Is it possible that homes cost more because they're too big?

[Mowgli]

Variety of reasons.

The cost of building materials, labor, and land. The location and local housing market can also impact the cost of modern homes. In some cases, larger homes may be more expensive because they require more materials and labor to build, and they may also be located in more desirable areas where land costs more

 

[Amo Husserl]

I like to make Hawai'i its own special economy due to import costs affecting their housing market.
Two story homes are more cost effective but who is going to live in a two story house if they only need one to meet their needs?
More square footage, and location have a role in costs. Metro versus suburbs versus undeveloped areas have their role in costs.
Materials, labor and desire to make a profit for whoever provides these. Real estate can be tricky for development because of legality.
Private developers are looking to make a profit and if its determined profits are not good enough, there is no reason to build. Costs are involved.
Depends where you want to live too. Everyone in metro or well-known areas are already paying for benefit. Consider property taxes.
There are a number of things presently and overtime affecting the cost of housing.
You want a big house for cheap to steadily build equity and not become a casualty of gentrification, look at an unknown area and bite the commute bullet.
Big homes are great for parents trying to pay off the property and create generational wealth for their children.