Housing?

[Yancarl]

I'm a little confused as to how housing works.

Are there places within the world reserved for where people could set up their homes? Do players pass by those places on their way from point A to point B? What's to prevent suburbia from taking up maps?

[NANA]

There the houses are in instances i think, imagine how messed up the world would look if it was full to the brim with houses plus the lag aswell.