Living in a small space doesn’t mean thinking small. Everything you need, Kelsey Barnes says, is right outside your doorstep.

This mindset is one that Mr. Barnes and his family of five adopted early when they made the switch from a suburban, spacious home in Prince Edward County, to a narrow one-bedroom apartment in Toronto’s Distillery District. A military family, the Barneses are no strangers to change, but relocating to a city with a notoriously pricey housing market was not without its challenges.

“The fear and the panic came when they said we were posted to Toronto,” Jo Barnes said. “I knew we had to downsize, that’s a given.”

 
And downsize they did – to a 776 square-foot home that, after a bit of creativity, managed to fit them, their three children and their 80-pound Weimaraner, Nato, comfortably. When Nato passed away two years ago, Ms. Barnes said their “tiny condo with so many people” felt strangely empty. For the Barneses, space is what you make of it, and family is always the focus point.

The Distillery District condo has now been the Barnes’ home for five years, and after downsizing, Ms. Barnes said her family realized “how much you can live without.”

 
“We had three acres, 3,000 square feet, three couches,” she said of their previous home in Prince Edward County. “Who needs that?”

Now, the Barneses make do with a three-level bunk bed for their children – Kaden, 12, Karter, 10, and Hunter, 7 – tucked away in the condo’s den, and a shared kitchen and living room space with an island that doubles up as a dining table fit for five. For storage, the family uses rows of luggage that adorn high shelves around the condo to avoid clutter.

Most of the furniture was designed or built by Mr. Barnes himself, who has since retired from the military and completed an MBA at the Rotman School of Management.

Despite being previously posted to the Downsview area military base, Mr. Barnes said he was set on living in Toronto’s downtown core to give his family the full city experience. He briefly lived in North York as a 12-year-old when his father, also a military man, was posted in the city. Ms. Barnes previously lived in Scarborough. Both parents wanted to experience Toronto differently, and for them, they said, getting the most out of the city meant living in the middle of it all.

“Our condo is small, but the opportunities that are just outside that door are far greater than what we would get in a large suburban home,” Mr. Barnes said.

 
One look at the children’s room and it’s easy to spot that all three of them lead busy lives. Blue Jays and movie theatre ticket stubs adorn their individual cork boards adjacent to their beds, along with ribbons from marathon running events and other memorabilia.

Kaden, their eldest daughter, is currently enrolled in flight school at Billy Bishop Airport, pursuing her dream of becoming a pilot at just 12 years old. Their 10-year-old daughter Karter dreams of becoming a chef, and has taken cooking classes at George Brown College. All three children have also appeared as extras in Netflix series filming in Toronto.

Mr. Barnes maintains that the ability to easily connect with professionals in various industries in Toronto’s downtown made these opportunities possible.

Back at the condo building, the kids are “never bored,” Mr. Barnes said. The building’s communal space, equipped with a pool, a seating area and barbecues, act as the children’s own backyard, and the Barneses are not the only family that make good use of the space.

“The kids all get to play together, it’s very social, it’s very safe,” he said, and added the space makes it easy for other families in the building to interact with one another.

Making a small space with three children work does requires a bit of order, Mr. Barnes said. Each child has two drawers for their belongings, and individual hooks and cubbies in the condo’s narrow hallway. For gifts, Ms. Barnes said the focus is on experiences rather than material goods, to avoid clutter.

 
But tight spaces don’t come without their challenges. Mr. Barnes admitted having one bathroom is not always ideal, and the children naturally demand more space as they grow older. This, however, does not take away from the value condo living has provided for the Barnes.

“As a parent, everything is a teachable moment,” Ms. Barnes said, alluding to times where having the entire family in the kitchen can get quite busy. “You tell them, ‘You might as well help.’”

Condo living has become a reality for more and more families in Toronto, says city real estate agent David Fleming, as high prices and demand have made it less plausible for families to own a home. Mr. Fleming estimates the net migration rate for families moving into the city every year is three to four times the rate at which homes are being completed.

“Families in the future will have to consider condos from a strict supply and demand standpoint,” Mr. Fleming said. “There just aren’t enough homes unless people want to move out of the central core.”

Mr. Barnes shares this view. He said he often sees expecting couples in his condo building feel the pressure of moving to a more spacious house or town home, and advises families to consider condo living as a viable solution, despite the space constraints.

“We’ve done it here with three kids, and you just adapt,” he said.

The Barnes’s condo, 33 Mill St., unit 518, is now on the market, listed with agent Karyn Filiatrault with an asking price of $529,000. But Mr. Barnes said the experience of living in Toronto’s downtown has been priceless, and has shown the family “what the realm of the possible could be,” Mr. Barnes said.

“I did my MBA on a two-by-four piece of raw lumber … you don’t need a big space to do big things,” he said.