For some time, tiny houses have been getting all the attention as the exciting new home on the block. Maybe it was inevitable that a micro-apartment movement would spring up.

Of course, small apartments – often called studios – are nothing new. But space-challenged apartments lately are being marketed as a relatively inexpensive way to live in a luxurious way. The thinking goes, if the rent is too expensive for you in an affluent part of a city that you'd like to live in, why not pay less for a smaller space? That is, why not live in an apartment that is approximately 400 square feet or less?

A number of cities have been changing zoning laws to allow for smaller apartment sizes. Some of the cities in recent months that became micro-apartment friendly, or will be soon, include Milwaukee, Tampa, Florida, Detroit, Seattle and Minneapolis.

[See: 8 Apartment Amenities You Didn't Know You Needed.]

Micro-apartments have been good for communities, says New York City resident Mark Smukler, CEO and co-founder of Bixby, a tenant management web and mobile app for communication between apartment residents and property managers.

He says the smaller apartments can be built faster than the bigger ones, and at a lower cost, and it achieves a goal of providing affordable and low-income housing.

"While cities become more and more saturated, developers are looking for ways to maximize space, and micro-apartments are one solution," Smukler says.

Certainly, the term micro is apt. Four hundred square feet isn't insanely small; ApartmentTherapy.com compares that size to a two-car garage. But when you get to 300 square feet, 200 or even 100, you may feel as if the walls are truly closing in (because they are).

Still, because they make living in the big city affordable, there are a lot of additional benefits to a micro-unit, says Scott Bierbryer, co-founder and chief operating officer of an apartment search startup based in Philadelphia called VeryApt.

"We've seen a large trend of renters favoring walkability, access to downtown spots and building amenities, such as excellent gyms and cold storage for food delivery, over traditional home-purchasing criteria," Bierbryer says.

[See: 8 Big Budgeting Blunders – and How to Fix Them.]

But there are also negatives. Is this living small concept right for you? You should be asking yourself a lot of questions.

What will you get for your money? Obviously, you aren't paying for much space, but there may be rewards. Perhaps your commute is virtually eliminated, if you work downtown and a micro-apartment allows you to live there. Or you may find the features that come with your new digs help to offset the cramped quarters. For instance, in Milwaukee, a new apartment complex called Rhythm offers amenities in 405 square feet of space such as heated floors and a dining room table that transforms into a queen bed.

As for the actual money you will spend and save by living in a micro-apartment, it varies depending on the city and apartment complex. But generally, you'll usually come away saving several hundred or even a thousand dollars a month. According to data provided to U.S. News by Zumper.com, an apartment rental search website and app, the median price of a micro-apartment versus a one-bedroom apartment in April was as follows in these cities:

  • Philadelphia – a median 295-square-foot micro-apartment would likely cost you $745; a typical one-bedroom apartment: $1,360
  • Chicago – a 300-square-foot micro-apartment: $905; a one-bedroom apartment: $1,680
  • Boston – a 303-square-foot micro-apartment: $1,700; a one-bedroom apartment: $2,200
  • New York City – a 300-square-foot micro-apartment: $2,050; a one-bedroom apartment: $2,910
  • San Francisco – a 300-square-foot micro-apartment: $2,295; a one-bedroom apartment: $3,370
  • Honolulu – 309-square-foot micro-apartment: $1,500; a one-bedroom apartment: $1,800

True, the savings in Hawaii aren't too impressive. With only a $300 difference, it probably would be worth it to just get the one-bedroom apartment. But there's another money-saver with many micro-apartments, says Bierbryer: "The smaller units are cheaper to furnish."

Do you want a roommate or a pet? If you do, a micro-apartment probably isn't for you, unless that pet is a goldfish or perhaps a gerbil. Micro-apartments also don't allow much room for multiple people, although some retired couples like them, according to Denise Supplee, a Hatboro, Pennsylvania-based operations director and co-founder of SparkRental.com and co-educator at SnapLandlord.com, two websites that are educational resources for landlords and real estate investors.

She says a micro-apartment can be ideal for a retired couple living in warmer states during the winter that wants a little place to hole up the rest of the year.

Just don't be someone who likes to entertain and have a lot of guests over. That can get crowded, too.

[See: 8 Ways to Transform Unused Space in Your Home.]

How will your cleaning skills mesh with a micro-apartment? The small space could mean you'll stay clean and organized.

"It's easy to keep clean. Nobody wants to come home to something unkept and with 400 square feet, it's manageable," says Samantha DeBianchi, who owns DeBianchi Real Estate in Fort Lauderdale, Florida.

That's one way to look at it. But depending on your cleaning personality, limited space may make you more prone to quickly having piles of junk everywhere.

Are you a homebody, or somebody who is rarely home? If you don't go out much, the tight quarters may eventually get to you, but these homes are really good fits for singles or couples who really want to live in the city and young people who like to go out and who haven't accumulated too many things yet, say many industry experts.

"It's a great option for millennials … seeking an experience-based life rather than a product-based one, who see their home more as a place to lay their head rather than as their castle," Smukler says.

Still, for most people, the appeal of the micro-apartment is to save money.

"The college grad, newly starting their career, tends to spend more time out of the home than in," Supplee says. "So why spend an exorbitant amount of money? The micro or small living quarters is perfect, providing a place to lay the head, read and cook a meal, while still being around the nightlife."

Well, almost perfect, maybe. Don't expect much closet space. You'll practically be living in a closet.

Tags: money, real estate, housing market, personal finance, interest rates


Geoff Williams has been a contributor to U.S. News and World Report since 2013, writing about a variety of personal finance topics, from insurance and spending strategies to small business and tax-filing tips.

Williams got his start working in entertainment reporting in 1993, as an associate editor at "BOP," a teen entertainment magazine, and freelancing for publications, including Entertainment Weekly. He later moved to Ohio and worked for several years as a part-time features reporter at The Cincinnati Post and continued freelancing. His articles have been featured in outlets such as Life magazine, Ladies’ Home Journal, Cincinnati Magazine and Ohio Magazine.

For the past 15 years, Williams has specialized in personal finance and small business issues. His articles on personal finance and business have appeared in CNNMoney.com, The Washington Post, Entrepreneur Magazine, Forbes.com and American Express OPEN Forum. Williams is also the author of several books, including "Washed Away: How the Great Flood of 1913, America's Most Widespread Natural Disaster, Terrorized a Nation and Changed It Forever" and "C.C. Pyle's Amazing Foot Race: The True Story of the 1928 Coast-to-Coast Run Across America"

Born in Columbus, Ohio, Williams lives in Loveland, Ohio, with his two teenage daughters and is a graduate of Indiana University. To learn more about Geoff Williams, you can connect with him on LinkedIn or follow his Twitter page.

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