I find nothing about this home actually nice; it definitely cannot be cheap judging from the designer interior and the fact that pretty much all parts are custom made. There are already very narrow shelters (I wouldn't call them "home", more like "cages") for the poor who cannot afford anything else and they do not look anything like that.
Having space is not just not-tackling-that-silly-psychological-barrier of claustrophobia but rather a luxury people will happily afford. Unless you will be partying and traveling ALL your life, you will spend a considerable amount of time in your home and especially in your bed; investing a good part of what you can afford in a nice home and a great bed is therefore a very smart decision for me. And it seems to be human nature to long for the feeling of having a lot of space, judging by what modern interior design typically does and by the fact that people will always get a place as big as they can afford instead of just splurging on a luxury 4mx5m one-room apartment.