Anyone who played during early-mid EW release around non dead hours is likely familiar with this message (or something like it, I never took a screenshot of the actual message it displays whenever it happened to me) if they tried to enter their home, due to the sheer volume of people afking in houses/apartments away from peering eyes.
https://i.imgur.com/O9vCo28.jpg
and it's why ultimately fully instanced housing isn't going to happen. It's pretty clear on the backend, housing can only support a finite number of open instances before it prevents anyone else from opening an instance. Instanced housing is irrelevant in FF14 if the instance cap gets hit when only a fraction of the total playerbase even has a house, could you imagine how ridiculously hard it'd be to enter your house if the entire playerbase had a house with only enough instances to handle like, <2% of them? I actually wouldn't be surprised if this error message begins popping up more often come Ishgard, unless they can do small scale modularity for the number of instances that can be open.