Is player instanced housing more of a strain on the server?

[Almagnus1]

With instanced housing its more of a strain on the servers for SE. Potentially everyone and their mom can have a house which would have a yard with things and an inventory plus a house with several floors and an inventory.

The only benefit is for people at home with a potato pc who dont want neighbors because it blow up their pc having to load all the items in the ward.

That assumes that all the houses stay in memory. If the house isn't being used (and SE programmed things correctly), it's going to unload from memory and only exist as static data stored in the database and loaded into memory again once you need it.