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There are certainly other reasons but I can't think of them all off the top of my head... But just as one example I JUST created a title in my current game. Why? Well I'm a king, and I wanted to create the duchy title for my vassal who held the counties so I didn't suffer the gold/levy/opinion penalty for not being his direct liege.
1. Special Duchy buildings in your duchy, the one you intend to own forever. Okay, maybe two of them, since you're allowed two duchies.
2. Sane Succession. If you're in Confederate Partition, have one kingdom and several duke and counties - you should start by giving your prime heir, right before your death, your main Duke and County. Then, give EACH other heir exactly ONE duchy and a county inside it, and a barony inside the county. This will ensure when you die, that your primary Kingdom title and any remaining counties goes to your prime heir. I believe it's Confederate Partition that will create all titles able to be created to dole out - may as well create them yourself to get the prestige bump. You can give unwanted Duke titles to old people with no heir and no wives. I love this arrangement because I get the title back on their death, unless someone slips into that title's succession without me noticing.
Ah, but then you move from one limit to the other. Instead of "too many counties", you will get "too many vassals". You just can't win. Paradox has done EVERYTHING possible to ensure this is a game about having a SMALL realm, not a big one.
Your best option is to create maybe 1-2 Super Dukes who love you and have traits that align with you AND your heir. When you need to dump off burdens, give them to one of your Super Dukes. They will hit the domain size limit on their own (then they will dole out titles and hit the too many vassals limit instead). This will cause them a LOT of problems, but it's THEIR problem instead of your problem. When he revolts or whatever, remember that you have a sane realm to draw armies from and he has the 100% over domain penalty and too many vassals penalty.
So there is seemingly no inherent bonus which I didnt think of since I would still get more money from a direct vassal when im not the de jure holder than i would from the vassal when another vassal with the de jure title is between us.
Create titles if it would mean you keep land on succession (e.g. siblings will become vassals) or you are over your vassal limit and need to group some counts into a duchy.
Note, that most higher titles require that you own several of the lower titles, thus, I prefer of saving money to to last minute realm restructuring before my king dies (On that note: Your vassals have an Opinion of predecessor modifier, so don't go full tyrant while on deathbed).