I can't wrap my head around it. Right clicking this bed doesn't give the "Spawn point set" message.

Spawn location

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    @Raven You could be right, but I didn't find any quotes in both Terraria wikis. – Drake Jun 14 '11 at 6:34
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    No, I have a home deeper than this with a set spawnpoint – Hubro Jun 14 '11 at 10:20

As far as I know, you need to have a door for a house to register as a house, and no "open" spaces or gaps in the outer walls. If you look to the left of the building you're in, you have a small gap on the floor where you have the bed. Try to cover it and, theoretically, it should work.

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    Good catch, I didn't see the hole in the wall at a first sight. Probably will solve. – Drake Jun 14 '11 at 7:03
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    Much obliged. Didn't notice that hole – Hubro Jun 14 '11 at 10:43

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