Your background walls must be something that you have placed yourself. The house must be at least 6x8(not including the walls, floor and ceiling) Items do not break in this game, so you don't really need to make more than one item. Avoid purple grass areas(corruption) until you have some armor. (Copper or Iron) Make multiple houses so NPCs can move in. Try making a furnace and an anvil, then you can start crafting yoru armor/chests/better weapons.