Matamata in New Zealand was the place chosen to film the Hobbiton scenes of the Lord of the Rings Trilogy of movies. After the film was finished the farm upon which the Hobbit village was created asked if some of the hobbit homes could remain to serve as an additional tourist attraction to the area.
...And so it was. However, it does look as if the sheep have discovered a new home and evicted the previous hobbit owners. A shame in some ways. However, the structures were never built and then fully furnished - all the scene's inside of Bilbo's house were shot in a studio far away.
In other words, don't go to Matamata's Hobbiton expecting Disneyland. Yet while you may be enticed to this rural community by the ghosts of Peter Jackson's movies, there is more to the place than Hobbiton, even though it is still a quaint remnant of a supreme series of movies.
The set still has a charm all of its own. OK, you may need to squint a little to imagine a populated village, with smoke rising from the chimneys. Yet the New Zealand countryside here is at its most stunning and the farm on which Hobbiton sits offers tourists a tour, showing you how sheep are shorn (for breaking squatting laws, perhaps) and the opportunity to pet the lambs.