Tiny homes can be a great option for the minimalist lifestyle and affordability, but don’t let the cost of insurance take you by surprise. A new study shows a huge difference in the cost of tiny home insurance depending on where you live and the risks associated with that location. It’s still cheaper overall to insure a tiny home than it is a larger home, but insurance will take a bigger bite out of your housing budget if you live in a high-risk area.Hi I’m Kathy Fettke and this is Real Estate News for Investors.Tiny Home Insurance Cost AnalysisValuePenguin did a cost analysis that compared insurance for tiny homes and larger homes across the nation. (1) Tiny homes are generally around 400 square feet in size. ValuePenguin compared those to homes with 2,100 square feet. It found that on a national level, the average cost of insurance for a standard-sized home is 106% more expensive than it is for a tiny home. So tiny home owners are saving money on insurance, but will also be paying more than other tiny home owners if they live in certain states.The analysis found that the most expensive state for tiny home insurance is Oklahoma, due to the risk of natural disasters like tornadoes and severe storms. If you have a tiny home there, it will cost an average of 242% more to insure that tiny home than it would on average in the U.S. That said, ValuePenguin says it will still be 68% less costly to insure that tiny home than it would be for a larger home, in Oklahoma.Tennessee, Kansas, Texas, and Colorado are also among the least affordable states for tiny home insurance. And rounding out the top ten states for high-cost tiny home insurance are Kentucky, Alabama, South Carolina, and South Dakota. But regular homeowners insurance is also expensive in these areas due to the frequency of natural disasters.So tiny home owners may be saving money compared to their big-home neighbors, but not compared to tiny home owners in other low-risk states.Reducing the Cost of Tiny Home InsuranceValue Penguin suggests one way to reduce the cost is to opt for a percentage-based deductible. Choosing a 2% deductible might cost slightly more if natural disaster strikes, but the premiums will be lower than, say, a $500 deductible. It’s worth checking those figures if you are in the market for tiny home insurance, and it appears that a growing number of millennials and baby boomers are doing just that.In a tiny home market update by porch.com, it says that millennials are drawn to tiny homes because they are less expensive, offer location flexibility for remote work, and are eco-friendly. (2) Baby boomers also see an advantage to the tiny home as they downsize from long-time family homes, to something cheaper and easier to maintain.Zoning laws are also changing in places like California, to accommodate the tiny home or what is known as an Accessory Dwelling Unit or ADU. And companies like Boxabl are working on the manufacturing of pre-fabricated, fully equipped tiny homes that can be easily transported to their destinations, and set-up within an hour, like pop-up greeting cards. We just did a story on Elon Musk downsizing to a Boxabl casita. It’s episode number 1091, if you’d like to check that out.The porch.com analysis also shows where it’s the cheapest to buy a tiny home. North Dakota is at the top of that list, where the average tiny home is about $28,000. But if you go by the price per square foot, it’s Arkansas at $109 per square foot. North Dakota is fourth on the list for the price per square foot at $150. Boxabl casitas are just under $50,000.You can check out the data in more depth by following links in the show notes at newsforinvestors.com.And please remember to hit the subscribe button, and leave a review!You can also join RealWealth for free at newsforinvestors.com. As a member, you have access to the Investor Portal, where you can connect with a network of resources including experienced investment counselors, rental property providers, pro