There are two common narratives that explain the super-sizing of the North American home.

One, the more optimistic, goes like this: Americans place a high cultural value on space and privacy. The growth of the suburbs and the spread of the automobile made that elbow room possible, and we attained a higher quality of life.

A cynical version goes like this: Americans are more shallow and materialistic than our cousins in Europe or Asia. We're addicted to our cheap oil and big garages for our SUVs, and we build McMansions as a form of conspicuous consumption.

Neither is quite right, because they both position culture at the center of change in our physical environments, and discount the role of pragmatic decision-making. The truth is that what we (supposedly) want is always conditioned on price, available options and trade-offs. And we have spent decades making it really hard to build smaller houses, and making it really cheap to build big ones by pushing much of the cost off into the future.

Minimum lot sizes are pervasive in suburbia and even many central cities. Research finds these rules actively require residential lots to be bigger than they would otherwise be. A large minimum lot size means you're paying for more infrastructure (more linear feet of sewer main and asphalt street, built by the developer of your subdivision and bundled into the price of a new home). It often makes no economic sense for a home builder to put a modest home, which would appeal to a modest-income buyer, on a large lot; so homes get supersized to match their yards.

Parking mandates are another culprit. A lot of "tiny houses," if you added an attached garage, wouldn't look a whole lot smaller than a typical 1950s home. Attached garages balloon the footprint of homes, but they also screw with the development economics so that more modest, affordable housing types don't make sense to build. The Sightline Institute recently published an eye-opening case study explaining how this works in Portland. The parking is expensive to build but isn't directly bringing in income, so the developer has to compensate with a bigger, pricier home. (ADUs and other "tiny" houses, where they're allowed, get around this by either not requiring off-street parking, or, often, being built on top of an existing garage.)

Until we deal with, at a minimum, those two pervasive factors—lot sizes and parking requirements—tiny houses will only be a niche product, because they'll only make sense (from the builder's perspective) in niche situations. Add to that that we tend to only allow these small homes on small footprints in places where the cost of land is highest (desirable, centrally-located older neighborhoods) and we tend to tack on regulatory requirements that raise the price, from complicated design standards to lengthy and uncertain approval processes.

So few get built, and then we tell ourselves, "The market obviously wants larger houses." And so risk-averse lenders finance larger houses at favorable terms, and cookie-cutter developers build larger houses because it's a proven business model, and the cycle persists.

We Need to Re-Legalize Variety

Let's get this out of the way: "tiny houses" and ADUs aren't for everyone, and they aren't a simple answer for every city with a housing affordability crisis: they're, so far, a drop in the bucket even in the best-case scenarios. They can absolutely help solve that problem, but their ability to also solve a couple different problems shouldn't be underestimated.