Many people don't believe Santa or his village are real, just because they can't see them. Santa and his village are very real, and the village is surprisingly big. Of course, the village has to not only be a place where the Elves work but they all live there too, so they need homes and things to do when not busy working. As well as that there are all different places where toys are made, wrapped, stored, letters are received, letters are sent out from Santa, places where everyone can eat as well as the stables for the reindeer and the office of the Nice & Naughty Lists and of course the most important place of all Santa's Office, where he writes letters, checks with all his helpers how the children of the world are behaving and invents new toys. In Santa's office he has a big snow globe and depending on how much Christmas spirit there is the snow globe has snow falling in it, if there is lots of Christmas spirit lots and lots of snow seems to be falling inside it, if Christmas spirit is low well very little snow falls in the snow globe.
The houses are mostly slightly smaller than we are all use to as the Elves themselves are a bit smaller than us, but they all have lovely warm, cheery homes which they share with their friends. Sometimes they have Polar Bears who visit them from outside the village as they come to see their friends who help in the village. Mrs Claus has a large kitchen where she makes Santa's favourite cookies and hot chocolate, as well as overseeing the food for each day's meals.
The village has a huge dome roof over it which helps keep it hidden but through the roof everyone in Santa's village can still see the Northern Lights when they come out to play.