Wire wall racks
Who says you can use wall racks in hallways or kitchen only? Ever since I shifted to London, I am using a wall rack for towel storage. The industrial look of my wall rack is quite impressive and they look great in the bathroom (if you have white-washed walls).
Fold all the used and spare towels and place them on the wall rack. To amp up the style, you can add decorative bits too. I have kept toiletries in the upper section and a small cactus plant adjacent to the towels.
Go for traditional peg rails
I have 6 towels, all in different colors. I like to display them freely as they indicated the vibrancy in my personality. However, I never had enough space, even in my previous house. I chose from a great selection of traditional peg rails. There are door-mounted peg rails as well as wall-mounted peg rails. I bought door-mounted peg rails as I have tiled walls.
I am a man of colors. Therefore, I applied some color blocking ideas and turned the old-fashioned peg rails into cool and trendy ones. 
Try wicker baskets
My family bathroom does not have a lot of space. My parents were always looking for a towel storage option until I brought home a wicker basket. Wicker baskets give you a country tidy country feel.
Just fold all the spare and newly-washed towels in squares and pile them in a stack to make the most out of the wicker basket.
In case you have a big family, make sure to have 2 wicker baskets, one for the washed ones and the other one for the dirty towels.
