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Really?
I thought this was more the case with flexible providers like DigitalOcean. My current provider charges 5,36€ per month for 4 cores (though I assume this corresponds rather to 2 SMT-enabled cores), 6 GB of RAM and a 400 GB SSD. It offers better latency for most players (obviously not for myself) and in most cases has been sufficient regarding performance.
Fair, it does depend on what games you're hosting. I often have multiple servers for different games running and some can use upwards of 10GB of RAM each when in use.
Highest I've had I think was an Avorion server that hit around 20GB of RAM usage with 5 or so players on.
I find that VPS cores are often very low performance cores, since they want high core density in their servers vs fewer high performance cores, and for games like Arma 3, Minecraft, Enshrouded, etc they really need high single thread performance to work well.