I agree. But in many locations zoning doesn't allow you to build smaller even if you want to. This, to me, is a problem and counter to property rights.
Yes. People lobby government to "protect their property values" and succeed in making housing scarcer and costlier.
That's exactly the problem. The planners who want to engage in social engineering run up against property owners who believe it's government's primary job to protect their property VALUE, and they come to a consensus to zone out the poor. After all, only low income people would want a small house...