The great (and most relaxing thing) about Animal Crossing: New Horizons is that you choose what to prioritize in the game. If you'd like to get your island up to three stars and unlock terraforming, you can focus on decoration and bringing more islanders to the game. Or, if you'd rather focus on your house and building it up to be the best mansion it can be, you can do that instead and worry about your star-rating and the rest of your island later.

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Upgrading your house involves taking out a loan every time that you then have to pay off before you can move to the next stage. Go to Resident Services and give Tom Nook what he wants, and he'll offer you another loan. Ah, capitalism.

8 Tent: 5,000 Nook Miles

The loan for a tent is 5,000 Nook Miles. That might sound like a high number at first but as you progress in the game, you'll realize 5,000 Nook Miles is actually not a lot. This is the only time you'll be asked to pay in miles rather than bells, so this is actually pretty generous of Tom Nook because it'll allow you to get a house upgrade quickly.

Although you can absolutely decorate your tent, your house will be more aesthetically pleasing from the outside once it's been upgraded, so it might be best to wait.

7 Small House: 93,000 Bells

Pay off that loan and you'll be given the coveted upgrade to an actual house. Unfortunately, players won't be able to fit very much into this room since it starts out small, but it definitely makes your island look better since there isn't just a tent sitting around but an actual house.

6 Bigger House: 193,000 Bells

Pay off your 98,000 bells and you can take out a loan for almost two hundred grand that'll allow you to have a much bigger space. Many people turn their front room into a joint living room and kitchen by halving it, but be aware that entrances to other rooms will be created, so some of your furniture might end up blocking those if you have a lot. Or, you could be more original and do something wild with your first room.

5 Back Room: 348,000 Bells

The back room tends to be the bedroom for most people. It's around the same size as your initial front room, and has plenty of space for some decoration. You'll never be able to make this any bigger though, so you should make yourself happy with the space you have and if you need a large bedroom, the front room might end up being a much better call.

4 Left Room: 548,000 Bells

Many people dedicate their entire left room to a kitchen. The issue is, it's sometimes best to leave the kitchen for later. Kitchen appliances are easy to find — there's lots in Nook's Cranny, they often drop from gifts — but kitchen countertops, islands, and basically anything to put them on are, for some reason, in seriously short supply. Far too many people end up with a room full of kitchen appliances on the floor because there's nowhere to put them.

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Kitchen islands are coveted like gold in this game.

3 Right Room: 758,000 Bells

Most people's bathrooms end up being the right room. Fortunately, bathrooms are a little easier to construct, though the room itself is a lot of space for a bathroom. If you'd like to make it multi-purpose, you can use a partition (they're available to purchase in Resident Services for Nook Miles!) and then you can have something else in that room too.

Might be a little strange to make a bathroom multi-purpose, but what about this game isn't?

2 Upper Floor: 1,248,000 Bells

If you're willing to take out a loan for over a million bells — ouch — you can have an upper floor. Here, you can do what you like if you've covered most of your bases. Upper rooms are a great idea for workspaces since there are typewriters, sewing machines, and even computers available to purchase in the game eventually. Why not have an office? If you've been rich enough to afford all these house upgrades so far, you can afford an office!

Fortunately, there will be no annoying entrances to this one that require shifting furniture, because the stairs to your upper floor will be right at the entrance of the main room. Neat.

1 Basement: 2,498,000 Bells

For another set of stairs right at the entrance, you can have the final room — a basement. Many people use this as a horror room to freak out their friends, some people make it an arcade — yes, you can buy arcade machines from Nook's Cranny! — and some people even just use it to store turnips.

After you've upgraded your house, you can also customize the roof, mailbox, and other features. You can even move it to another place on the island by talking to Tom Nook if you decide you're unhappy with the location. And, of course, you should totally surround it with a garden worthy of a house that cost you millions of bells.

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