Type of Party: A dinner party works well in a small space. Invite only four to six people, which will keep the cooking manageable.
Preparing the Space: Move some furniture out of the living room to leave more space for guests to stand and chat. Put your end tables or bulky chairs in your bedroom and shut the door, then offer to take guests' coats and put them on your bed yourself.
Food: Don't serve food that needs to be prepared right before it's served; you won't have the elbow-room in your kitchen, and you'll have to attend to your hosting duties.
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