Houyhnhnms value reason and logic above all else in their society. Theirs is the one land where Gulliver actually wishes he could stay.
Houyhnhnm Land seems almost perfect. Because of their emphasis on reason and logic, the houyhnhnms have eradicated many of the problems and issues that humanity still faces. For example, the houyhnhnms do not have to worry about laws or criminal acts, because of their applied use of reason to every facet of their daily life. Breaking the law would not be reasonable or logical, so houyhnhnms do not. They simply agree on the best course of action, without having to worry about differences of opinions. Houyhnhnms do not have opinions; in their mind there is only really one right course of action, the correct one.
The houyhnhnm application of reason even trickles into their social and family lives. The houyhnhnms do not marry for love, or any emotional consideration (they are not an emotional people), but rather for the purpose of optimizing their own breeding potential. Mates are chosen for the best possible attributes to improve the future bloodlines of the family.
Although Gulliver was absolutely entranced by the Houyhnhnms' love of logic and reason, their society also seems a bit sterile and unfriendly without the quality of human emotion to enrich it.