There’s no getting around it: increases in population density yield diminishing returns on quality of life. Returns may even turn negative if population density spirals beyond that which the natural ecosystem can support.
Quality of life must be balanced against human population growth. Life is expensive — my fear is if we don’t intelligently limit the number of humans alive, soon only the ultrawealthy will be able to afford having a reasonable quality of life.
Fewer people wanting to live their and those who do being less willing to spend a lot to do so is pretty much the definition of a backwater, so, no, its not really funny.
> Now the costs exceed the value of living there
To you, perhaps, but if that was generally true compared to the time you are comparing it to, fewer people would be paying the price to live there now than then.