Your house is an important feature in the Animal Crossing series and unlike in the previous AC games, you will be able to place your house wherever you want. Each of the characters you create in your town has their own house. You will start out with a tent. After you pay the down payment, Tom Nook will build your starter house. Your house will start out small, but can be expanded as you progress through the game. You can have rooms to the left, right and back of your main room, as well as an upstairs and basement.

In Animal Crossing: New Leaf you can personalise almost anything on the house exterior, such as the fencing, doors and even the letter box; all these things can be purchased at Tom Nook's new store called 'Nook Homes' in the mall area. For the first time in an Animal Crossing game you can place decorative items on the interior walls of your house. You will be able to add your designs to furniture by using the recycle shop. When you enter your house, a virtual light switch will be on the bottom touch screen to turn the lights on and off and you will be able to turn the camera angle by 360 degrees (all the way around), as well as a zoomed in view and a top-down perspective. You will also be able to store bugs and fish in storage items in your house, a new feature for New Leaf. You can also choose which part of the house you want to upgrade (basement, second floor, etc.) instead of having them upgraded in a fixed order. Once you have all the rooms (they can still be the smallest size), you can change the exterior style of your home. Completing payment of the starter house mortgage (39,800 Bells) will trigger access to the island and the Happy Home Academy (previously known as the Happy Room Academy). As an HHA member, you can do a 'theme' challenge after earning 150,000 points. This challenge requires you to pick one theme and complete it (exterior and interior). The styles you can choose from are: Modern Home (looks like an apartment building), Western Castle, Japanese Castle or the original mansion style house. If you ask Lyle what your HHA rating is, he will tell you what it is as of that morning.

As you first enter your tent, Isabelle stops by to give you a lantern (furniture item) and tells you in a tutorial-like manner about moving furniture and activating interactive furniture.
When Tom Nook asks what roof color you want for your starter house, he offers four colors in the order of red, blue, yellow, and green.
When you first enter your starter house, Isabelle stops by to give you the paw-print wallpaper and to enable your indoor light switch.
The item limit for each room seems to be 48 items, including items that can be hung on the wall. This maximum applies no matter what size the room is, though a 4x4 room can hold only 32 items, at maximum, due to the limit of available space.

You must speak to Tom Nook to make your first down payment. After you finish paying off any mortgage, you must speak to him again to initiate any additional building/expansions to your home. Unlike in the prequels, Nook will not immediately push for an expansion. Instead, you must speak to him yourself to initiate it.
After your first down payment, you can make payments on your loans at the ABD in the post office.

NOTE: If you wish to expand your house the current day so it will be completed the following day, you must make sure to pay off your loan and talk to Nook before Nook Homes closes (10AM - 8PM w/o ordinances). If you do not you will have to wait another day for your expansion to come into effect.

Upgrading your youse:
The upgrade
Room size
Picture (outside)
Picture (inside)
Starter house
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First expansion
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Second expansion
Upstairs room

Diagram of house upgrade

After completing the 298,000-bell mortgage, Tom Nook offers you the choice of the following:
Here are the mortgages for further expansions:

348,000 bells for a room on the left (4x4)
348,000 bells for a room on the right (4x4)
348,000 bells for a room in the back (4x4)
428,000 bells for a basement (4x4)

498,000 bells for widening the upstairs room (to 6x6)
498,000 bells to widen the left room (to 6x6)
498,000 bells to widen the right room (to 6x6)
498,000 bells to widen the back room (to 6x6)
498,000 bells to widen the basement (to 6x6)

598,000 bells to widen the upstairs room (to 8x8)
598,000 bells to widen the left room (to 8x8)
598,000 bells to widen the right room (to 8x8)
598,000 bells to widen the back room (to 8x8)
598,000 bells to widen the basement (to 8x8)

So, that's 19 loans totalling 7,595,800 bells for a finished mansion.

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Inside the Nook housing store where Tom Nook is selling doors, letterboxes, fences and other parts of the house.The outside of your house does not affect you HHA score, but it will show up in other peoples model homes.

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