So your solution is to move people into closets ... this is a non-starter. The idea fails everywhere it is pushed.  Look at Bozeman, MT or Las Vegas, NV.  Rather than fix the problem you propose a blind ... how about YOU go live in 800 sq. ft. and try to raise a family. Let's address the problem with solutions that help to elevate the folks taking the hit.  Tiny homes on postage stamp lots is nothing more than acquiescence.