This is a long one so, here's a tl;dr -- Played for about 37 hours. Love it, cozy and fun. Etiquette is a thing but it mostly has to do with sharing resources and helping others out (I'm introverted and it doesn't bug me, in fact it's rather sweet and I like being helpful), NPCs are fun (you can romance them too ;D but nowhere on the same level as BG3 or equivalent), and the setting is lovely. Complete quests for free stuff like a glider or a rideable mount. You can pay out of pocket for cosmetics, extra storage (I guess, haven't needed it so far), and cool-looking mounts, but you don't need to. Definitely worth trying out and, if you like it, I recommend checking out the wiki and a couple of YouTube videos so you can learn tips and tricks to make gameplay more fun and easier to understand.
Issues: Server-related stuff. Too busy? Lags. Too few people? You get sent to another server. Some people have described it as jarring, others have said you get time to finish up what you're doing before it happens. I haven't experienced that yet, so we'll see what happens in the future.
I address some of the issues repeated in other comments. More details if you need them down below.
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I love to play different types of games, but mostly stick with games like The Sims 4 and Baldur's Gate 3. i don't remember why I chose this game in particular... although it was probably because I wanted a life sim experience with a fantasy twist, and I think I fell in love with the look and basic premise of the game. Plus it's free to play, so I lose nothing for simply trying it out. Either way, I'm happy to have given it a shot. I've only spent about 37 hours into the game, so keep this in mind. However, I've managed to get a lot done in that short time! And I've read comments about pricing and etiquette and such. Those haven't really hindered my gameplay and I'll explain why in a moment.
First I want to say that off the bat it's a gorgeous, cozy, community-based game. As an introvert, I wasn't really into this aspect because I like to do things solo. However, as the NPCs in town explain, etiquette and manners are the backbone of communicating with people. It doesn't have to do with being polite (believe me, there are a couple of NPCs who are anything but), but it has to do with sharing resources and working together to make everyone's experience better. When you show acts of kindness through fulfilling quests and other activities, you get gifted with everything from fun cosmetic stuff for your home (Gah, I have so much wallpaper) to important resources that can help with things like farming and mining.
As for how you interact with other players, yes there's etiquette for that too. But for good reason. There is a wealth of knowledge out there about how etiquette works (check out the Palia wiki or search on YouTube). But at the heart of it is what I've mentioned before: sharing resources and making the experience better for everyone. Much of the etiquette includes letting people know when a rare resource has popped up, asking for help, etc. One time someone started mining the same bit of stone I was working on. At first I thought "Well, rude." Then I realized if we work together, we both get the resource. I also like that you can request specific items that players can share and you have the ability to fulfill those requests as well. It's a great way of getting rid of stuff in your inventory (which can also help you avoid having to pay for extra storage in the long run) and it's a great way to work with the community. And the community can be pretty cool. One time someone in the chat mentioned that their boyfriend, another avid player, passed away and asked if we could shoot fireworks in their honor. It was really touching to see the sky filled with those fireworks, and to see the beautiful messages flood into the chat. So there are those moments too. I have yet to experience rude people in the game, and it's typically people like me who misstep on manners simply because I didn't know any better. Even then, no one has reacted negatively, at least from what I can tell. Once I learned (and am still learning) about how things worked, it actually makes the experience quite lovely.
Okay now onto cost. I did spend my own money on the game. It's free to play, and the things I purchased are things I wanted, not things I needed to play the game. If you complete quests, you can get the fun perks like a glider and a rideable mount for free. The pack I paid for gave me access to a special mount and enough Palia coins to go wild. I will say that it can be costly. That said, I want to look cute in the game so they can have my money lol. Again, it is a free game to play, you don't need to buy these things to get through it, but you'll certainly want to buy them lol and that's when you have to figure out if it's really worth it to wear a Haute Dog suit or purchase the license to ride a cool-looking mount (these are MY current struggles lol, your mileage may vary).
Paying for storage with my own money hasn't happened yet and I don't see it being an issue right now. You can earn money in the game through farming, fulfilling requests, etc. And that allows you to use money earned to purchase more storage. But I don't see myself paying out of pocket for storage anytime soon. Many items can be sold, gifted, used for decor, etc. so running out of storage isn't a problem unless you like to hoard, maybe lol. That can be an issue because you never know what you might need, but then it's more about convenience. You can always ask others if they have a particular resource you need and see if they can share.
There are limitations on how much decor you can have, but if you do some research you'll find workarounds to this, such as buying plots elsewhere and decorating those homes. However, I haven't made it far enough for me to worry about it, so maybe I'm missing something. I've only seen other longtime players use this strategy.
I don't have any hardcore complaints right now that ruin the game or seem like a big concern. Sure, it can be expensive to purchase things for fun or flair. But I've seen discounts on things like outfit bundles and you have the option to purchase what you want. Lag does occur when the server is busy and that can suck. If the server is slow, then they'll try to move you to a different server. This hasn't happened to me yet, but I hear it can be inconvenient. So that's something to consider.
Overall give the game a shot. There are many ways to play the game. Don't be afraid to invest in things you like, but don't feel obliged to do so either.
