The wiki article here:
http://doc.pfsense.org/index.php/Creating_Your_Own_Package_Repository
Was written before when the repo was on rcs.pfsense.org. Over the years people have checked in all kinds of binaries into the repo, and they don't belong there. Only the PHP/xml/scripts belong in there. So when we moved to github a lot of that data that shouldn't have been in the repo was purged (lots of .tgz/.tbz files add up quickly in size!) and moved to where it should be on files.pfsense.org.
As a consequence of that purge, the size has reduced quite a lot. It used to be nearly 1GB in size between the data and the history in the .git directory. It's still nearly 200MB.
pfSense-packages$ du -k -d 1
88258 ./.git
110476 ./config
198970 .
When developing packages, especially making new ones, having your own repo is quite handy. It's even better if you make your own fork of the packages repo on github and work with that on your server as you make changes. Then once you have it ready you can just submit a merge request there.