In CityVille, you'll need to construct houses in order for your city to grow. Building houses will allow more people to move in, and allow you to collect more housing payments. However, your city has a maximum population limit, and as your city's population approaches the max, the citizens will get progressively unhappier.
To raise the maximum potential population, you have to build Community Buildings such as a City Hall or a Post Office. In addition to using up some Energy, these buildings require several of your friends to help by becoming employees. The alternate option is to pay 1 Cash per every position you need filled.
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