In 2021, the city of Portland officially legalized living in mobile dwelling units on private property. MDUs include recreational vehicles and tiny homes on wheels, which are different from accessory dwelling units, or ADUs. According to a recent survey reported in Sightline Institute, MDUs have been seeing an increase in popularity since 2020.
Kol Peterson conducted the survey, owns Accessory Dwelling Strategies and is an ADU and MDU expert. He joins us to explain more on MDUs and why they are growing in popularity.
Note: The following transcript was transcribed using AI and validated for accuracy, readability and formatting by an OPB volunteer.
Dave Miller: This is Think Out Loud on OPB. I’m Dave Miller. For years now, accessory dwelling units, or ADUs, have been seen as one of the ways to increase density and housing options in cities with a major shortage of those options. My next guest is a major champion of ADUs. Kol Peterson is the owner of a consulting company that helps people build them, and he pushed for the policies that allowed for more ADUs in Portland. But he says that now, another form of small homes, mobile dwelling units, or MDUs, is quietly transforming the housing scene, and he joins us now. It’s great to have you on Think Out Loud.
Kol Peterson: Thank you so much for having me.
Miller: What falls into the category of an MDU, a mobile dwelling unit?
Peterson: Pretty much anything that would be legally classified as a recreational vehicle, which includes both what we think of when we think about travel-oriented RVs that you see parked out on people’s driveways, but also tiny houses on wheels. So what we are enabling is basically people to live in these low cost forms of dwellings that are on wheels, whether they’re RVs or tiny homes on wheels.
Miller: How did the city’s approach to these mobile dwelling units change over the last six years or so?
Peterson: Back in 2020, the city went through a regulatory reform package that looked at a number of different issues. It was called the Shelter to Housing Continuum Project, and in that set of provisions they basically legalized this form of dwelling at that time. And it was truly the first city in the country to do it, and it still remains, to this day, really the first big city to allow it.
Miller: So what exactly wasn’t allowed before that is allowed now?
Peterson: This is kind of a weird thing because what I’m gonna say right now is gonna sound so “no duh” to so many people. You are not allowed to live on your own property in things that are not legal bedrooms. You cannot live in your own backyard in a tent or in a yurt.
Miller: Huh.
Peterson: Yeah, wild, right? Even though you own the property, you cannot use it as you wish because the laws do not allow for us to do that. And Portland made the bold step of saying, for this one form of dwelling, we’re going to make an exception to that rule. We’re going to say, if it’s on wheels, if it’s a recreational vehicle, you can in fact live in this thing that isn’t a legal permitted bedroom. That doesn’t sound like a big deal, but it’s a very, very big deal.
Miller: You said it sort of quickly. This was called the Shelter to Housing … what was it called?
Peterson: The Shelter to Housing Continuum Project was a way to legalize a series of reforms that had been put into effect in the city of Portland under the emergency housing declaration that was made 10 years ago.
Miller: So then it was explicitly on the part of city leaders, a piece of their attempts to solve homelessness?
Peterson: You could say that. Among the other things that they allowed under this same regulatory package was the ability to live in single-room occupancies, for example. So it was, I would say, a low cost form of housing intervention. And also, there was other things that were being discussed to allow for encampments in certain conditions. But that wasn’t the issue that I was particularly focused on. I was focused on this kind of private market solution that was a very low-cost market solution option.
Miller: I’m curious about what you just ended up there, the low cost piece of this private market solution. I imagine that there are huge ranges even within each of these two categories, within MDUs of what kind of RV it is, what kind of tiny home on wheels it is. Certainly there are major price differences in terms of an ADU that somebody might build. They could be breathtakingly expensive, they can be less so. But in general, what might the average price differences between an MDU and an ADU be?
Peterson: This is the exceptional thing. So as you alluded to, ADUs can be, let’s say on the low end, $150,000 all-in for a garage conversion – least expensive an ADU can do. High end, $450,000. I just heard a story this morning about a 400-square-foot ADU in Los Angeles, $600,000. We’re not LA, we’re not Vancouver, BC, we’re not San Francisco, but our prices are now $300,000 on average for an ADU. It takes about a year, a year-and-a-half to do. Huge fan of ADUs. But it has crept up in cost, along with the rest of the residential housing sector.
MDUs, by contrast, are … Go to Craigslist right now, type in “RV.” Used RV with a kitchen, bathroom, $5,000. No joke. Do you want to live in a travel-oriented RV that’s kind of a cheap RV that’s $5,000? I don’t know. But the fact that you can do that is incredible. Now in practice, what we’re seeing is people buying cute tiny homes on wheels that cost about $50,000 to $100,000 on average. And in the upper range of that MDU market is kind of custom built, bespoke tiny homes on wheels that are about $200,000. So I’d say $5,000 on the really, really cheap end, to the more realistically average of $50,000 to $100,000 is the normal MDU price.
Miller: What about hookups? Are we talking here about an extension cord out the back of the house? Or are these somehow plumbed and a more permanent version of electricity?
