’s been living in hotel rooms as she explores the U.S., and will not be buying a home even if she settles in somewhere for a while. She says, “I’m addicted to the freedom of renting over buying, as are many of my friends and peers.”
One advantage of being more nomadic is that you can go where rent is cheaper. Or you can go where jobs pay more, which makes it easier to pay the rent.
34. Buy a House in a Depressed City
You can buy houses in Detroit, Michigan for $1, according to current listings on Realtor.com. If those sell there are others for a few hundred dollars, and hundreds of listings below $15,000. In Birmingham, Alabama there are many homes selling for less than $10,000.
Cities that have faced tough times have cheap homes. They also tend to have low-paying jobs, so this option works best if you have some sort of portable income you can bring with you.
Small towns are another possibility. For example, my wife and I bought a home in move-in condition for $17,500 in Anaconda, Montana in 2002. The copper smelter, the town’s primary employer, had closed in 1980, and home prices dropped for years.
35. Live in a Storage Unit
A self-storage unit often costs less than $80 per month, which might tempt you to use it as an apartment. Given the lack of a toilet or running water, it’s not an ideal housing solution. But in the interest of reporting on as many options as possible, here we go…
Becky Blanton, a former police officer, moved into her 10-by-20-foot storage unit after her freelance writing income declined. The facility manager knew she was there and chose to say nothing. It was a temporary arrangement that allowed Blanton to save enough money to move into a nicer home four months later.
There are reports that living in storage units is happening more often. People doing it discuss it on Reddit, and there are plenty of YouTube videos on how to make a storage unit into a decent living space. It may make sense for some people as a temporary solution, but it seems nobody is recommending living in a storage unit for years.
37. Move in With Your Parents
CBS reports that 40 percent of young adults are living with their parents, the highest level in 75 years. Why? Low wages, student debt loads, and rising rental rates.
It also makes sense as a way to save money for a down payment on a house. Assuming your parents only ask for a reasonable contribution to expenses you might be able to save half of every paycheck while living in their home.
It’s a way to save for a business as well. Robert Kiyosaki, in his book Rich Dad’s Cashflow Quadrant, says he and his wife lived in a friend’s basement after a brief period of homelessness. They did so in order to avoid jobs while they worked on their business.
Hey, if it’s good enough for millionaire authors, maybe it’s worth considering.
38. Couch Surf
There are websites that help you find a couch to sleep on, like CouchSurfing.com. The problem is that you’re expected to share your couch too. That arrangement is for travelers.
To save money on housing by couch surfing you need at least a few generous friends. You don’t want to impose on any one person’s generosity for more than a couple weeks, so be prepared to keep moving. Offer an honest “move out date” each time you move in.
I’ve known people who have lived this way for short periods (a month or two), and keeping it short is probably the best plan. Be quiet and trouble-free, help with household chores, and never overstay your welcome, because you may need to stay there again someday.
39. Live Under a City
People living underneath the streets and buildings of large cities is not just fiction from movies. More than one reporter has covered the “mole people” of New York, for example, and you can find videos on YouTube about living in the tunnels of the Big Apple.
It’s also been reported that 1,000 people live in the flood tunnels under Las Vegas.
The reports make it clear that it’s not a nice life, but it is cheap (as in free). Once again, this is (hopefully) a temporary way to save on housing costs while putting together some money to use toward a more permanent solution.
40. Live in a Converted Shipping Container
There are some amazing homes built from shipping containers. You can even buy ready-made shipping container homes from Rhino Cubed. But their “fully equipped cubes” start at $52,000 for a 160-square-foot model.
To keep it cheap you need to do much of the conversion work yourself. Shipping containers at Western Container Sales start at about $3,000 plus delivery (or you can pick them up yourself somehow).
You can find examples of container homes built for less than $10,000, but you’ll also need land, a well, and a septic system.
What’s the cheapest housing solution you’ve ever found? Tell us about it below, and keep on frugaling!