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The other reason is that you might have an invasion in progress.
Also possible you dont got enough houses available, doesnt hurt to make extra just in case. It seems houses can possibily be too big as well but that's hard to achieve unless they're screen-sized.
Else check if your background walls dont got any holes in them, and you cant place blocks and a door infront of a naturally (non-player created) background walls and expect it to work, you need to place a background wall yourself before its valid housing.
Hm, all things considered this game is quite picky on what is valid housing... :P
(It even can count a house as too small, if it is already quite small and you open the door inwards into the house/room!)