The institute, which looked at 3,418 three-bedroom homes in England, based its findings on building regulations which have come into force in London.
The House Builders Federation says that bigger homes could prove unaffordable.
RIBA's Case for Space study discovered the average two-storey three-bedroom home for five people was 8 sq m (86 sq ft) too small.
It claims the shortfall in space is the same size as a single bedroom with a bedside table, wardrobe, desk and chair.
The most common new three-bedroom house was also found to be only 77% of the recommended minimum - the space equivalent to two double bedrooms.
RIBA chief executive Harry Rich
The institute's research was based on the 96 sq m (1033 sq ft) London Plan space standards which have just been introduced in the capital. There are currently no UK-wide standards.
'Cramped life' RIBA chief executive Harry Rich said new houses were causing some people to endure a lower quality of life. "Our homes should be places that enhance our lives and well-being," he said.
"However, as our new research confirms, thousands of cramped houses - shameful shoe box homes - are being churned out all over the country, depriving households of the space they need to live comfortably and cohesively."
The institute wants consumers to get better information from estate agents and house builders.
For example, it is calling for floor area to be included in marketing material and floor plans to include furniture, so that people can get a clearer idea of the size of a property.
The Home Builders Federation however, said that if new homes were built bigger, some people would be priced out the market.
"If you increase standards you're going to increase costs," said head of planning Andrew Whitaker.
"That's going to mean houses are going to become more expensive and we're already suffering from a lack of affordability for young people and first-time buyers."
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