I would love instanced housing. I’m still hoping island sanctuaries are a form of instanced housing. Right now people can go visit other peoples apartments and it’s all instanced. It’d be the same thing for instanced housing, but with a yard/outdoor area too.
ESO has lots of different types of housing layouts/yards etc. I think it’s more immersive for people going to an instanced wizard tower than going to a neighborhood with a shirogane castle next to a gingerbread house. I would think role players would love being able to fully immerse in their surroundings instead of being distracted by the person in a chicken suit next door practicing their rotations.