In TESII Daggerfall, you bought a house through the banks. In Vvardenfell, Balmora, would you buy houses through Hlaalu if buying houses was implemented in-game? I know you can have your own http://www.uesp.net/wiki/Morrowind:Stronghold_%28Hlaalu%29 in the last quest for House Hlaalu. But how did all the other denizens of Balmora acquire their homes? I know there are mods that add banks to Balmora but is that lore-friendly/correct? If Greg Keyes were to write a book based in Balmora in the 3rd era and two of his characters were a married couple wanting to buy a home, what do you think he would have them do? This is for lore purposes and has nothing to do with the game mechanics or time deadlines or budget (which I'm guessing are some of the biggest contributors to Bethesda not including many things in their games). Thanks!

How land is distributed within Hlaalu territories is probably not identical to how you imagine it ("buying a house" is an idea that is very specific to human modernity), but obtaining land in Balmora is almost certainly a question of dealing with House Hlaalu. Maybe, in a formal sense, the Temple controls the distribution of land, but because power in the late 3rd Era lay in the houses, House Hlaalu is clearly what really matters.

Dangit, now I'm reminded that we used to be able to build strongholds.

But yea, they have deeds and all those normal things associated with buying houses and land. There's a fair number of quests dealing with deeds and whatnot. Chances are you can buy deeds from individuals directly (or from the House greater if they hold the deed).

I like your points. Although I was under the impression that the Empire owned all land everywhere, and that the provinces were just paying taxes to utilize it. The games don't focus too much attention on taxation and real estate, but I would imagine if Balmora were real, the elves who lived in their homes would pay taxes to the Houses and the Houses would be paying taxes to... I guess Dren, the governor of Vvardenfell, who would direct those proceedings to King Helseth and Barenziah, who would in turn, give up a big chunk directly to the Empire. I got off track there.

Why do you think people cannot own houses but own land? To me, that sounds backwards, although I'm comparing it to Roman and medieval land ownership and housing. Back in those days, the government owned all the land and the person would, I'm guessing rent, the house they lived in and pay the rent each month, plus property taxes and other taxes, including a pole tax (tax for simply being alive). But you're saying denizens of Balmora, or any House district, may buy a plot of land from the corresponding House but if they want to build a house, they have to let the Great Houses do that and they are the ones that own it?
I disagree because if an individual could own a plot of land in, let's say, right in the middle of Hlaalu territory, what would be stopping him from establishing that territory as Redoran or Telvanni or Imperial territory? Or for that matter, if someone had enough gold, they could buy all Hlaalu territory and make it something completely different. I'm sure there are some laws in the Empire or Morrowind that prevent something like that from happening. Are there?

But I would think that a person would have to get a deed and permission from the House to "rent" or "lease" a plot of land to live on, and depending on how much money they paid and what permissions they were given by the house, that would determine what type of property they could build and how high and all that and what its purpose was for, whether a shop or a home. I know they have free trade (as is said by one of the Pelagiad citizens in-game) but that doesn't mean that the Houses wouldn't or couldn't have strict regulations on real estate. Like for a noble three story house, they would be paying more money each month for rent and taxes for having a bigger and more extravagent home. But they're rich, so they can afford it. And the poor people could only afford to pay property taxes and rent for a tiny plot of land and have only enough money to hire carpenters or plasterers/drywallers to build a tiny one room one story home (like what several of the homes in Balmora are designed like; though I don't quite know what material they are. Looks like hardened clay or something).
Any ways, what do you think of my ideas?

My curiosity over this was piqued because I'm working on my showcase interior mod for Tamriel-Rebuilt and there are documents laying around the house and I'm wanting them to represent taxes owed, house deed, a list of new regulations imposed by House Hlaalu.

If I remember correctly all of Vvardenfell belongs to the Temple, they just let the Great Houses claim certain areas.

if im not mistaken, the deeds you aquire in morrowind, for hlaalu, redoran or telvanni, stipulate what piece of land, how big, location, discription, whst you are entitled to build and or have, from retainers to guards allowed..only reason i remember is i loved the detail they put into that.It is correct that the temple at the time was the highest law of the land so to speak, but then you still could only construct/hire etc.. once permission was granted by Dren right?

I think on Vvardenfell it would work like this

Temple owns the land (Almvisi)
Duke of Vvardenfell (Dren) has the right to give away pieces of land
You pay the Duke and thus the temple for this
You build your city
People come in, want to buy or rent land in city, and then you make money from that.
You can probably charge taxes to all that live there...
Census office sends agent by to collect Imperial Taxes.

