If it seems as though all of your prospects have become move-down buyers in this constrained market, try turning on the cottage charm. Trade in those stately manses in your portfolio for something more compact and cocoon-like, which are housing options that make today's buyers feel safe and secure, not overleveraged.

And be creative about where you look for inspiration. There’s no shortage of fine little structures out there with lessons to be gleaned on how to build a tight ship, be they primary residences, weekend retreats, granny casitas, or outbuildings. Some are traditional, some are contemporary, and some are vernacular blends. Here are ten worth studying.

Sea Breeze

Photos: Paul Dyer

Located in the foothills of the Santa Lucia Mountains with a view of the ocean, this 600 square-foot cottage (which complements a 2,800-square-foot main house) is not only therapeutic in its simplicity, it’s also eco-friendly. The shell incorporates recycled denim insulation in the walls, blown-in foam insulation in the roof, and low-E windows. Its interior is heated primarily by a central, high-efficiency, two-sided gas fireplace. Add to that a tankless hot water heater and energy-saving lighting, and you’ve got yourself a super-performing little cabin.

But passivity is the most important ingredient of all. When the weather is nice--the default setting in the Carmel Valley--windows and doors are positioned to grab prevailing breezes and keep the interiors cool. “This, along with shading from existing oaks, prevents the need for air conditioning in hot summer months,” says architect Jonathan Feldman. He adds that raising the foundation helped to minimize excavation and potential root damage to the trees.

Photos: Paul Dyer

Designed with versatility in mind, the structure is alternately used as a guest house, yoga/meditation studio, and social gathering spot for parties. The interiors are simple and clean, with Douglas fir trim (including the ceiling) and a rusted Cor-Ten steel fireplace surround as the centerpiece. The exterior is clad in stained cedar siding. Project: Carmel Cottage
Location: Carmel, Calif.
Architect: Feldman ARCHITECTURE 
Builder: Groza Construction

Learn more about markets featured in this article: Tucson, AZ, San Francisco, CA, Austin, TX, New York, NY, Coeur d'Alene, ID, Minneapolis-St. Paul, MN, Indianapolis, IN.

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