At first I didn't get what problem they were solving. After enough discussions with them, I understand: The problem that tiny houses are solving is having the financial advantages of living in a trailer without the social stigma that comes with living in a trailer.
It's a class perception thing. In America, if you want to avoid living around the poor or being perceived as poor, you have to buy an expensive house. This is why people buy more house than they need - so they can live in the right kind of neighborhood.
Tiny house communities are a way for astrophysicists and programmers to live in trailers without having to live around the kind of people who live in trailers. It's a social hack to get around the signaling cost of expensive housing.
I told them that I didn't think it would work long term, that eventually tiny house communities would be perceived as just another kind of trailer park. They said sure, eventually that might happen, but by then their kids would have grown up and the next generation could figure out their own arrangements.