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Don't upgrade from Tier 1 housing until you are ready to start that ale production. Get the barley and malt in, then you can upgrade 1 house to a brewery, wait until you have a good supply of ale then you can start upgrading other houses.
In an infertile region its going to be a bit trickier, but you should have some (+) fertility land and even (-) fertility land is decent enough to get some barley flowing.
Keep in mind you need 4 ale per year for every tier 2/3 family, so always balance how much you grow by how much barley you can harvest.
Also have a reserve for if you get hit by a year of drought.