My wife and I also live in earthquake prone suburbia in a one bedroom 700 sqft condo. We have plenty of room for bulky food and water storage. You just have to prioritize your storage space. Hmmm old tennis rackets and holiday decorations or food and water...tough choice. One other approach we have used is under and behind the bed and behind our bookcase. Hell, I bet superpails (6 gallon buckets) would make great end tables to the modern survival decorator. My wife vetoed the latter idea.

Get creative is the bottom line...most of us have too much crap that could use a little prioritization. The biggest short coming to a small place I have noticed is fuel storage for heating and cooking. The only solution I have found is a couple gallons of denatured alcohol/methanol for my camping/backpacking stoves and a solar oven. Large propane, diesel or gasoline storage tanks just isn't feasible for us condo folk.

If you need a good cheap outlet for long term food storage check out: survival acres out of Washington state. We have purchased all of our food here.

The owner is a bit of a ranting TEOTWAWKI type survivalist but he is very friendly and has the best prices on food + shipping around. He has some good food plans and is very up front about stating the deficiencies of the plans (namely fat, oils can be bought separately in gallon sized containers at supermarkets to fill the gap).

Good luck!
Cheers,
Nemo.