I would happily live in a 150 sq ft shed if it kept me out of the city and the "fun". It's not that I'm not willing to make do with a small space, it's that I don't want to be tripping over my neighborsband dealing with their noise and idiosyncrasies.
The biggest problem with increasing density is noise. Some of it can be solved with better building standards, but that increases cost again.
And in western countries there seems to have been a general erosion of the kind of local level government authority you need to deal with the one household that is a chronic noise problem for the hundreds of people they disturb around them.
These discussions tend to gloss over the fact that more density is going to require tackling antisocial behaviour head on, and local government are neither willing or able to do so.
> The biggest problem with increasing density is noise.
Noise can be managed with sound insulation, but the biggest problem with density is the crowds. Big lines and waits for everything because there are so many people. I'm very happy to live in a borderline-rural suburb. No lines anywhere, no traffic, no waiting anywhere. It's so nice.
The stomping noises upstairs in my old apartment were from cars? And cars pumped Tejano music through my vents? (Didn't actually mind that one. They were very loud, but during reasonable-ish hours) I guess what I thought was a screaming child in the hallway was also cars. Crazy.
Most of the noise might be from cars, but the noise that makes me want to hurt people is from stereos and parties and dickheads with power tools at fuck off O'clock in the morning.
Edit: and motorbikes, fuck motorbikes. I'll give you that one.