Well, honestly it depends on the city. Tiny apartments like that are relatively common where I live in Seattle, and new ones are popping up all over the place. I don't know what the housing situation is there, but here they are so common because rents & house prices are shooting skyhigh.
My place isn't quite that small, it is around 300 sqft, but I found it just by checking out craigslist and trolling apt hunting sites.