Peterson: I have a company called Tiny Hookups, which is a general contractor. We do legal permanent infrastructure for these units. We know these costs really, really well. And the average cost ends up being about $10,000 to $15,000. What it looks like are basically a legal sewer extension on your property, much like you would do with an ADU. It’s a 50-amp outlet that you put in that looks like an EV charger or like an RV sub panel. And lastly, a hose bib, which you can run off the side of your house or through a heated hydrant. So, all-in, if you’re putting in all three pieces of infrastructure, $10,000 to $12,000.
The other incredible thing here is that the permits, they’re instant, essentially. Same-day permits, inspections next week. We can do this job in one week, put in all the hookups. You can simultaneously go to Craigslist, buy your tiny house, bring it in, two weeks, wham, bam, thank you ma’am, done.
Miller: Permitting, how much time might it take for an ADU? And I say this after having innumerable conversations with city leaders for years where they’ve said, “We’re going to streamline this process.”
Peterson: A lot of buzzwords.
Miller: So it hasn’t been streamlined?
Peterson: We are like the leading city in the country with ADUs along with Los Angeles, so we’re doing amazing stuff. But housing is expensive and regulations are incredibly complicated. You need to be an engineer at this point. You might as well be building a spaceship to be building a house in America, it’s so complicated, the amount of bureaucracy involved, the amount of regulations and codes involved.
So it’s like a three-month process to go through the design. Let’s say three months for permitting on average for a detached studio, and let’s say six months for construction. If you are lucky, one year from start to finish. By contrast, MDUs is like three months max. Maybe two. I mean, it’s really fast.
Miller: It is worth saying again, and you’ve acknowledged this, but we’re not only talking about money here … The difference in the living experience, I imagine, for the $5,000 RV that you’re talking about getting on Craigslist and having up and running six days later, it’s probably gonna be very different from the nice ADU that you designed yourself and for which you’re paying 50 times more.
Peterson: Totally. And I personally would not choose to live in a travel-oriented RV. I would live in a nice tiny house on wheels. I own a tiny house on wheels, costs $50,000. That’s what I would choose to do if I was doing it. But we have the span of clients. I’d say almost all of our clients are putting in tiny houses on wheels if they’re doing this. And part of my market-based pitch on this is people have $500,000 properties on average, they’re going to want to put in a nice looking thing in their backyard. They’re not going to want to probably have a $5,000 RV. But some people might need to for their homeless dad who doesn’t have a place to live. And they don’t really want to house their dad, but they have to and they don’t have $50,000 to spend. So they might go buy an RV.
Miller: You did a survey recently in the Cully neighborhood in Northeast Portland. What did that survey entail? What were you looking for? What were you doing?
Peterson: So we did [what] I would call a windshield survey where I biked by every single residential property in the Cully neighborhood. I’ve done this three times now in 2020, 2024 and 2026. This time I did it in conjunction with the Sightline Institute.
Miller: And that’s how I should say that we heard about this, from an interesting article that they published.
Peterson: The findings of that survey have been that in 2020, there was about 60 occupied mobile dwelling units. In 2024, there was about 90. And as of this year, about 120. So it’s about doubled altogether since 2020, which is a pretty dramatic increase in occupied dwellings. And if you want to know about the methodology that we use, read the Sightline article. It’s a great article, it goes into a lot of detail about that.
But the bottom line is we were just trying to do an informal survey to determine how popular is this housing solution? Because among other interesting attributes to this form of housing, there is no way to do a query against the city’s database to determine how many of these things are out there. Which is very atypical compared to, say, an ADU.
Miller: Because for those there are permits, and you can know how many permits were pulled and you can get a lot more granular data.
Peterson: Because they’re buildings. These are not buildings. This is like you have your car. The city of Portland doesn’t know about your car. City of Portland doesn’t know about your RV.
Miller: I take your point about the methodology, we don’t need to get into all of it. But I think to me, the biggest question that folks may have as you were going through this one Portland neighborhood and in a sense counting the RVs, were you including RVs that were parked on the street?
Peterson: No. And let’s be very clear here. What I’m talking about is not RVs parked on the street. And that is, unfortunately, the perception that a lot of people outside of the city of Portland and in the city of Portland who would think about this concept is immediately associated with the derelict RVs that are inhabited by homeless people, used because they are available for $1 because to dispose of them costs $5,000. So that is becoming the new really nice form of a tent that you can get for less than a tent, so why wouldn’t you live in an RV in the street if you can do it.
That’s not what we’re talking about. We’re talking about using private properties with legal hookups that have been permitted and approved, and thereby creating the way to safely connect RVs to the public infrastructure.
Miller: As you were saying, the city doesn’t have good data about the number of these RVs or tiny homes on wheels. So you were left with, every couple of years, doing this survey. And you found about a doubling in a relatively short period of time, five years or so. In that time, what did you see in terms of ADUs in the same neighborhood?
Peterson: In the last two years, the number of MDUs have outpaced the number of ADU permits by twice. The data here is so sparse, but the little bit of data that we have is pretty remarkable in terms of the fact that, without much governmental involvement, arguably almost none, this housing solution is apparently working in the sense that we are getting a significant uptick of them, at least in one neighborhood in the one city that allows it.
