You should have leveled up already at this point. Purchase a new ability while you're at it. The first fast-travel flag will be enabled and another quest will be unlocked.
You can also sell your collected junks and buy some new equipment. Once you're done, enter Cartman's house. Butters will be unlocked as a buddy and you'll also obtain his House Key. You can also talk to Cartman's mom to add her as a new friend.
Go upstairs and enter Eric's room. Loot his drawers to find some junk you can sell. You can also enter Mrs. Cartman's room to find some interesting junk. You can also obtain one underpants here which is a quest item. Continue to the far left to enter the bathroom. You can find more loot here and you can also use the toilet to produce another shit nugget. Leave the house afterward.
Once outside, you can use the garage key you got earlier to open Cartman's garage to the right. Here, you'll find your first Chinpokomon, Pengin. You can't go past the sidewalk blocked by rats to head to the left for the meantime. Talk to Dougie to add him as a new friend. Since you got Butters' house key, you can also enter their house.
In Butters' house, talk to Mrs. Stotch to add her as new friend. You can also open the drawers to get more items. A bit to the left you'll find Mr. Stotch. Talk to him as well to add him as a new friend. At this point, you should have 7 friends already which will give you one Perk point.
Head upstairs to Butters' room and loot the drawers. You can find the Chaos Lair Key there as well. A Chinpokomon, Monkay is found in the rightmost side of Butter's room. Check Butters' parents' room to the left and you'll find the Stotch Garage Key there as well. You can check out the bathroom again and do the usual. Once done, leave the house and open their garage to get the treasures inside.
Continue west and shoot another chinpokomon (Chu-chu Nezumi) from the tree using your ranged weapon. Now you can go back to your house and talk to your mom to add her as a new friend. Your parents' room should be open by now so enter it and collect the items inside. Once done, leave the house and smash the blockade in the sidewalk to reach the next part of town.
A fast-travel flag is located here. Interact with it to update Timmy's quest (The Timmy Express 2/12) The snowman to the left hides some elves who will ambush you. From hereon, you can pretty much explore the available areas to find new friends, unlock new friend quests and get more items. This main quest is divided to three sub-quests. You can tackle them in any order you want.