This is also the reason why performance is usually beyond terrible. Most of the cheap VPS hosts are extremely overprovisioned and not very well maintained. There may be the odd gem (I haven't tried alien), but $130 buys you a rackspace VM for a year nowadays, so I don't see the point of even bothering anymore.
You don't have to oversell like that. It doesn't change the fundamental, unavoidable fact that containers are a far more efficient way to virtualize than hypervisors for fundamental architectural reasons. An OpenVZ-based hoster that didn't oversell ridiculously would be cheaper and faster than a hypervisor-based host.
With a hypervisor you are running an entire kernel within a simulated machine within another kernel. That will never be more efficient.