If combat and the economy are the two most important areas for a sandbox MMO, player housing is the most neglected. It says a lot about the genre as a whole when the very first MMO, Ultima Online, had and possibly still has the best player housing around. That really is a crime, especially given how important a hook housing can be to players and guilds alike, and just how much content they can drive.
Housing, both individual homes and cities, have to be set in the actual world, not hidden behind some instanced curtain or in a housing-only zone. Secondly, while you don’t need to make every last square inch of the world open for placement, it has to be far more than a few pre-determined plots. The over-development issue that UO faced should be solved not by hard limits, but by soft caps; an area can only have so many houses before it becomes ‘full’, and the closer to full an area gets, the more attention those buildings draw from mobs. The longer the players hold out, the harder the mobs try to overrun the players, eventually resulting in someone moving out or being pushed out. The more popular the area, the higher the risk.
As the only ‘griefing’ that can really occur is from mobs, housing should be destructible; if you can’t protect it, you shouldn’t own it. This prevents the “I got it first, I own it forever” real-estate rush, and gives newer players a chance to eventual own prime locations. The major difference here is that setting when a house is vulnerable (say a 2-3 hour window per day, or a total of 10 hours per week, whatever) won’t upset the mobs trying to destroy it; they will happily show up whether you set your time for primetime or server up/down, while it does allow home owners to actually defend what they own rather then lose it when they are not online, as is all too common in PvP sandboxes.
Housing should be varied, from small and affordable tents and cabins to sprawling mansions and castles, with house size meaning more than just a bigger physical footprint. Larger houses should have the option to hire NPC guards for protection, or to allow for faster crafting production. As this is a PvE game, house storage should be 100% secure from other players, while still being vulnerable to raids from mobs.
Certain houses would also serve as shops, with wares being displayed on the walls or in the windows (again, it’s sad that you could do something like this in UO, and as far as I’m aware, in no other MMO). The level of customization would allow an owner enough freedom to make their shop stand out, and with crafted gear allowing for fluff customization, this would be very important. Shops would be operated by a vendor NPC, creating the illusion of a seller without the requirement of the actual player having to stand around and wait for shoppers. That said, if the shop was active the owner would often see his customers looking around, again leading to natural socialization, as shoppers could make requests or provide feedback on what items they would like to see for sale.
Player cities would be a formal collection of houses, with additional perks such as city walls, guard patrols, public crafting areas, local banking, and a town message board or newspaper (that could automatically generate basic information about recent mob movement, attacks, or possibly new areas of resource wealth). This would all come at a high cost, one that would be collected and paid by a guild or the locals, and the creation of a city would also dramatically increase mob aggression for that area. Cities could still operate within the vulnerability system, but the requirements would be much higher (5-6 hours daily, 30 hours per week, etc), as the expectation would be that all city residents accept defensive responsibility and actually protect their city. A ghost town of a city won’t hold up to mob raids for long, and will either be destroyed or the owners will adapt and actually populate the area regularly.
Cities could also expand or contract based on player interest, rather then being hard-locked into a few set sizes. If a guild discovers a rich resource area, they may build up a city to help aid in gathering, with other non-guilded players joining in as well. Once the resources are tapped, they might move on and leave behind only those who wish to stay and continue operating out of the now less-than-ideal location, reducing the footprint and the mob threat level. As the worlds resources and mobs dynamically shift around based on player activity, no single spot would remain as the ‘best’ location for long, although one would expect certain areas to always be somewhat popular (central locations, near caves/dungeons, etc), leading to some stability.
All players should have the goal of owning property, and smaller houses in more remote areas should be easily obtainable for all but the newest players. As a players personal wealth progresses, he can either afford larger single houses, or become part of a city. At no point is a city ‘too big’ in terms of total houses, although the larger the city, the harder it becomes to defend. Great cities will be popular destinations due to all the shops and utilities (bigger cities could, for instance, have better scouts and hence more informative/accurate local reports, making finding a hunting spot or resources easier), yet also somewhat dangerous with tougher and more numerous mobs roaming the area or making a direct attack.
World events could focus on bringing down cities that have been around for ‘too long’, and the world’s natural story arc could at times focus around heroic groups of players holding on to their property for extraordinary lengths of time (think of it like an endless mode in a tower defense game, but MMO style). As with items themselves, players would understand that houses are not permanent items, and hence their loss would not be game over situation. That said, destruction should not be too frequent, to both provide some stability and also increase player attachment to a location. The final defeat in a city that has stood for months would hurt, but it would also make for a grand event in the world’s history. This would also be the case, although on a much smaller scale, for individual houses, though if even somewhat remote, those houses could be held indefinitely by vigilant players.
The major goal however is to make housing the major driver of content in the world. House density influences mob activity, the acquisition and defense of a house is always a major player goal, and the natural shifting of player house locations creates a more dynamic world.