Buying or Remodeling a Small Home

Guide G-411
Revised by M. Fahzy Abdul-Rahman
College of Agricultural, Consumer and Environmental Sciences, New Mexico State University

Author: Family Resource Management Specialist, Department of Extension Family and Consumer Sciences, New Mexico State University. (Print Friendly PDF)

Illustration of a small home.

Learning to live in less space is a challenge facing many Americans today and will be in years to come. The average house went from having 1,525 square feet with 3 people in 1971 to 2,248 square feet with 2.6 people in 2006, an increase in square footage per person over those years (U.S. Census Bureau, 2011). However, the average family will no longer be able to afford the three- or four-bedroom, two-story home of the 60s and 70s. Uncertain economic conditions, inflated home prices, higher energy costs, and increased maintenance costs have placed home ownership out of the average family's reach.

Many families and single individuals are considering the options of smaller lots, more compact homes, mobile homes, and multi-family units, including condominiums and townhouses. Many of these newly designed homes contain fewer than 1,200 square feet—some are even as small as 250 square feet. Some of the advantages of a smaller house are lower property tax, lower property insurance, lower heating and cooling bills, shorter commuting time due to location, and easier maintenance.

The Challenges of Small Space Living

The key to small space living is organization. A combination of well-designed storage, structured work habits, and efficient use of floor space makes the best use of what space is available. Families living in smaller dwellings will find themselves facing these challenges:

  • Keeping things simple. Expand space by getting along with the essentials. This may mean giving away seldom-used items and opting for simple furnishings.

  • Mastering the art of storage. Families must make the best use of the storage space they have, organizing storage to the point where everything has a place. They need to use wall space to its best advantage by organizing closets and cabinets so they are most efficient. Purchases should be planned so families buy only what they need and have room for. Families should buy multipurpose items so they only have to store one item rather than several.

  • Becoming a tidy worker. Concentrate tasks at work centers and put things away immediately after finishing.

  • Developing a respect for the people they live with. Each person in the home needs a space of his or her own, no matter how small it may be.

Adapting to smaller spaces is a challenge, but it does not mean that the household's quality of life must be sacrificed, or that you must spend excessively in order to get the right household items. Small dwellings can be comfortable and can offer as much livability as some large dwellings. Psychologically, some people prefer a smaller space because they feel it projects a feeling of closeness and warmth. Leonardo da Vinci is thought to have said, "Small rooms or dwellings set the mind on the right path, larger ones cause it to go astray."

Ideas for a Small Home

Whether you are buying, building, or remodeling a small home, think through plans carefully by consulting architects and doing your own research. Decide what you can do on your own to save on labor costs. Downsizing involves remodeling to create space or an illusion of space. Incorporate energy conservation measures to save energy costs in the long term, though the parts and installation costs may be large. Be aware of what improvements will raise property values, but remember that some improvements may raise property taxes at the same time.

Illustration of a person constructing a deck.

Major remodeling plans may include adding or converting unused areas (such as a porch, garage, attic, or basement) into a year-round living space. Other simple, less costly plans can also expand space. The following are some guidelines to help you create more actual or visual space in your home.

  1. Extending outside. The first consideration is the home's lot and outside living space. Because interior space is limited, it is important to consider expanding interior space to the outside using large windows or patio doors. Expanded outdoor space should be pleasant to look at and offer privacy to the occupants. If you are considering adding on to the house, be sure there is enough space on the lot to do so.

  2. Efficient, not crowded. The dwelling's floor plan should make the best possible use of the allotted space. Extra-wide hallways, closets that are too deep, poorly placed room openings, or odd-shaped rooms all waste valuable living space that can be put to better use.

  3. Flexible floor. For flexibility, all living areas should be on one floor so rooms can be used for more than one purpose. Look for fewer rooms, fewer walled hallways, and carefully planned storage areas to make small rooms seem larger. Opening up the ceiling area with cathedral ceilings or skylights also gives a feeling of space. Look for sound absorbent materials to provide privacy.

  4. Smooth traffic. Make sure that interior living areas are not broken up by traffic patterns. Plan doorways and openings so traffic goes through one edge of a room, not down the middle. Expand interior areas to the outside with glass. Since large expanses of glass are not energy efficient, place them on the south side of the house, use exterior shading, make the windows double or triple glazed, or carefully plan window treatments.

  5. Colors, lighting, and mirrors. The right combination of colors, lighting, and mirrors may provide the sensation of a large room and may also lower energy costs. It is recommended to have light-colored walls and dark-colored floors.

Consider some of the following ideas for specific areas of the home.

Kitchen and Work Area

Careful planning is more essential in the kitchen than in any other room. Not only is this room the most costly to build, a poorly planned kitchen can be difficult to work in. Plan the kitchen so it makes the best use of the floor space and storage areas. For example, the soffit space below wall cabinets can be turned into storage space for seldom-used items.

