You can place streets and walkways everywhere and connect them. Their path can be set with bezier curves (like in Illustrator). Lots don’t have to be attached to streets but it’s recommended to do so to not confuse the game’s track system. Lots can be freely created with a rectangle, although there’s a maximum size. Whenever you need to make changes ingame, you can do that. There’s a button with which you can switch back and forth between the editor and the game.
You can also define areas where the camera and/or sims can’t go to. Such areas are automatically created when hills or mountains are too steep.