Micro condo life: buying and living in your new small condo
Minimal design aesthetics and maximal real estate prices continue to drive the micro condo trend. Also known as micro-units or apartments, these ultra-small and intricately designed properties are mostly made for singles and young couples. While living small is not for everyone, adjusting your size requirements is a great way to afford a modern condo in a desirable inner-city location.
In order to fit everything in, the typical micro-unit combines the innovative use of space with modern materials and technology. While lots of smaller condos are sold as pre-designed units, if you're buying a pre-construction condo you may be able to get involved in the design process to some degree. This also applies if you're doing renovations on an existing condo, with the clever use of space able to maximize both utility and value.
The tiny house movement
The micro condo movement is related to the tiny house movement, which is a growing trend across the world for well-designed but incredibly small detached homes. As populations rise and climates change around the world, the notorious McMansions of yesteryear are slowly being replaced for a more sustainable vision of the future. Tiny houses are typically smaller than 500 square feet, which means they could fit in the average American family room.
While the less-is-more trend is unlikely to affect the conventional property market, tiny houses make a lot of sense on a number of fronts:
Firstly, they are more sustainable for the environment, with less building materials needed and greatly reduced power bills over the lifecycle of the home.
Secondly, they align with the minimal style aesthetics of the modern age, with neat and well-considered design increasingly preferred over excess.
Last but certainly not least, tiny houses are much cheaper, which is a major consideration for young people and first-time buyers who want to live in expensive modern cities.
These cost savings come with a number of lifestyle advantages, with a smaller sale price meaning a greatly reduced mortgage and fewer years living in debt. Tiny houses are also popular with retirees who are looking to downsize and simplify.
What is a micro condo?
The tiny house movement has allowed us to rethink the size and function of our homes. The central ideas of this movement are relevant to all dwellings, from detached family houses through to townhouses and condos. Even before the "tiny house" movement was a social media trend, we have been seeing reduced living spaces and greater urban density in many western markets.
If you want to live in the inner-city surrounded by fantastic public spaces and amenities, reducing the size of your private space is the obvious solution.
A micro condo is just that, an owned unit or apartment that's much smaller than average. While the average tiny house is about 500 square feet, the average micro-unit is much smaller at 200-400 square feet. While this may seem minuscule on paper, clever design choices, large windows, and high ceilings often make these units look much bigger than they actually are.
While most people want a self-contained condo, there are multiple examples of co-living communities with a private bedroom and shared amenities. The target market for micro-units is young people, with single professionals in their twenties benefitting the most from this style of living. Depending on the size of the condo, however, micro-living is also possible for young couples and retirees.
According to a study by the Urban Land Institute (ULI), nearly 1 in 4 people who rented conventional units expressed an interest in renting a micro-apartment. On average, people would be willing to sacrifice space for 20-30% savings in rent, a more desirable location, and the ability to live alone. Whether it's New York, San Francisco, or Toronto, some urban markets are simply too expensive to even think about without going small.
One well-known example of rented micro accommodation is Havemeyer, a community located in Brooklyn’s hip Williamsburg neighborhood. This community is comprised of 51 residents and 12 suites. In exchange for monthly rent, residents get access to a private furnished bedroom, shared lounge rooms, shared bathrooms, shared laundry rooms, and shared kitchens pre-stocked with supplies. While this managed style of micro-living is only one example, it highlights the changing shape of inner-city living in modern-day North America.
Most micro-units are more conventional in nature, with residents either renting or owning private self-contained apartments. While the kitchen, laundry and bathroom areas are generally much smaller than average, residents are much more likely to live close to restaurants, dry cleaners, and large public spaces. In many ways, the move towards micro-apartments mirrors the inner-city migration currently experienced in many American and Canadian cities.
According to the US Census Bureau, cities and urban areas are now home to approximately 80% of Americans. This number is only likely to increase in coming years as populations rise and agricultural and natural environments are protected. Suburban sprawl is not just unsustainable, it's becoming increasingly unfashionable as people look towards an apartment-based and European-inspired way of life.
While smaller apartments are very popular with renters, they're also a hit with people who want to buy a condo and take ownership of their living arrangements. According to the same study, 37% of people renting a micro-apartment would consider purchasing their apartment if they were given the chance. Micro condos also present a very interesting investment opportunity, with existing micro units having higher occupancy rates and healthy rental prices for their size compared to conventional units.
Buying a micro condo
There are two separate but related real estate markets for micro condos: people who want to live centrally and are prepared to make compromises when it comes to space, and people who are actively seeking a micro condo regardless of location. Despite the growing micro trend, according to ULI, 82% of survey respondents said they were seeking a central location rather than intentionally seeking out a smaller unit. There is also a growing third market of people who want to buy a tiny inner-city condo for weekend getaways.
If you want to buy a micro condo, most opportunities exist in inner-city areas. For better or worse, certain neighborhoods have become known for their high prices and tiny footprints. The first step, as always, is about defining your needs from the apartment with regards to occupation and/or investment. While micro-units can work on both levels, the decisions you make will depend on your overall goals and financial constraints.
