Most Hobbit Houses are what Bernard Rudolfsky called "architecture without architects", built by handy people with a dream, like Simon Dale in Wales. He built his low impact woodland home for about $ 5,000 with the help of his father in law and a few friends. He describes it:
This building is one part of a low-impact or permaculture approach to life. This sort of life is about living in harmony with both the natural world and ourselves, doing things simply and using appropriate levels of technology. These sort of low cost, natural buildings have a place not only in their own sustainability, but also in their potential to provide affordable housing which allows people access to land and the opportunity to lead more simple, sustainable lives.
More at Simon Dale's site