Part of the reason is also that people are now more mindful of "private" space and "personal" space than ever before and so they are not used to having people living close enough where they have to interact with them on a regular basis.

That was not the case earlier where people who were related lived fairly close to each other. This is particularly true in places like Asia, Africa and parts of Europe even today.

Staying close together requires adjustment and also requires people to value the close proximity of others.. This is sadly something which has largely disappeared particularly in North America