I lost my tech job and couldn't afford my mortgage. Now I live in a 100-square-foot shed in the yard and rent out my house.

• Lauren Patton was confident that her well-paying job provided enough security to buy a home on her own.
• After she was laid off from her tech job, she eventually couldn’t afford her mortgage.
• To make ends meet, she built a tiny home in her backyard and is renting out rooms in her main home.

This as-told-to essay is based on a conversation with Lauren Patton, 36, who built a tiny home in her Texas backyard. The conversation has been edited for length and clarity.

After a couple of years of living in Chicago, I decided to move back to Texas and get a fresh start. This was in 2022, when the real estate market was booming, and homes in Central Texas were getting bought up quickly.

I found a real estate agent on Instagram, and she helped me buy a small bungalow — two bedrooms and about 1,000 square feet — for about $400,000. I was buying alone; it was just me and my dog.

I had made a very small down payment on my home and taken out a 30-year mortgage. My monthly payment was about $4,000, which was a lot at first, but I thought it was affordable given my well-paying job.

In early 2023, there were a bunch of tech layoffs. I found out the day after I got back from a trip to South Africa that I had been let go. I was given only two months of severance and sent on my way.

I could no longer afford my mortgage

For the first couple of months after I was laid off, I was OK. I took time to relax, spent time with my family, and did the things you don’t get to do while you’re working. Then I started looking for jobs.

I wasn’t super worried at first. I thought, “Hey, I was a data science manager. I’ll be able to find something.” But after interviewing at numerous places, nothing was happening.

By then, money was tight. I had very little savings and was still paying off a lot of credit card debt. I filed for unemployment, which brought in some money, and started renting out my home on Airbnb to help cover my mortgage.

To make this work, I rented a room for myself across town for about six months. But when my unemployment ran out, I had to start crashing on people’s couches and driving for Lyft— basically doing whatever I could.

Still, I had no savings, and I had cashed out my 401(k). I was terrified. My mortgage was just so much; I thought my home was going to go into foreclosure. I was already about 30% underwater on the home, and it had depreciated in value, so I still didn’t want to sell.

I was 35 and thought, “I can’t keep doing this.” I knew I needed to do something. That’s when I came up with the idea to build a little structure in my backyard to live in.

I moved out of my home and into my backyard

I wasn’t confident enough in my woodworking or carpentry skills, so I decided to buy a cabin-style shed kit I found out about on Instagram. I took out a loan and bought it for about $8,500.

While I was building the shed, I moved back into my main house and got a roommate to help cover the mortgage. I charged about $1,200 a month for the room. It wasn’t a huge portion of my mortgage payment, but it helped. Looking back, I regret buying a two-bedroom house, because there just aren’t enough bedrooms to rent out.

The shed is about 100 square feet, and the kit came with stackable wood slats, beams, and big windows, but it didn’t include a roof or a floor. I had to build the foundation, too. I also added an outhouse with an outdoor shower and built fences and other things around the property.

For the construction, I relied on YouTube and ChatGPT — though ChatGPT definitely led me astray on a few things, especially the roofing.

I officially finished the build in March 2025, though I’ve been making adjustments ever since — it’s never-ending.

Since moving into the shed, I’ve been renting out my main home full-time on Airbnb and have hosted hundreds of guests.

I let Airbnb handle the pricing. On a typical weekend night, I charge around $200; on a weekday during the school year, it’s closer to $125.

October is especially lucrative because of the Austin City Limits music festival. This October, my home had about 96% occupancy, and my gross earnings were about $6,516.70. That’s not normal — occupancy and nightly rates were higher — but Airbnb deducted $619 in service fees. I also had the home cleaned seven times for about $100 each time.

I put some of the money I earned toward my mortgage and bills for the shed — my total electric bill, including the shed and the house, is $550, which also includes other utilities.

But overall, Airbnb doesn’t cover my full mortgage, which increased by $400 a month this year because of home insurance.

Living in the shed has been difficult

It was tough at first, downsizing to a tiny home. Emotionally, it felt like I was regressing in life, and physically, it felt really claustrophobic. But I don’t mind it as much now. I’m doing better mentally.

I have most of what I need in a normal house — a TV, a desk, and a bed. But I have a tiny, itty-bitty fridge, and I don’t have ice or running water, so I have to stock up on jugs of water.

I’ve had to learn a lot about how to live in the space. When I first moved in, I had a portable air conditioner, and the humidity would reach 80%. I’d wake up soaking wet and think, “What’s going on?” I’d never had to consider something like that before. Now, I run a dehumidifier 24 hours a day.

The hardest part is remembering to keep everything I need on hand, because there’s always one thing missing. I’ll go to grill chicken and realize I’m out of salt, or that it’s back in the main house. I’m constantly running out to buy little things, and sometimes I wonder whether it’s really financially worth it.

Some days, I think, “Man, this is harder than I thought it was going to be.”

This has been a hard lesson

At this point, I’ve tried literally everything I can do to keep my home — I mean everything. If things don’t get better in the next couple of years, I’ll be comfortable letting it go, because I know I tried my hardest.

Looking back, I wish I had done more research as a first-time homebuyer. Aside from a high mortgage, my house is also like 100 years old, so it often needs repairs. I thought I was handy and could do it all myself, but it really wears on your soul.

I also wish I had thought more about the financial worst-case scenario. You hear advice from your parents: Don’t let your mortgage take up too much of your income. I wish I had listened and hadn’t gone over that 30% threshold.

The next time I buy a home, I need to stay under it. I also can’t be so optimistic. I need to be more realistic, because this has shifted my life so much.

A couple of weeks ago, I started posting about my layoff and the shed on social media. It’s really taken off; I’ve gained around 12,000 followers on Instagram.

I’m really grateful. Most people have been so great and lovely. And while I haven’t earned any money from my reels yet, I’m working on it.

As for a job, I’m currently working on a data analytics project and am still walking dogs. My income from my jobs doesn’t cover my mortgage, but I’m just grateful to have a job at all.

I feel sorry for people getting laid off, and I can definitely relate. When I’m back on my feet and in a better place financially, I want to help as many people in similar situations as I can.

Read the original article on Business Insider

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