While Lauren and Ryan Tracy were visiting his parents in Newport, Rhode Island, over the winter holidays in 2023, the couple’s then-toddler daughter, Renny, needed a car nap. Driving around Jamestown on the adjacent Conanicut Island, the San Diego family toured a dilapidated 1950s cottage for sale. Though the small home had “zero curb appeal” and a distinct cat-like smell, it did have an ocean view from the backyard, says Lauren. The price was also attractive: $265,000, a far cry from the overinflated California market they were used to. Having renovated several homes before with their design-build company, Shelter Residential, it was easy for the Tracys to imagine it as their next project: a summer home for their growing family (which now includes new baby Lottie and miniature bull terrier, Hank), located just 15 minutes away from the grandparents.

After purchasing the roughly 1,000-square-foot saltbox-style house, which had a flat-roofed extension, they began redesigning it as a minimalist gable home. Lauren and Ryan also wanted to explore passive design principles to make it as energy efficient as possible, all while staying within a $550,000 budget, home purchase price included. However, after opening the walls, they discovered mold all the way to the studs, learning it’d be a longer journey than they’d thought. The couple demolished two-thirds of the original structure before assembling a scant but mighty team of local consultants, with Ryan taking on a lot of the new construction himself to keep costs low.

Setback Requirements

Ryan: The front of the house was built with a zoning variance that allowed it to be closer to the street, so if we had touched that part, we wouldn’t have been able to secure a remodel permit. The facade was so ugly, but in the end, we just embraced it and said, Okay, let’s just take this shape and carry it all the way through, and make it like it look like a wool shed. In the drawings it looked like a mobile home. But when it actually came to fruition, it looked pretty cool.

Singled Out

Lauren: A lot of our neighbors scratch their heads, wondering why we didn’t do a second or even third story, which is common in our neighborhood and in New England, in general. When you’re close to the beach, people are trying to capture a view from an upstairs primary bedroom. We wanted to keep it small, simple, and low maintenance. I really wanted vaulted wood ceilings in the living and kitchen area, which we would have lost if we went up with another story. Instead, we worked within the existing footprint. We can still see the ocean from the living room, which is pretty incredible and something we don’t have in San Diego.

Ryan: A lot of our neighbors come by and tell us there’s a quirky vibe here, like an artsy vibe. People seem to appreciate it.

Lauren: Some do say the home looks “too California.” The style in New England is very colonial so our house sticks out a little bit, but once the siding grays out, it’ll fit in more.

Talent Scouting

Lauren: It was challenging finding local tradespeople. We thought we would hire a general contractor who would just bang it out for us, but we ended up subbing out most of the work ourselves. Ryan did a lot of the labor.

Ryan: That was a weird time to be here. Everybody was still trying to build their Covid projects, so nobody was available. I hired old friends’ dads who had already retired out of the construction business to come work with me. They were great and had a lot of knowledge. Then, at the very end of the project, I started meeting all these great consultants.

Pursuing Passive

Ryan: We’ve always targeted energy efficiency in our builds, and because this house is only 1,000 square feet, we decided to go all in. I’ve always been a building science nerd, so it wasn’t new to me. Everything starts at the foundation, but we couldn’t get rid of the existing one, so we dug down, wrapped it in foam, and then a waterproofing material. During framing, we focused on air sealing to keep things tight. We added five-and-a-half inches of Rockwool on the exterior of the house and insulated the inside. Even in the middle of the winter, just our bodies heat up the living room.

Lauren: It was tempting to do solar so the house could be off-grid. But right now, our energy bills are very low since everything is electric and the home is well insulated.

Pushing the Budget

Lauren: We got close to our $550,000 goal, but ended up splurging on certain materials. The Alaskan yellow cedar siding is pest resistant and will weather really evenly to a silvery gray, and the radiata pine wood ceilings in the living area add so much more warmth than drywall. Tadelakt, which is waterproof, covers the whole bathroom, so there are no grout lines to clean—we had to hire that out because it’s sort of an art. Another splurge was the big multislide window. It’s a 12-foot door with three panels that slide open. Our wood-burning stove was more expensive than any other option we found, but I feel it’s a focal point.

Ryan: We also had to spend $50,000 on an advanced septic system because we have no sewer hookup nor municipal water. Despite that, we rebuilt the whole house for about $300 per square foot, including its passive design strategies.

$14,200 Foundation	$22,400 Framing (Labor + Lumber)	$18,000 Siding
$12,000 Insulation	$3,000 Liquid Applied Vapor Barrier	$7,500 Wall Finishes (not including tadelakt)
$8,500 Flooring (including subfloor)	$12,000 Roofing & Gutters	$2,200 Hardware
$4,500 Electrical	$3,500 Plumbing	$16,000 HVAC
$23,000 Landscaping	$2,800 Kitchen & Bath Fixtures	$2,800 Lighting
$15,800 Cabinetry	$2,800 Countertops	$13,800 Appliances
$28,000 Windows & Glazing	$7,000 Doors	$8,000 Millwork
$1,200 Tilework	$16,000 Furnishings & Decor	$1,200 Permitting
$3,900 Architect Fee	$6,000 Demolition	$7,500 Waste Removal
$49,000 Septic	$4,600 Wood Stove, Triple Wall Pipe, and Chimney	$7,200 Tadelakt
$750 Shower Glass	$265,000 Land (with existing home)
Grand Total: $590,150

Open Living

Ryan: The biggest challenge was visualizing a functional family home within 1,000 square feet. We didn’t even know if the open layout would work until it was built. The floor-to-ceiling doors and windows in our living room make you feel like you’re outside all the time. Even on a cold day we can get sun, which warms the interiors. And on a nice day, we open the doors and have barbecues across the deck, yard, and house.

Lauren: It’s very comfortable despite the small size. We battled with the idea of maximizing the lot, but it just didn’t feel like us. We really valued the quality of the square footage over the quantity.

Project Credits:

Architect of Record: Fagan Design / @fagan_design

Builder/General Contractor: Shelter Residential / @shelterresidential

Structural & Civil Engineer: Merk Structural Consulting / @merkstructuralconsulting

Landscape Design: Fransson Landscapes / @franssonlandscapes

Interior Design: Shelter Residential / @shelterresidential

Cabinetry Design: Jeremiah Ray, Coastline Builders / @coastline_builders_ri