Systems and methods that manage memory usage by a virtual machine are provided. These systems and methods compact the virtual machine's memory footprint, thereby promoting efficient use of memory and gaining performance benefits of increased data locality. In some embodiments, a guest operating system running within the virtual machine is enhanced to allocate its VM memory in a compact manner. The guest operating system includes a memory manager that is configured to reference an artificial access cost when identifying memory areas to allocate for use by applications. These access costs are described as being artificial because they are not representative of actual, hardware based access costs, but instead are fictitious costs that increase as the addresses of the memory areas increase. Because of these increasing artificial access costs, the memory manager identifies memory areas with lower addresses for allocation and use prior to memory areas with higher addresses.