Calling all Austin millennials—your fight with Austin's dog-eat-dog real estate market could be coming to a close as San Francisco-based tiny home manufacturer Villa, also known as Natomas Labs Inc., is expanding in Austin.

Drawn in by the city's growing need for affordable housing, Villa began its Austin expansion in July, as the first city the company is building in outside of California. The expansion is already underway—a vendor manager has been hired and the company said it is hiring for sales and other roles.

The company develops accessory dwelling units, which are small but independent residential dwellings on the same lot as a stand-alone home; they are small enough to fit in a backyard. The homes are made in local factories and installed onsite, which officials said help reduce cost.

Villa homes come in one, two and three-bedroom options from 440 to 1,200 square feet. Starting at $159,000 for one-bedroom, $239,000 for two and $289,000 for three, each figure factors in permits, foundation, utility setup and other costs.

(Villa)

Austin was chosen out of 100 total markets, with emphasis on population growth, home appreciation, income, zoning restrictions and housing demand. The company has seen a "profound" need in California—the units have a variety of uses: a home for relatives, a replacement for a retirement home or dorms, or a home office.

The company was searching for markets that need more lodging options—a strong need in a city like Austin, where the median rent is around $1,539.

Austin City Council relaxed regulations for ADUs back in 2015, reducing minimum lot sizes, removing parking requirements and capping unit size. Still, ADU's are not permitted in SF-2 zoned areas, which characterize single-family units.

The company expects the first units to be completed in Austin by next summer.