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It´s because of the needed space to spawn your character / pals.
Housing in general needs a bunch of fixes, but i highly doubt that this is high on the priority list.
There is stuff you can´t build correctly or which bugs out if you´ve a roof etc... You can´t even build a simple bridge, even if it would be physically correctly, and so on.
Because this game is early access and there is far more stuff than just going for detailed housing.
Try and put that pal box on the second floor.
if the foundations are hugging the ground it will work, but if its elevated over the terrain it gives the warning the Pal Box can not be placed because it is not touching the ground.
I was soooo annoyed with this until I realized you CAN put the Palbox on foundations its just you have to have the large amount of space it requires to do so.
So, instead of one foundation (which it looks like it can fit on), place a 3x3 box of foundations and it will place in that space. Not sure if it has to be 3x3 but I know 3x3 works :)
A 2x2 square works fine for a palbox too. :) I usually start with those 4 foundations, palbox on, then rest of the base from there.