This 26-year-old pays $0 to live in a 'luxury tiny home' she built for $35,000 in her backyard—take a look inside

In 2019, I bought a three-bedroom, 1,400-square-feet house in Atlanta, Georgia for $196,000. I figured I could earn extra income by renting out the spare rooms on Airbnb, especially since I traveled a lot for work and was rarely home.

Unfortunately, the bookings dried up in 2020. No one wanted to share a house with a stranger in the early days of the pandemic. My work travels also stopped, so I was living alone in a house that felt too big.

But that May, as I stared out the kitchen window into my huge backyard, something clicked: I could use that space to build a tiny home to live in, and fully rent out the main house.

Before getting started, I had to submit building, electrical and plumbing permits to the city planning office.

Then I purchased a shed from Liberty Storage Solutions and hired a local contracting team to pour a concrete slab foundation. They got to work in October 2020.

Overall, it cost me around $35,000 to build the home, which includes the prefabricated shed structure, labor and material costs.

Instead of taking out a bank loan, I cashed out $8,500 in stocks and put about $20,000 on my credit cards to pay for everything. I was able to pay off this debt last year.

While the house was being built, I rented out my primary home and rented a room from my neighbor for $300 a month.

After we finished building the 296-square-foot tiny home in March 2021, I immediately rented it out on Airbnb for a few months to recoup costs.

By charging between $89 and $129 per night and $1,300 for monthly leases, I was able to bring in almost $32,000 in gross rental income. And this January, I moved into the tiny home to save on living expenses.

Here are the monthly associated costs for both homes:

Total: $1,580

All of this is covered by the $2,725 I make from renting out the main house, which means I'm able to live in my tiny home for free.

I don't have friends over very often, but once the weather gets warmer, I plan to use the fire pit as a hosting area.

Having this home has given me a ton of real estate options, including rental income and backup housing for myself or aging family members.

I believe that tiny homes will play an important role in offsetting the global housing crisis. Last year, I gave a TEDx Talk about how they can help create a sustainable sharing economy for land.

In 2021, after realizing effects of vacation rentals on the real estate market in Atlanta, I stopped listing my properties for short-term rental on sites like Airbnb. Renting out more and more space for vacations means less space for folks who need long-term homes.

I've since decreased my portfolio and am renting to local students and low-income workers. My plan is to add an attached guest suite to the main home and provide even more stable housing.