Everybody has room for an O-gauge layout. You may have to alter your perception of O scale though...
This portable layout is 30" by 48" and made out of a piece of hollow core door. I store it behind a chest of drawers in our bedroom when not in use. The track is old school O-27. You may not be able to run an SD70 or Big Boy on it, but if you REALLY want to run an O-gauge train, this will get you there.