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Hobbit-holes, otherwise called Smials, were the preferred dwellings of Hobbits in the Shire, the ancient mortal race inhabiting Middle-earth. They were holes dug into the hill side, usually having a minimum of one round window and front door and sometimes back door. It was the primarily wealthy families of Hobbits built Smials, spacious and luxurious tunnels, a souped up version of a Hobbit-hole. Brandy Hall is an example of a Smial and had three front doors, many side doors and around one hundred windows. Bag End, the home of Bilbo Baggins and later Sackville-Bagginses and then Sam Gamgee, could be called a Smial, as it was an expansive Hobbit-hole with many windows; a large circular green front and back door, and a large number of rooms; as well as the famously renowned pantries which supplied food for many a party or celebration.
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On the other hand, the poor lived in basic burrows with perhaps only a single window. An example of this is Bagshot Row. The famous Took family lived in the Great Smials, their ancestral home and many-tunneled mansion.During the Scouring of the Shire, many Hobbit-holes were destroyed and replaced with wooden shacks, towards the end of the Third Age.