Bilbo and Frodo are small enough as it is, but if they were even smaller they could live in this 10-inch-tall terrarium version of Bag End by FaceoftheEarth. This highly detailed, hand-sculpted house was made from reference shots from the movies. Adding even more realism is a living ecosystem of moss harvested from forests by its creator.
If you care for it properly, you can keep your terrarium healthy and green and thriving for a long time. This is a good thing, because this miniature hovel will cost you $375(USD). Luckily the seller provides some care instructions with your purchase.
You could probably find or make some tiny hobbit figures to finish things off.