The sagging economy is influencing home design as more home owners favor smaller indoor and outdoor spaces that are often cheaper to maintain. Forget the formal spaces that are rarely used. Home owners nowadays don’t want to waste space and want to use every square inch of their home.

Home sizes and lots continue to decrease as preferences grow for low maintenance property improvements, according to the American Institute of Architects Home Design Trends Survey for the first quarter of 2010.

“We continue to move away from the McMansion chapter of residential design, with more demand for practicality throughout the home,” AIA Chief Economist Kermit Baker said in a public statement about the survey results. “There has been a drop off in the popularity of upscale property enhancements such as formal landscaping, decorative water features, tennis courts, and gazebos.”

Instead, slightly more home owners than in 2009 say they want open space layouts, informal spaces, a finished basement or attic, and a single-floor plan, according to the survey.

Large, expansive homes, once on top of many home owners’ wish-lists, are being replaced with a preference for more flexible, open and informal layouts that are more conducive for families, Baker said.

But how can you ensure that small space doesn’t feel too cramped? I recently spoke with Jennie Norris, president of the International Association of Home Staging Professionals, who had several tips on how you can Make Small Spaces Bigger. Read some of her tips to get ideas.

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