I wrote a long reply but forgot to post it, so this will be short. The third hut's beginnings are supposed to appear after you hit 25 people.
Also, I always rotate my villagers so that they can all do foraging, harvesting and fishing. When I have enough points to buy the crops, I don't show it to the villagers since they will spend all their time uselessly watering while the food bin goes down dangerously. The crops will appear without the water. I also never breed a huge amount of people until I have the fishing to sustain them.
Yes, I do know that the magic garden does indeed have to be watered...that I have never stopped. Alas, it rarely appears.
Gail