I know some people are against instanced housing because they love the neighborhood feel of our current housing system. But who says we can't have both?

Personally I think instanced housing would be great. This past year we've been seeing that SE had been leaning towards a more cross-server experience. First we had the cross server party finder, now we have a cross-server friend list. I think it's only a matter of time until we'll have cross-server Linkshells and maybe even cross-server MB. I think instanced housing would make something else possible: cross-server Free Companies.