Timber and wool are two of the most important industrial resources early in the game, so you should look for a site adjacent to scrub or hardwood forest, or adjacent to fertile hills. Iron ore is equally important; but, since it must be prospected for, you cannot know for sure where it is.

A good city site tends to be near those resources that are not immediately adjacent so you can access them rapidly once the game begins. For instance a site within five tiles of a large number of hills and mountains is likely to be close to iron ore. A site that is not adjacent to any wool or timber should at least be near them for rapid development.