Colony Deeds are solely used for attracting tenants to player-made structures.
The type of NPC that moves in depends on the furnishing the player has given to the 'house', as well as what blocks are made out of it. Decorating a room with several objects in a unifying theme (such as biome, or material tier) will give you a tenant themed to match. If you can keep your tenants happy, they will periodically award you with various items.
Colony Deeds are purchaseable from Frögg Furnishings.