Level unlocks
Workbench (lv3), furnace (lv12) and building (lv1) unlock as you level up.
Tier upgrades (wood → stone → metal)
With the HAMMER in hand, each building piece upgrades wood → stone (masonry) → metal (plates), gaining much more HP and raid resistance, and the look actually changes. The hammer wears when you repair/upgrade. Tools and armor have tiers too (stone, copper, iron, gold). Demolishing returns some materials.