Miller: Is your best guess as to why just about money?
Peterson: I think it’s basically the new ADU in Portland. I was heavily involved in pioneering ADUs here. I lead the ADU tour, I taught classes for thousands of people, lead a real estate designation about ADUs. So I’m a big fan of ADUs. But the reality is people in Portland can’t really afford or justify spending $300,000 to $400,000 anymore. It doesn’t really pencil from an ROI perspective. Whereas, MDUs do. So if you’re thinking of rental income generating potential, this is absolutely the way to go. If you’re thinking about housing Mom who needs to be here for a few years to look after your new child, this is the solution for you. Because unlike an ADU, you can do this essentially next month. And then when she’s done hanging out in Portland helping you to raise your kids, you can sell the RV.
Miller: I’m curious about the M part of this. Obviously, a mobile dwelling unit. How many of them are effectively mobile? Or in your experience, if you go every couple of years looking at the same places, how often do these actually move?
Peterson: The article in Sightline does go into that in some detail. Again, it’s a very small data set that we’re working with. But yes, they do move. And I would say from my assessment of having seen 120 of these, I’d say they’re all mobile. These are all truly mobile. In fact, they have to be on wheels to be legally allowable under this regime of housing that we’re talking about.
Miller: They have to be, but I guess I’m more wondering how often they are. And you’re saying that a lot of them do move.
Peterson: I would say look at the article, but I’m gonna say like 10% to 20% of them would move on an every few year basis. It’s not all the time, but sometimes.
Miller: A Prosper Portland report about tax increment financing that I found online a few years ago, it found that mobile homes accounted for a higher share of housing units in Cully than in the city as a whole. It made me wonder how much you feel like you can extrapolate from your survey about this one neighborhood to talk about the rest of Portland?
Peterson: That’s a great and subtle question, so good on you for looking into that. Cully is in the neighborhood I live in, and one of the reasons I wanted to do that research there in particular. It actually does have a few mobile home parks, which is cool, and different than some neighborhoods that don’t. Portland has, I think, 11 mobile home parks and Cully has like three.
And I should actually mention just because I don’t want to forget to mention it, you can legally live in RVs in the United States, just not on residential properties. You can live in them in RV parks. And legally, you can live in them in mobile home parks too. So it is a legally protected class of housing under Oregon state law, in Washington state law, California state law. It’s just that there are not that many mobile home parks, manufactured housing parks or RV parks relative to the demand for low cost housing. As a result, most of those parks are full, especially in highly desirable infill markets. So this is kind of a market-based solution to provide the capacity to expand the geography in which these kinds of dwellings can be legally lived in.
Miller: And you’re saying it’s only in Portland where you can now live in these on your own property?
Peterson: There’s some caveats there, but yeah, by and large, that’s true. Under Senate Bill 1013, you can also live in these in counties that opt into allowing this. So Clackamas County is another example of a place where you can do this, as well as Lane County and Deschutes County. So Oregon is kind of leading the way on this, which is cool. But it’s still kind of just working at it around the edges at this point.
Miller: The classic phrase for people who don’t want certain developments in their areas because of their concerns, say, about property values or undesirable people coming to the neighborhoods, is “not in my backyard.” In this case, we’re talking about literally your neighbor’s backyard. Can NIMBY concerns derail this? Do I have any say on what my neighbor puts in her backyard?
Peterson: Not really, and you shouldn’t. I think one of the provisions under Oregon state law is that housing development has to be done under clear and objective standards. Oregon’s like the best state in the country for housing. Portland’s one of the best cities in the country for housing development. And that’s a foundational concept. Like, Dave, if you owned my property next door, I wouldn’t be able to do anything. And guess what? That was the case in San Francisco, and nobody can build housing in San Francisco, thus the affordable housing crisis in San Francisco. It’s by having clear and objective standards that I can do what I want on my property that allows me to, predictably, as a developer, build an ADU or build an MDU.
Miller: In a sense, the story you’re telling is that the city liberalized, it got rid of this prohibition, and a thousand RVs or tiny homes on wheels have bloomed, but the city has sort of stayed out of the way a little bit. Are you saying more needs to be done, or this is actually a quiet success story — city, stay out of the way and let it keep happening because something good is happening?
Peterson: Yeah, it’s both, Dave. It’s a really interesting thing. It’s a parallel housing form that doesn’t really crossover in a direct way to conventional housing. So it’s very interesting. Do I want the city to be more involved? Absolutely not. That’s why it’s working, because the city isn’t involved. Yet, on the other hand, we have no idea of how many there are in the city, because the city is not involved. I guess part of me would, in an ideal world, say, “Hey, city, you should charge a $5 permit so that you can track this housing form and know how many hookups are being installed.”
Miller: But do you really want more data, or do you want more housing?
Peterson: I want both.
Miller: OK, but what do you want more?
Peterson: More housing.
Miller: Kol Peterson, it’s been a pleasure talking to you. Thanks very much.
Peterson: Likewise.
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