For one Wanaka couple, smaller is better. Like many people in the Upper Clutha, Will and Jennie Croxford have snapped up a section in one of the area's new subdivisions and are hoping to move into their new home next week.

Unlike most new houses, though, there is no space for a guest room or a separate laundry. They have done away with a large bookcase and their stairs double as extra drawers.

It will be a significant shift down in size from their modest 120sq m house in Lake Hawea to a much more compact 29sq m home in Wanaka.

The couple are joining a growing number of people choosing to downsize and live in a tiny home, which is classified as anything under 30sq m.

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Inside, the house consists of one main room which contains the living room, kitchen/laundry and stairs leading up to the only bedroom, on a mezzanine.

A bathroom the size of a small en suite is accessed at the back of the kitchen and there is some storage underneath the stairs.

Even the size of the toilet had to be considered when designing the house.

Once completed, the house will be connected to a small carport by a deck.

"We are certainly going to be the smallest house in the subdivision but we will probably have the biggest garden," Mr Croxford said.

Inspiration for tiny living came after a cycle tour from Melbourne to Brisbane about three years ago, in which the goal was to carry the least amount possible.

"We were mostly tenting but once a week we tried to stay in a cabin and we couldn't believe how luxurious and spacious it was."

In an effort to be as efficient as possible with the space, the toaster and kettle have been downsized and most single-purpose appliances, such as the rice cooker, have been done away with.

"It's nice to have a rice cooker but you can cook rice in a pot on the stove top, so it's not really needed. We do still have a coffee machine, though. We've just got a smaller one now," Mrs Croxford said.

Even their beloved bike collection has been reduced from five to two and the second vehicle has gone. Tiny living was not for everyone and it was not a magic fix for the housing issues facing the Queenstown Lakes district, the couple said.

With the build costing about $200,000, going small was not alway a cheap option either, Mr Croxford said.

"It actually costs more per metre to build a house like this than it would a regular-sized house but what it does do is make you consider what you actually really need and want, so it can be built cheaper if that's what you want."

Unlike tiny homes on wheels, which are categorised as a mobile home, the Croxfords and their builders had to follow all the usual council bylaws and building code rules.

Builder Craig McConnell said it was the smallest house he had done but it was one of the most challenging and rewarding.

"You've got to think a lot more in the design phases, but when we started working on it there were little changes and we would discover spaces we could use, so it was one of the most challenging builds I've done, but also one of the most enjoyable."

Mr Croxford designed the house with help from architect and neighbour Barry Condon, of Condon Scott Architects, and he became so passionate about the process he is considering how he and Mr McConnell can turn the tiny home idea into a business.

"The idea is to prefabricate tiny houses which can be placed on a section anywhere and we think there are people out there who will really like the idea."

There is already a group trying to find a way to build a tiny-home village in the Upper Clutha and it is hoping to set up a charitable trust soon.

"If you think back to when I was a kid, anyway, no-one really had spare rooms and these days people can't even fit their cars in the garage because of all the stuff they have, so it's just about looking at how you can do things differently," Mr Croxford said.

tim.miller@odt.co.nz