My rule of thumb is whether you can draw a standard boundary with 10 chimneys. That's going to be at minimum a manor house with some heated outbuildings, a large farm and some homes close by, or a cluster of smaller houses. I'd qualify any of those as "town". The natural plants and trees removed or groomed and cultivated by humans, most edible vegetation is deliberately sown for human consumption, and a decent amount of the space either scraped down into dirt paths or paved if you're feeling fancy.
Doesn't work in warmer climes, but it's a good start.
So far I am reading that a town needs a defined marketplace, and an established dedicated place of worship.
What about a Boundary, like walls? So that one side is "Town", the other is not "Town".
Or if no walls, is it building density? You stand at one residence/place of business and if you throw a stone in any direction away from your current location you hit somebody else's residence/place of business. Anywhere you can do that is inside the Town.
If up to, say for the sake of argument, 25% of throws don't hit another person's residence/place of business you have reached the edge of "Town". If there is less chance of hitting somebody else's residence/place of business, you are outside of "Town".
I still like going with the definition of needing a charter, whether from a recent ruler or an ancient foundation. As most of my games have been in the Stonehenge tribunal, where Richard sold charters like crazy to raise funds for his crusade, and King John sold a lot in his last couple of years to keep the treasury funded while his barons were rebelling. German bishops create plenty of charters too.
Does this make everywhere outside the kingdoms of England and France, the Holy Roman Empire and parts of Europe where ancient Greeks and Romans founded lots of settlements seem uninteresting by comparison?
If Ways of the Town were a supernatural virtue, I think this would have a lot going for it. Word is power, and the charter is words, and logically it bestows a mystic sympathy on the town.
Being as it is, a general virtue, I am more inclined to look for mundane criteria, and I cannot see any clear impact from the charter on the general and mundane ways of the town.
But this is of course a design choice, and not determined by ontological facts.
I am not convinced there is a massive difference between countries in 1220. Central governments quickly took control to regulate the creation of towns and market. It becomes very different for sagas set in earlier eras.
If the difference between "town" and "not town" is the charter, that means that the charter has some discernible supernatural character (anyone with "Ways of the Town can immediately tell), and with appropriate research, could be affected by hermetic magic. (Or worse, faeries.) Nobody requires a formal declaration for a forest, or a mountain.
I knew that the charter itself had value - there is another hook about King Richard selling the charter to London in order to fund one of the Crusades, and the charter was missing. So the party needs to find it before faeries/infernalists/Amway salesmen took possession of it. But losing or even destroying the charter wouldn't cause London to lose it's town status. There would likely be some significant negative effects, mystical and/or political, but not disincorporation.
Is that obvious? I see an exciting plot hook just there.
I agree that most stories will not make such a point out of the charter, and not even harvest the vis, but if you want to make a point of the mystic nature of the charter, why not go all the way?
In short, if townhood is a mystic property bestowed by the power of words, make it mystic and as fragile like other similar kinds of magic. If it is purely mundane, defined by the ambience of the regular market (e,g.), the charter should not matter.
If it's too big, it is obviously a town, everyone can see it 