House
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A house is a building/structure built of wood (or stone) on flat ground.
A house preserves your possessions by reducing decay, and protects them from theft (to a degree): if equipped with a door lock no one may enter your house except the friends you give permission to--unless they break in. If the owner of a house has not logged in for 1.5 months, the house is marked as 'abandoned', and takes much higher decay.
For more information, see The "how do I build a house?" guide.