Smaller doesn't always mean less overhead. Small enough (250sqft w/ 3 people probably hits that bar) and you're constantly moving things around and cleaning things to make space for something else.
If you've ever cooked in a tiny tiny kitchen, imagine that feeling spread throughout your entire home life.
Small house to maintain, separation from neighbor, better commute. I'm curious how you came into this situation, and if you observe opportunities like this to have vanished since the 08 era? (You seem to have bought at the perfect time...)