Living in a micro condo
Living in a micro condo can be challenging, especially if you're used to living in a large house. It's mostly a matter of adapting your habits and changing your mindset, however, with a well-designed micro home able to transform itself and change its functionality at the touch of a button. As they say, you can only live in one room at a time, with micro condos putting this popular saying to its ultimate test.
While a badly designed micro-unit is defined by lack of space alone, a well-designed micro condo is defined by what it adds to the space. In order to be successful, extra-small spaces need to be innovative and clever. From smart sensors and self-transforming furniture through to hidden storage and smart technology, there are lots of ways to add comfort, style, and value in a tiny package.
Storage areas under beds and sofas
Murphy Beds that hide in the wall during the day
Transforming sofa-beds and other furniture
Smart home technology to automate transformations
High ceilings to leverage vertical space
Multi-purpose sinks and counters
Space as an illusion with windows, mirrors, and lighting
When you get it right, micro-living can help you to become more efficient, less wasteful, and more thankful for the things you do have in your life. While the sheer lack of space can be stressful at times, many people who live this way say it helps them to live a more centered and sustainable way of life.
With greatly reduced space for storage, you're less likely to buy things you don't need and more likely to appreciate the limited space you do have.
Investing in a micro condo
If you're interested in investing in a condo, the growing micro-market provides a number of opportunities. Whether or not it's a good idea to invest in a micro-unit depends greatly on where you live. For the most part, micro condos make good investments in already heated property markets with a young and strong inner-city focus. Think of places like Toronto, New York, and San Francisco. When the market is young and space is tight, micro-living almost happens by accident.
Whether you want to generate rental yields or capital growth, micro condos can be a solid choice for the following reasons:
Desirable central locations - Micro condos are normally located in trendy inner-city neighborhoods, and as they say, location is everything in the property market. Investing in a micro-unit may be the only way you can afford to invest in particular cities or locations without busting your budget.
Expansive and emerging rental market - If you want to generate rental income, micro-units can be very profitable. They appeal to many tenant groups, including the emerging student and youth market and the growing retiree market who want to downsize. With the rise of Airbnb and the sharing economy, you may even be able to rent out your condo on a profitable short-term basis. According to Realtor.com, micro-apartments in Atlanta, Austin, and Denver rent for around $3–$4 per square foot. In New York City, the going rate is 2-3 times this amount.
Lower barriers to entry - Micro condos are not just short on space, they're also short on price. While it will always cost you to invest in a trendy neighborhood, you'll need a much smaller down payment and will benefit from a greatly reduced monthly mortgage. With lower sales prices, micro homes are not out of reach for many singles, young couples, and first-time buyers.
Strong capital growth - Depending on where you buy, micro condos can provide very healthy capital growth over time. While the same rules of real estate apply for the micro market, the combination of a solid location and a low sales price opens the door for so many investors. If you want to hold a property, it's important to avoid oversaturated markets or those without a young demographic.
Tips for designing and living in your micro home
Condo arrangements vary widely, with some pre-construction condos allowing you to customize pretty much everything and others providing basic templates and options to choose from. While most micro units come pre-packaged to some degree, there may be some room to move both before and after the sale. If you're buying a pre-construction condo, this should be a significant factor in your decision.
Most condo owners have the freedom to renovate their apartments after the sale, with a few clever designs and build choices able to completely transform how you live. Whether you're customizing a new build or renovating an existing unit, let's take a look at some common best practices when it comes to micro life.
1. Storage, storage everywhere
When you live in an ultra-small home, everything needs to be part of your storage solution. While under beds, under stairs, and under sofas are the most obvious options, you can also store your bed in the wall or your table in the floor. While you will have much less storage space, your home will also be neater and easier to manage.
2. Multi-purpose everything
In order for a micro condo to work, each element of the design needs to have multi-purpose functionality. There's no reason to have both a bed and a sofa, after all, how often do you use them both at the same time. There are many other ways to improve functionality without adding space, including office desktops that transform into dining tables, and beds that fold up into walls.
3. Focus on the outside
If your space is really small, you probably don't want to focus on it. There are lots of ways to expand your horizons, from large windows and matching mirrors to clever lighting solutions. While you can't always alter the size of your windows in a condo, you can replace heavy fabric curtains with blinds and streamline the overall appearance. More than a cliche, painting your walls white is a great way to make your space look bigger.
4. Use all of your space
While it might sound obvious, micro condos demand all of their space be utilized. That doesn't mean cramming things onto every surface, but thinking clearly and making intelligent design decisions. You can mount your TV and other electronics on the wall to eliminate their footprint, use vertical shelving in your kitchen, and add wall storage solutions in toilets and other little-used spaces.
Purchasing a micro-unit offers numerous advantages over conventional housing. Not only are micro condos cheaper and easier to access for most buyers, but they also allow you to buy property in locations you couldn't otherwise afford. Whether you're looking for somewhere central to live, seeking a desirable location to rent out, or searching for a property to build equity, micro condos offer financial and lifestyle rewards that are way more significant than their size would suggest.