Each house can settle dwarf, or a family of gnomes.
My gnomes are young. they still have not grown a beard.
but it will happen. then
here is my free Tutorial make gnome from wooden peg and felt
you will need
wooden peg dolls
2 wooden beads for each gnome
Drill the through hole for the hands at shoulder level
Pass the wire through the hole
strung beads on the ends and bend the ends of the wire twist so that she could not scratch.
cut out of felt or other fabric dress and hood.
Sew small stitches on the edges.
put on your doll.
if you want the cap is not removed. then glue it on the glue.