I don't know where exactly you live, but for any house worth $600K, the land value is probably at least $400K.
The difference in cost between building a smallish 3 bedroom house and a hugeish five-bedroom house is quite small as a portion of the total cost (<$100K). On the other hand, in any major metropolitan area the difference between having a small backyard and a big one is huge. Hence, new construction tends to be huge houses on tiny lots.
The difference in cost between building a smallish 3 bedroom house and a hugeish five-bedroom house is quite small as a portion of the total cost (<$100K). On the other hand, in any major metropolitan area the difference between having a small backyard and a big one is huge. Hence, new construction tends to be huge houses on tiny lots.