The Fairy House has two major uses;
Talk to Alexander Edit
Alexander studies the Red Fairies. Talking to him can reveal some interesting facts about them.
Trade Fairies Edit
This is the primary purpose for visiting Alexander. For every 10 Fairies traded, Alexander will give the player a new card. There are 100 Fairies in Lost Kingdoms and thus 10 rare cards. Some of these cards, like MegaMandragora, are otherwise hard to come by.
If the player has no fairies on hand, Alexander will simply state the total count so far.