Would it be better to have 1 model of a complete house uv mapped or do you think it would be better to have three models (roof, walls, interior) of a house and then place them accordingly? It seems like an obvious question but it has really been bugging me or the past few days.
It also depends on the size and detail of these houses. You’re going to need to use tiling textures if you want any sort of detail in there, which I assume you will as you mention interiors. Using a single texture atlas for an entire house would give you a very low texel density for something like a first-person game.
You’re going to want either a 512x512 or (ideally) 1024x1024 texture for every 4x4m section of wall, for example, and the simplest way to achieve that is with tiling textures, which means multiple materials/objects per house. The secondary advantage of this (other than higher quality textures) is that it encourages re-use of materials and modular meshes. If you don’t need lightmapping, you can use the second UV channel for another “detail” texture that is mapped to a larger scale.