It turned out that I had the wrong syntax. Mercurial uses the scp / ssh style to refer to files and expects a double slash when the file path is absolute, as it was in my case.
An alternative is to either use a symbolic link in your home, or add two forward slashes for the root fs.
instead:
hg clone ssh://user@host/repo_dir
using:
hg clone ssh://user@host//repo_dir
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