If I recall correctly, a big part of the problem is that the game isn't optimised super well at the moment. From what I've read in the past, being near too many Instances can bog down your computer as is also having too many tamed animals( I think, I read that the chickens can be bad for this sometimes).

You can track instances by pressing F2, which can also show you other things like FPS as well. depending on your computer, you may want to consider how many active instances in your current zone. Some have cited that 9000 instances is a recommendable limit, though my own potato of a computer starts to grumble considerably at around 5500 or so.