Are tiny homes a cost-effective solution for homelessness? This Bay Area nonprofit thinks so

DignityMoves CEO Elizabeth Funk thinks that for the most part, the public agencies and nonprofits tasked with solving homelessness are going about it all wrong.

From the federal government on down, the focus — and the funding — has long centered on moving homeless people directly into permanent housing. The problem with that strategy, as Funk sees it, is there simply aren’t enough affordable homes available, and building new units takes years and can cost $1 million per door.

DignityMoves’ solution: temporary tiny home shelters, which can be erected in months for as little as $50,000 a unit. So far, the San Francisco-based nonprofit has developed five tiny home sites totaling 450 beds across California cities including San Jose and San Francisco. It has 11 more sites in the pipeline.

But despite offering supportive services, such sites sometimes struggle to place people in permanent housing, with some residents ending up back on the street. We spoke with Funk about why she believes DignityMoves’ “interim housing” model can still be a crucial solution to combat homelessness. The conservation has been edited for length and clarity.

Q: How does DignityMoves develop tiny home sites at a low cost?

A: We borrow vacant land that somebody might have plans for someday. It can be either private or public, so the land cost is zero. And that’s already half of the problem. The other reason we can do them cost effectively is because the state has declared an emergency. And if cities declare a shelter crisis, as San Jose has (and many) cities in California have, then it allows us to use more reduced building codes that are life-safety, but not a lot else. So we don’t have to do underground foundations. We don’t have to trench the utilities. We don’t have to plan for 100-year storms. And then the third one is we buy modular units from various manufacturers. Heck, you can buy a unit at Home Depot these days. So, relocatable cabins on borrowed land and emergency building codes, and wow, all of a sudden, you’ve cut a few zeros off of the cost to construct.

Q: How are the sites funded?

A: In some cases, especially in cities, like for instance, San Francisco — which was kind of stuck in the old thinking and felt like any money they spent on anything that’s not permanent was a waste of resources — our first community there was fully funded by philanthropy. Then we walked everybody through it, and they loved it. And now the city has adopted it, and is doing it on their own budget. Cities can come up with that capital money. The expensive part is then the ongoing operations and supportive services. And we know the single biggest gating factor to cities adopting this model is how hard it is to pay for the services. And so we spend a lot of our energy helping find sources for that funding.

Q: How does DignityMove’s “interim housing” differ from traditional group shelters?

A: Traditionally, shelter is meant more than anything to be a place to get out of the elements. And shelter tends to be what we call congregate, which is for cost efficiency, lots of bunk beds in a group, in a warehouse-type facility. It works to get you out of the rain, but it doesn’t work to help people rebuild their lives, because they’re still unstable. In the old world, where we had plenty of housing coming online, permanent housing, it was fine to have shelter, and then you get either back on your feet or you go to permanent supportive housing. But now that housing is so expensive to build, there’s this missing gap, and interim housing has developed in the middle as an alternative.

Q: How can tiny homes stabilize people’s lives?

A: It makes it much more likely that they’re in a mindset where they can then start to listen to the supportive service and start thinking forward. And you just can’t when you’re still in survival mode. We learned in eighth-grade science that when you’re in fight-or-flight mode, the blood literally doesn’t even go to the logical parts of your brain. Of course, you can’t figure out getting a job — even in a group shelter, where you’re still worried you’re leaving tomorrow, and you’re trying to figure out where you’re going to go next. It’s not until you’re stable and safe that now you’ve got a chance to start thinking about rebuilding and actually applying for a job or skills training.

Q: Why have cities only recently begun to embrace tiny homes?

A: There are such deep-seated commitments to permanent housing as the only dignified and safe solution. And that’s because we only measure how many people get to permanent housing. Well, those can be your metrics, they’re not mine. My metrics are whether people are on the streets and whether we’re allowing them to degenerate to the point of chronic homelessness.

Q: But tiny home sites sometimes limit how long people can stay, correct?