There is a difference between a faction and a race. A faction belongs to one race, but a race can have multiple factions (this is what happens when you create custom factions - the race gains another faction).
Making something unique for a Race is easy, just put this in your item/improvement:
<Prereq>
<Type>Race</Type>
<Attribute>Race_Type_LivingStone</Attribute>
</Prereq>
where the Attribute is the InternalName of your Race (see CoreRaceTypes.xml, or in your faction's XML simply look up <RaceInternalName>Race_Type_LivingStone</RaceInternalName>).
Making something unique for a Faction requires that you "bind" the special something to a faction ability (like Altar faction has "Wanderlust").
<AbilityBonus InternalName="WanderlustAbility">
<AbilityBonusType>Player</AbilityBonusType> <!-- Remove this line if you don't want the faction ability to be available for playermade custom factions in the editor)-->
<AbilityBonusOption InternalName="Wanderlust">
<DisplayName>Wanderlust</DisplayName>
<Description>Unlocks Quest Maps, Athican Leather Armor, the Fending Blade and the Athican Longsword.</Description>
<Icon>Ability_Wanderlust_Icon.png</Icon>
<GameModifier>
<Provides>Unlocks Quest Maps, Athican Leather Armor, the Fending Blade and the Athican Longsword.</Provides>
</GameModifier>
<Cost>1</Cost>
<HideWhenUpgraded>0</HideWhenUpgraded>
<Type>Army</Type>
<AIData AIPersonality="AI_General">
<AIPriority>5</AIPriority>
</AIData>
</AbilityBonusOption>
</AbilityBonus>
then, in the item/improvement, you add
<Prereq>
<Type>AbilityBonusOption</Type>
<Attribute>Wanderlust</Attribute>
<Target>Player</Target>
</Prereq>
also, you must obviously add the faction ability to your Faction's XML:
<SelAbilityBonusOption>Wanderlust</SelAbilityBonusOption>
It is also possible to prevent a specific faction from gaining an item/improvement using this in the item/improvement:
<Prereq>
<Type>RestrictedAbilityBonusOption</Type>
<Attribute>Wanderlust</Attribute>
<Target>Player</Target>
</Prereq>
