Depends on the neighbohood; Rowhomes/duplexes, or single homes that are very close together, you have got to have a fence. Separate homes with larger yards, though, you can get away without fences.
We looked at a duplex that had no fence and a shared patio. We met the neighbor, an older Italian guy who was really nice and very chatty, and I mentioned to my fiancee that he might become tiresome. I imagine you can't even grill out on the patio without him stepping outside to say hello, but sometimes you don't want to hang out with your neighbors.
Boundaries are important to healthy friendships.