During the first wave of COVID-19, residents’ health and well-being were challenged as residential environments suddenly had to accommodate most of the functions of an urban system. Although scholars and practitioners have proposed reconsidering dwelling requirements, their top-down approach overlooks the agency of residents whose preferences might have changed during the confinement. This paper investigates the effects of the first wave of COVID-19 on residential preferences in Switzerland. Adopting a systems perspective, we use an online survey of residents (N = 5378) to explore the extent to which the functions assigned to ideal dwellings have changed during the pandemic and relate these shifts to socio-demographic characteristics, changes in leisure activities, and respondents’ environment conditions. Results indicate that at least one ideal function changed in importance for 60% of the respondents. The desire for a place for self-representation increased, whereas a place for meeting basic needs evinced the largest loss in importance. Our regression models enable us to identify two profiles of residents who responded differently to residential stress. We argue that housing owners, practitioners and policy-makers should empower inhabitants to respond to current and future challenges by acting on and changing their residential environment for their health and well-being.