In an effort to increase the number of people a city can house without ruining single family neighborhoods, Seattle has been trying out backyard cottages.
As someone currently looking for a good rental, I would totally live in one.
These cottages are small. According to city code they max out at an 800 square foot footprint and can be only 22 feet tall.
Though its not required, many builders (like the one above) are opting to use environmentally friendly building methods and materials.