User blog comment:GODZZwarmachine1997/Terraria 1.3 "This is not valid housing." PLEASE HELP!!!!!!!/@comment-5686539-20150921100050

Is that natural dirt wall on the right side of the room? If so, then we have your problem. Background walls need to be placed by the player in order to count as a valid wall.

That's the only thing I see off about the house.