I encountered the same error running on SuSE 7.1 (kernel 2.4). This bboard pointed me to the real problem: Postgresql 7.1.1 is not working properly. Redid my installation with version 7.1.2. Everything worked fine.
Before you actually load the datamodel I suggest you make an addition to homepage.sql. All the way at the end of the file, add:
--drop function hp_get_nh_member_count(integer);
create function hp_get_nh_member_count(integer) returns integer as '
declare
neighborhoodid alias for $1;
counter integer;
BEGIN
select into counter count(*) from users_homepages
where neighborhood_id = neighborhoodid;
return counter;
END;
' language 'plpgsql';
And execute this create statement in psql. Otherwise the neighborhood functionality will not work.