I have been playing rift for some time now and believe that housing would be a great addition to the game. At first I thought it was just rumors but I've come across this thread and feel like if everyone is talking about it, why not add it?
According to the devs, they're not fond of the idea because they don't want everyone holed up in their houses. They want people in groups or out in the world where other players can see them. It has more to do with the environment player housing creates than anything else. The devs haven't said no to player housing, but they have said that it's only something they would do if enough players show interest in it, and even then it would probably never be high on the priority list.
Y'know, I've read that argument before from the WoW devs when they were asked about player/guild housing.
And the only thing I can think of is: It never seemed to hurt FFXI.
Seriously, FFXI gave every player an instanced house that was not only private, but essential to some aspects of the game; their streets were always full of people, the world always looked alive even though player housing existed.
Actually it probably cut down on a lot of the lag issues that game had which I could see being a zillion times worse with no player housing