10 Nov 2026

Development plans for tiny house communities: legal, planning-related and honest

From KLEINER WOHNEN: The dream of owning a tiny house often falls at the first hurdle – finding a plot. After all, it is not the house that is the problem, but the land beneath it.

It is precisely at this point that many people have set out on a new path in recent years – and turned a necessity into an idea: the tiny house community. It is one of the most exciting answers to the question of how we want to live in the future.

And the key to this is a tool that sounds rather dry at first: the development plan. This article shows how such a community actually comes into being – what planning law is required, how the development plan process works step by step, which six stages lead from the initial dream to the completed house, and where, to be honest, there are still some snags.

Why now, of all times?

The broader context is well known: an acute housing shortage, limited land, and rising construction costs. Tiny houses aren’t the solution, but they are part of it – especially in rural areas, where they can help create affordable housing. In the city, this usually makes less sense.

Added to this is a second trend: more and more people want not only to live in small spaces, but also communally – close to nature, living with like-minded people and growing old together. They seek both closeness and privacy, flexibility and a sense of community. A single plot of land won’t solve this – but a well-planned development will.

Yet the persistent prejudice remains. For some local councillors, the phrase ‘tiny house development’ immediately conjures up images of scattered settlements, a camp of caravans and ‘people dancing naked around a campfire’. We’ve heard it all before. The good news is that these very concerns can be dispelled – if they are taken seriously and factored in from the outset.

The turning point: not looking for a site, but securing planning permission

The crucial shift in perspective is this: a settlement isn’t created by finding a meadow somewhere and putting houses on it. It is created by securing planning permission.

German planning law essentially recognises two areas. The ‘inner area’ is the contiguously built-up town centre – the village or town. The ‘outer area’ is, put simply, everything else: fields, meadows, woodland. In principle, building is not permitted there, with a few exceptions such as privileged agricultural use.

Building in the inner area sounds simple, but in practice it’s tricky: Most vacant plots are tailored for detached houses – it’s rare to find a prime piece of land large enough to accommodate an entire housing estate. On the outskirts of a town, a local authority can extend its inner area through so-called supplementary or local development by-laws. The most powerful and flexible tool, however, is the local development plan.

With this, the local authority establishes planning rights over an area – and can even create building land in the outer area. Here, a special zone can be defined that is precisely tailored to a tiny house development, or a traditional residential area. (And incidentally: under building regulations, tiny houses are treated in the same way as detached houses – building class 1. Wherever there is land zoned for residential use, a tiny house may, in principle, also be built.)

What a development plan contains

A development plan is more than just a colourful map. It consists of a plan drawing and a text section setting out the rationale – along with expert reports and appendices. The drawing specifies the location of various elements: green spaces, buildable plots, infrastructure such as car parks, and utility facilities such as a sewage treatment plant.

The text section sets out the regulations: type of use (residential, special-use area, mixed-use area, etc.), extent of use – i.e. how much of the area may be built on (floor area ratio, FAR) – building heights, setbacks, construction methods, transport, green and water areas, and in some cases also energy and drainage systems.

My practical advice: leave as much as possible open-ended – this allows for design flexibility later on – but specify as much as is necessary to ensure the local council and relevant authorities are on board. A height limit of 4.50 m, for example, allays concerns about a ‘high-rise on a greenfield site’ before they even arise.

The plan is drawn up by a development planning consultancy. We often recommend also involving a local firm that knows the community and its procedures – because traditional planning firms are used to large development sites, but rarely to the specific characteristics of a tiny-house community.

This text appeared in the annual magazine “Kleiner Wohnen” by Johannes Laible. The full issue is available HERE.

The text was written by Aurèle Haupt. Haupt (M.Sc.) is an engineer specialising in energy efficiency and sustainable construction; he lives in a tiny house himself and is the managing director of HAUPTSACHE TINY – a tiny house manufacturer in Mecklenburg-Western Pomerania. Together with his team, he supports settlement projects across Germany: from stakeholder workshops through the framework plan to project development. www.hauptsachetiny.de

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Matthias Jundt
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