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In The REAL World
The truth is that there is little reason to build your own set since there are so many locations in the world you can film at. For almost any “real world" environment you would need to film on you can likely find a location that will be suitable. Since you have little to no money this is a much better option than hiring people to construct expensive models and sets. There are a lot of things to keep in mind when you are scouting out the best shooting locations.
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Make Sure They Fit
First you have to make sure that the locations you are considering will actually work in your story space. For example, if you are producing a film that takes place on a deserted lake you have to make sure that the lakes you are looking at have the ability to look remote. They do not have to be, but if there are houses lined up all around the water then you may not be able to frame any images so that it looks barren. Make sure that all interiors and exteriors are actually able to represent the critical items in your script, and if they are a little different then what you had planned take an assessment to see if the major elements are still there.
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One thing that people often neglect on their early films is if the locations they are looking at will be able to fit in the visual style and tone of the film. If you need a Victorian style house you may settle on the first one you find, but if that house does not have the type of energy or color palette that matches the rest of the visual motif you are attempting to maintain in your project then you should try and find something else. Often times the emotional content of a location is more important than its practical ones. Keep in mind how you want the locations to be portrayed in the film and then look for places that make you feel that way immediately. It will translate better for the film, and maintain the tone on the set for the cast and crew.
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A great location does not just have the right properties for the screen, but also needs to have a practical amount of space. Take stock of how much equipment and how many members of the cast and crew will be on location. If there is not enough room for free production movement then you may want to consider a different location. This is especially true for interiors, where a house may look great on film but if you cannot move around enough to actually record the scenes in it the visual style will not matter.
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These practical considerations also extend to the ability to record quality sound. If there is a lot of noise in the area that you cannot control, or if the interior is built in a way that echoes sound you may not be able to actually get what you need. Do a few trial runs before choosing the spot and always assume the worst for sound.
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Since you are going to need to use a number of electrical devices it is important that there is a reliable power source nearby. The likelihood is that you cannot run absolutely everything, from cameras to lights, on batteries alone. If it is a very old house the circuits may not be able to handle the amount of strain you will be putting on them. If you are outside you may want to see how far you will have to run extension cords to get electricity on the set.
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Keep in mind that you may have to return to the same location at different junctures, so check ahead to make sure that it is consistently available to you. The best way to actually choose a location is based on how much freedom you have to use it. If you only have brief moments to record then you may want to keep searching for a better location.