That sounds more like a hotel :O
I think the idea of kingdom leaders would have to give you the building flag could work, but they would have a limited amout of flags
Something like 5 or 10. Hmm.. as for improving homes, what about you make a trapdoor in the workshop and then place it somewhere inside your house, then it would say 0% or something and you would have to open it and start digging until it went to like, 50% then you would have to bring rocks, planks and nails to the trapdoor and you would have made the basement?