I have a bunch of yellow on the west side and some red on the east without realizing I was doing the feng shui until the HHA mentioned it, lol. I don't know if the yellow is doing anything because it just says it increases luck with items and I haven't really noticed a difference. Maybe the red is doing something because I've been scoring more money bell mystery islands but.. I don't know.
I'm not 100% sure if this is feng shui magic or my dumb luck. The HHA really likes it though despite my basement being littered with diys.
As far as I know, there is no luck mechanic in the game even though the official NH guide book says there is. It's likely they will bring it back as an update but in the current version, it doesn't exist.
Fengsui does exist though for the hha score if you just want to hit it for the trophies.