Was this episode supposed to be funny? Because all I saw was behavior that would constitute a visit from the police.
It's another one of those "Squidward abuse" episodes. First of all, why does SpongeBob want Squidward at his house so badly? Is he that desperate for some company? Or maybe he just has some obsessive, twisted crush on Squidward. If that's the angle the writers were trying to get, they succeeded in that aspect.
When Squidward refuses SpongeBob's pleas to visit his house, SpongeBob responds by taking Squidward's vacuum cleaner. When Squidward calls SpongeBob to confront him, SpongeBob responds by inviting Squidward to come over and get it, and then BREATHING HEAVILY into the phone. Warning sign number one.
So, Squidward ends up putting his food in the oven to cook, and then goes to get his vacuum...only to find that SpongeBob has redecorated his house to look EXACTLY LIKE SQUIDWARD'S. Warning sign number two. Squidward once again demands his vacuum, but SpongeBob very bluntly ignores the demands, instead trying everything he can to make sure Squidward stays. Warning sign number three.
Finally, Squidward gets fed up by SpongeBob's unreasonable behavior, and gets his vacuum back himself. However, by the time he escapes SpongeBob's house, he realizes that his house has burnt to the ground because of his food in the oven.
And does SpongeBob apologize for keeping Squidward so long that his house burnt down? No! He just offers to let Squidward stay at his house.
The episode ends with Squidward staying in the replica of his house (SpongeBob's house), while SpongeBob and Gary sleep on the remains of Squidward's house.
There was nothing entertaining about this episode; SpongeBob was acting not only like a jerk, but a stalker. Like I said, if the writers wanted to make SpongeBob out like a guy with an unhealthy obsessive crush on Squidward, well, they hit the nail on the head here.