I think there is a place for them, especially if zoning laws were changed. They would make a nice mother-in-law unit to add to your property. I fixed up an older 24" Airstream trailer, but I sure as hell would not want to live in it. I think tiny-niss has been romantized like living on the road, it sounds better than reality. I don't even especially like camping in the Airstream, but we live in a college town, if I hooked it up to the sewer line it might provide a option for a single college student.
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We live in a modest 2 bedroom, 1 bath home of about 1350 sq ft. It's a mansion for my wife and I now that the kids are all gone. Do I want to downsize to a 400 sq. foot box, no way!