So, I know that some people like the idea of a tiny house so that they can move out to their little plot of land in the country, living in the TH until such time as they can build their cob or strawbale home. The main drawback I see with that plan is the commute-- if you're still working the "day job".
As an alternative, my wife and I are exploring the "shared house" concept that Paul talks of in his "Permaculture Bricks" keynote speech video. Instead of cramming all your living into <250 sq. feet, we feel there's a place for sharing a 2400 sq.ft. home with 2 or 3 other couples (and maybe a few little-ones).
Check out this property we're looking at on Thursday:
We can actually afford the mortgage on our own, and we might start out by registering on airBNB as we look for permanent housemates, but the idea is to "stack functions" by sharing this as communal space.
Communal living also allows for savings of time and money in other ways that a tiny house on its own can't match.
Our goal is to stay near the city, so we can keep our "day jobs" for a while. The money saved in communal living will allow us to pay down our student loans and other debts, and then build the financial resources for a better piece of land further out from town. Perhaps some of our housemates will go in with us on the project, too.