Bug/Issue Joining multiplayer

My friend had a solo game, built two houses and tried to host a server however whenever me or a mate try to join him it says "No free slots on server"

Notes:
-He did sleep, saving the houses
-the houses are functional in his game
-All versions are up to date
-We all restarted out games multiple times
-He even tried building a fourth house and nothing changed

Any help is appreciated

 

I've had a similar issue, where two people could join but one person was stuck with a "No free slots on server" message.
The reason was a corrupted farmhand in the savegame (which was a result of a player crashing while they were creating a character). Once a slot is filled it seems to stay that way, at least as far as I can tell. They also seem to be linked to player IDs.
The only way I know how to "fix" this is by deleting the broken farmhand in the savegame.
You can try to look for the cabin building in locations/Farm/buildings. There should be an indoors tag which may or may not have a farmhand tag inside it.
I found that simply deleting the farmhand element and restarting the game works (the game will automatically fill in the absent tags again) but the character will obviously be lost, although in case of a glitched out farmhand that doesn't matter too much.
If you decide to try this proceed with the same precautions as advised for playing the beta in general, backing up savefiles etc.

Building a fourth house would probably not work since I believe the MP is limited to three clients (although I haven't tested more than 3 myself, put that on my todo list). In this case I don't know how the game chooses which cabin to use, it may be random or some cabins will just never be used.