Tiny homes have existed ‘under the radar’. But changing rules are making the lifestyle more permanent

Kathryn McGoldrick had moved 15 times in five years when she decided to take the leap into tiny house living. But she soon realised it wasn’t going to quite achieve the housing security she had been yearning for.

The 66-year-old, who lives in the central Victorian town of Castlemaine, couldn’t park her tiny home on wheels on a property for more than 30 days unless she got a permit, which lasts six months and can only be extended for up to two years.

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That changed in July this year when the council, Mount Alexandra Shire, became among the first in Australia to allow its residents to live in a tiny home indefinitely.

Related: Matt Bruce poured his life savings into a tiny home. Now Byron Shire council wants to demolish it

It may just be the beginning of a broader change, as some councils shift their attitude about tiny homes on wheels. Still, local government is limited in how far it can take those changes because of state planning legislation, with most classifying tiny homes on wheels under the same rules as a caravan.

“[Tiny houses] won’t suit everyone,” says the Mount Alexandra Shire’s mayor, Rosie Annear. “But it’s an option a lot of our community are keen to have, and we know they would love for it to go further, but we’ve done what we can.

“I had chats with other councillors and mayors who were very interested in the idea, but were waiting for us to pull the pin first before they make their decision.”

The shire has changed its local laws to allow people to live in tiny homes indefinitely. But to adhere to the state’s planning regulation, the homes can only be a secondary dwelling, and there can’t there be a commercial agreement between the land and tiny homeowner.

Victoria’s Surf Coast council, which includes Torquay and Lorne, has followed suit. It plans to start a two-year trial this summer in the hope it will alleviate housing pressure. Nearly 70 have already expressed interest.

“It won’t fix the accommodation crisis that we’re having,” says the Surf Coast mayor, Liz Pattison, “but it’s one step we can take to help it.”

McGoldrick’s home is just eight metres long and 2.4 metres wide, and is nestled in a garden on the land where there is an existing house. The tiny home cost her about $100,000 to build, and she trades yoga classes with the landowners in exchange for parking on the property.

McGoldrick says tiny homes wouldn’t be for everyone, but it suits her want for a simple and sustainable home that is part of a community.

“For me it’s a good fit, it’s my home,” says McGoldrick. “The rules are vague but it’s very reassuring I can be here and not feel like there’s a deadline where I have to move again.”

In December, the Shire of Esperance in southern Western Australia developed a specific planning policy to allow tiny homes to be the primary and permanent dwelling on a piece of land.

The manager of the shire’s development services, Richard Hindley, says neither the council, nor the state, had rules that covered tiny house living, and it was only when a tiny home on wheels popped up on a piece of land that the council realised there was a gap in the regulation.

“We heard rumours of five others installed around the shire and we knew it was only going to get bigger,” he says.

Janine Strachan, the president of the Australian Tiny House Association (ATHA), says there are many Australians already living long-term in tiny houses “under the radar”.

Around three years ago, ATHA developed a specific planning policy and sent it to all councils in Australia in a bid to divorce tiny homes from the caravan category. And it is also working with counterparts in the US to draft a tiny-house-on-wheels construction code that could be adopted locally.

Strachan says councils following Esperance’s lead would improve safety for those people, such as setting bushfire standards. It would also avoid the possibility of people losing their home – such as a recent case in Byron Bay reported by Guardian Australia – when the council finds out about someone living in a tiny home or can no longer turn a blind eye.

But she says first and foremost, state planning regulation needs to change to give councils more flexility.

“We believe where a residential home is allowed, a tiny home on wheels should be allowed,” Strachan says.

From 2015 to 2016, Shannon and Fred Schultz were living under the radar in their tiny home on wheels on a friend’s farm near Echuca, and later Taradale.

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“There was always that fear we’d be found out,” Shannon says.

They later bought a two-bedroom house in Castlemaine, located in the Mount Alexandra Shire, once they found out their second child was on the way. They now use the tiny house as a spare bedroom and study.

“The cost difference when we were looking between a two bedroom house and a three bedroom was huge,” Shannon says. “So we were fortunate we could just buy a two-bedroom house because we were bringing our third bedroom with us.”

Shannon and Fred run Fred’s Tiny Houses, which educates would-be tiny house owners. They say that since the council changed its rules, people living under the radar in tiny homes elsewhere have been moving to the shire, and landowners have been openly offering their land for those looking for a place to park their tiny home.

“It shows people not only want to live in a tiny house, there are people who want tiny houses on their property,” Shannon says.