To start by let me saying this, there are many different beliefs when it comes to magic and each have their own unique methods to set up a altar; that been said this method I found to my liking do to theory behind it.
**** Theory/History. ****
This method is known as Vastu Shastra [(Vastu: Sanskrit for living or house hold). (Shastra: Sanskrit for teaching)] .
Vastu Shastra originated 1000 years prior to any known practice in west or Europe, and 2000 years before Christ (B.C) In Ancient India (land of multiple language and religious ceremony). It is the art of organizing/building your living space to focus the energy in positive manner to achieve optimum results. [Please note this art predates Feng Shui] .
According to Vastu Shastra, Temple/ altar should be North-eastern part of the room, so when you are praying or performing ceremony you are facing north. Theory behind it this is quite simple, sun rises in the west and little known fact is that sun is the source of most earthly energy (please dont misunderstand it for the source they are two different things), this makes it so all the energy will be focused upon your place of worship (I.E. your alter) and it will be charged and will be ready to use.
As we all know, all living thing have their energy synchronized with magnetic north and south poles of earth. And so when you are facing north while performing your ceremony, the energy channelled will be balanced between pull of the two poles, north from front and pull of south from back.
The other aspect of the theory also states that, sun is known to pull the negative energy away when it sets, There for right side of your alter is facing to east while back its to North-East.
**** Instruction ****
1) Wake up early before sunrise give yourself at least 2hr to prepare.
2) Take shower and cleans yourself both physically and spiritually (Usually done with prayer while taking shower).
3) Sweep and mop the area designated for setting up your altar (must be done by you not maid or help), while doing this channel positive energy and visualize removal of negative energy.
4) After words spray the area with salt mixed in holy water and cast a magic circle. Visualize a barrier of energy and seal it, this barrier will repel all negative energy that comes near it. (Make sure to set a rule in barrier much like fire wall, example; let none but me enter this shrine spiritually).
5) This portion is most important set up your altar, before the sunrises hence the 2hr window. Make sure to time it well so you can go and take shower again to cleanse yourself of any negative energy that may have been left on you.
6) After you have taken your shower cloth yourself appropriately, reason is you do not want to end up bringing ill energy that will be attracted to you. Now invoke your deity of worship to that altar and give ask it to take its place there forever until you set up alter or move it. (Do be kind to deity they can destroy you if they choose)
7) Congrats your altar is now fully set up.
Note: Please make sure to pray/ channel positive energy at your altar for twice a day for 1 week. Once at sunrise, second at time of sunset, after which ask the being worshiped to pardon you, so you may channel as needed.
An altar is a working space and a space for your deity as well. There are also many other ways to set up an altar. Not one way is set in stone. So it really depends on how You would like to set up an altar. It is important to cleanse the area you will be using for your altar along with the altar itself.