So in Balmora's case that would be something like this:

Temple sold land to House Hlaalu. They completed the city (before that there was supposed to be a palace for Vivec there, although I have no idea where it went in the game itself)
House Hlaalu then rents out or sells a piece of land to whoever wants it.
House Hlaalu collects taxes (part of this goes to the temple)
Then somebody from the Empire comes by and collects Imperial taxes

I would think it's very likely that the Almvisi would send some of the money they make like this to the empire as taxes.

The problem of who formally owns the land aside, I think one of the issues An Insect Dreaming was alluding to was that the owner of land might not be able to dispose of it at will. Especially in situations where the ownership is not absolute and there are overlapping claims (e.g. mediaeval Europe, Vvardenfell), you would need to get permission from the powers-that-be to make the transaction. In Vvardenfell, it seems as if one has to go through the Great Houses to get such permission- but you'd also need to find an unoccupied house or someone who is willing and able to sell. I imagine some sort of 'consideration' (i.e. bribe or tax) would have to be given to a Hlaalu official in the council house.

From a Morrowind standpoint, it wasn't that long ago that Vvardenfell was opened up for colonization. Prior to that, aside from the eastern archipelago and some Pilgrim's waypoints, the only settlements were Temple-controlled Molag Mar, Ghostgate, and Vivec. I'd imagine housing there for non temple members was 'rented' through the Temple treasury office. I'd imagine you could pay one large sum to buy the house, but the land it resided on still belonged to the Temple.

Post-colonization, the island was split up into certain tracts of land owned by certain powers. Hlaalu, Redoran, Telvanni, the Empire, and the Temple now owned their respective parts of Vvardenfell (with the Temple or the Empire (can't remember which you got your deed from) owning the unclaimed sections until they have been settled. I'd imagine for a Great House, they wouldn't support giving you a land grant unless you were a respected member of their House (like the strongholds depicted ingame), but you could 'rent' a house similar to the way the temple offered housing on their land. For taxation purposes, the administrator of the settlement would levy a tax against it's people to cover taxes levied against him by the empire and the house. Part of it would go to the Temple out of respect for the Three, part of it would go to the House for tribute/dues paying, and part of it would go to the Empire.

Now if you were on Temple-land, I'd imagine you'd be tithed a certain amount, then there are House dues if any, but no Imperial Tax as the Temple pays your tax for you (out of the Tithe).

Finally, if you lived on Imperial land, you'd go through the Duke like you do in Oblivion and Skyrim and you'd own the land directly under your house (if you could) and the Empire would tax you directly. Depending on how the Census and Excise system works, the Duke might individually tax you again on top of the Imperial tax. So here's a hierarchy of colonization:

The Empire owns the land.
Through a feudal system, the King Helseth is in charge of the land and Duke Vedam Dren administers it. Unless you're on Temple Land, in which case, the system goes through Helseth to the Temple.
The Houses obtain land-grants from the Duke to own certain bits of land on the stipulation that they can put warm bodies on it.
The Houses appoint well-respected members to oversee those land-grants. These are stronghold owners. You can compare them to a Count I suppose, though maybe a Knight is better.
Commoners are below this and rent the land from the Houses. Taxes move upwards this chart in terms of responsibilities (commoners pay the Houses and maybe the Duke, the Houses pay the Duke, the Duke pays the King, the King pays the Emperor)

If you are on Temple Land, they already own the Land and pay tribute to the Empire through the King. It's questionable what the Temple does with their common tier.

If you are on Imperial Land, then you merely obtain dispensation from the Duke and pay Census and Excise through him.

-And That's my spin on the system. It's a little strict on the Feudal system, but that's more because that's how the Empire seems to structure itself.

Are you buying a house that's already there, or are you buying a long-vacant lot? I'm sure Hllalu would be willing to let a Balmoran trade their home so as to make a few coins. They may be entitled to a cut of the transaction, or they could make the seller pay a real-estate agent / lawyer type, and Hllalu controls the caravans, the food suppliers, and the mercenary guards the seller would have to employ in order to make the move. Once the new guy moves in, he'll want to purchase new furnishings, get new locks, et cetera. It's just good for business.

If you're buying an empty lot, Hllalu might have to jump through some hoops to get the new construction approved. I imagine this would be identical to the process used in the stronghold quests.