Upvoting a factually incorrect comment because it sounds nice, and downvoting a factually correct comment because it sounds bad.
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I'm the blocked out poster in this.
You keep assuming that the living space is ~1500sq/ft for some reason; the houses I am talking about that are like this are not even half that size, but have 2 or even 3 car garages attached to them. Most of these are living quarters for field workers on the dairies and not even built to code.
Imagine a single 10x10 bedroom that has a kitchenette in it, and a room big enough to fit a shower, toilet and sink, attached to a 2 or sometimes even 3 car garage bay. That's what I see around here.
I mean, I'm not going to ask you to doxx yourself, but I'm extremely curious to know where you're seeing these homes that are, as you describe them, like 150 SqFt of livable area (10x10 studio + 5x8 bathroom) with an attached 3 car garage.
Edit: And to clarify, the 1500 was pulled out of an anecdotal average. My observations while shopping for homes here in the US have been; 2 bed / 1 bath, could be as small as 800 SqFt, but it's cramped. Whereas in middle-class suburbia, it's not uncommon to see 2500+ SqFt homes.
I've seen workers quarters like this in farms, oil fields, rural power plants etc. They're usually supposed to be for temporary or seasonal workers. Just a simple sleeping area + room for vehicles to drive to the jobsite.
I'm in a somewhat rural part of the central valley in California. Lotta dairy farms out here, and they have their own living spaces for the workers that are just absolute shitholes.
I think you're an unreasonable exception
Plenty of homes in rural NE that (while not as small as this) are still well within the 60% mark for garage ratio. They tend to double as workshops or large enough space for farm vehicle maintenance.
Considering the amount of rural settlements and farmlands / ranches around the US, I'd say it's not necessarily unreasonable. Can even find them in suburbia, albeit more rarely (have in-laws with the living space lofted over a full garage, which would put it at ~50% minimum before accounting for interior walls.)
This has the issue of always assuming a household will always live in the most space efficient way possible (2 adults in 1 bedroom with no children or others).
Assume you need 2 bedrooms (2 adults and 1 child): A 800-1,000 sq ft home in the USA is somewhere close to the 10th percentile in terms of size, so going down to ≤750 sq ft puts you near the absolute smallest 2 bedroom houses available.
The first house I lived in after college was 950 sqft. Three bedrooms. No garage. It was also built in the 50’s. It worked for three (and then later four) people splitting rent.
Today developers wouldn’t dare put such a house on the type of lot it was on because it couldn’t be profitable.