I would very much love to have instanced housing, although from my understanding it might not be feasible because of how things are currently programmed?
That being said however, I'd like to take a moment to disregard any technical limitations to add my two gil.
I know this is like comparing apples to low-poly oranges here, but maybe it could work like Runescape? Player houses were in their own (assuming instanced) areas that were accessed via portals, with full plots that could be built upon over time. You had the house as well as the surrounding area (to use for building expansions or gardens), and the way it could work in FFXIV is that the houses would have their respective plot sizes (same amount of room to decorate and everything), and perhaps a bit of extra space to accommodate the entrance and establish the aesthetics of each housing district.
Of course this is almost certainly much easier said than done, so this is just wishful thinking on my part. XD