Might I suggest a third option between 'enable demolition to bring out a tiny trickle of houses opening' and 'add in a static number of houses to a rapidly increasing playerbase that is far outstripping any single increase in supply?
Give Ishgard an instanced plot, and you can have that house OR a ward house, but not both at the same time. Bam, want a house get a house, plots in wards will free up as many want Ishgard housing, there will always be at least one plot to anyone who wants a house, gets the furniture market moving, gives people a reason to make use of the insanely easy crafter leveling, nobody loses out on anything. A single plot to the WoL could even make sense 'Thank you for your help with everything' sort of thing.