M.H.
I am addicted to those organize shows on TV (like Mission Organization) so this is from them, as my kids are not in school yet so the art projects are kept to a minimum :-)
The best suggestion I heard (and plan to implement) is to get a box for each child. One art box like these: http://www.tiny.cc/3UecK
and then get a magazine file or binder as well for school related things. You store everything in there and then when its full you and your child go through it together and decide what to throw out.
The thought is that if you have limited space that you will only keep what is really special or important.
Hope that helps!