The way housing should be

[Dark-Saviour]

It is for lower gil revenue players. A Personal Apartment is a apartment after all which is more for indoor things and not known for out door stuff. However, a balcony can also be added for the Apartment building for out door stuff but since it is a apartment build the balcony will not be big as the Housing yards.

A Private Island can also be added in the game but the price will need to balance out considering that it is a Private Island for the player that owns the island only.

Why do we even need to apply real-world style cost differences here?
It could very easily be that one of the numerous NPCs I save gives me a piece of land out of gratitude (or whatever) if you need a lore-based way to justify it in-game.

Things shouldn't be designed around the current costs; the system as it currently exists never should have existed, and shouldn't be taken into account when implementing or pricing things as they should be, IMO.