It's just hipster hubris. If someone suggested building apartment blocks with the same square footage as those twee little houses, they would be accused of trying to warehouse the homeless, but it's actually a much better idea.
There's still the problem of services / jobs, of course. But that's a bit separate.
Of course, it's not as simple as that. Greenspace is important, which is why cities have parks.
It's ridiculous to suggest that services/jobs don't hinge on high population densities and efficient use of space.
And don't forget the very large paved roads to accommodate lines of parked vehicles on the side of the road (because naturally once you have a garage you just hoard crap in it and then park your three cars on the street) and all the armored tank SUVs passing between them.