If you want to make only minor changes to improve a kitchen, consider buying some of the space-saving storage devices available at local hardware and variety stores. Incorporate as many other storage ideas as possible to organize your kitchen. In some cases, a complete kitchen redesign may be necessary. Consult a kitchen designer to help you make the best use of space. Build in appliances where possible, and open the room into another area.

Illustration of two people making improvements to a kitchen.

Dining Room

The separate dining room may become a thing of the past. To make better use of space, look for a dining area incorporated into either the kitchen or living room. This arrangement allows either area to be expanded into the other if extra space is needed. If you insist upon a separate dining area, make it multifunctional. Have it double as a guest room, study, or hobby room.

Living Room

Choose "The Great Room" idea where one room combines the formal living room and family room. This room should be designed so that different family activities can take place at one time. A well-planned furniture arrangement helps achieve this.


Like other rooms of the home, make the bedrooms multipurpose. A child's room can double as a play or study area, and an adult's room can contain a sitting or desk area. Bedrooms can be smaller when all the storage is built into the wall, closet, or bed. This eliminates the need for dressers and other storage units.


Because of the small size, clever design and a great deal of imagination are needed for a creative redo of a bathroom. When fixtures need to be replaced, choose streamlined styles in light tones to take up less room. If the bathtub is not important, remove and replace it with a clear acrylic-doored shower. This visually expands the room, making the shower area seem a part of the floor space rather than a closed cubicle.

Replace normal bathroom tiles with small inch-square tiles so they are in better proportion to the room's size. Place shelves on open walls and use rounded rather than squared corners on shelves and counters to take up less visual space.


Design laundry equipment into the kitchen or bath to eliminate the need for a separate room. Plumbing costs can be minimized by having the bath, kitchen, and laundry located near one another.

Lighting and Windows

Incorporate more light into the home, whether natural or artificial. A well-lit room appears roomier. Increase artificial light by using recessed lights, track lights, and other fixtures. Remember, fluorescent lights give more light and cost less per watt.

Concentrate on south-facing windows to take advantage of the winter sun. Converting or expanding a window area into a greenhouse increases light levels, expands the living space, and provides an indoor garden. Eliminating a small, awkward, north-facing window will help gain additional wall space. Before closing the window in, however, cover it to see what effect the light loss will have on the room. Replace an outside wall with a sliding glass door to increase light levels and to extend the room's activities outdoors.

In a bathroom, install higher, larger windows to open up wall space. They will increase light levels while adding privacy.

Skylights are a good way to add natural light. When increasing any glass area, be sure to take the necessary measures to ensure energy conservation.

Walls and Ceilings

Enlarging wall openings opens up space and creates larger, multipurpose rooms. If you do not want to remove a whole wall, make a large archway instead. Opening the dining room up into the kitchen or living room increases the use of space. You can even turn all three into one large area. Before you chop into walls, check to see which ones are essential support walls.

An alternative to expanding space horizontally is to open up vertical space. High or cathedral ceilings create a feeling of space. In some home designs, the flat ceiling can be removed to expose the rafters and roof line. The ceiling surface should then be insulated to ensure efficient energy use.

Other Storage

Organize bedroom closets by dividing the space into storage sections for a variety of items by using such things as bi-level clothes bars, drawers for small items, and sections for shoes and hats. Use the inside of doors for small items like ties and belts. Make use of space above windows and doors and under the bed.


Always do your research and consult an architect or contractor to be sure the change will not cause structural problems and will adhere to building codes. For instance, you may learn the importance of letting your neighbor know about your plans, designs that are more prone to burglary, and appropriate security steps. While living small can be better, it is certainly a challenge. Be creative with the space and you will find it has many advantages—less furniture to buy, less area to clean, less to paint and repair, less to heat and cool.


Anonymous. n.d. How to get more living space from the space you have. Home and Garden, August, 1979.

Daigles, C.W. n.d. How to live in less space and like it. Baton Rouge: Louisiana State University Cooperative Extension Service.

Pifer, G. n.d. Limited space living. Washington, D.C.: USDA Cooperative Extension Service.

U.S. Census Bureau. 2004. Historical census of housing tables - Home values.

U.S. Census Bureau. 2011. Median and average square feet of floor area in new single-family houses completed by location.

Wysoki, J.L. 1985. Making smaller homes seem larger [Circular 1239]. Urbana-Champaign: University of Illinois Cooperative Extension Service.

Original author: JoAnn Less, Extension Housing Specialist

Photo of Fahzy Abdul-Rahman

Fahzy Abdul-Rahman
is the Extension Family Resource Management Specialist at New Mexico State University. He earned his Ph.D. and M.P.H. from The Ohio State University. His Extension programs focus on various personal finance topics, from basic banking to retirement planning.

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Revised and electronically distributed October 2011, Las Cruces, NM.