Witold Rybczynski makes the case for smaller homes:
Smaller houses on smaller lots are the logical solution to the problem of affordability, yet density— and less affluent neighbors— are precisely what most communities fear most. In the name of fighting sprawl, local zoning boards enact regulations that either require larger lots or restrict development, or both. These strategies decrease the supply— hence, increase the cost— of developable land. Since builders pass the cost of lots on to buyers, they justify the higher land prices by building larger and more expensive houses—McMansions. This produces more community resistance, and calls for yet more restrictive regulations. In the process, housing affordability becomes an even more distant chimera.
The Dish 