I think you’re right in that a lot of people out there are and would be happy in smaller dwellings than is typical today - but I honestly can’t imagine trying to live in a space that small.

I, my wife, and our two children live in an 1,800 sq ft house. I have zero remaining space. In fact, we’re about to buy a shed to convert into an art space for our youngest. There’s just no way I could make something smaller than what we have now work without major lifestyle changes.