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The Nova scheduler determines which host to use for the instance. To do that, it first applies a number of filters that check things like CPU architecture, available RAM, available disk space etc. When you get No valid host was found, all your hosts are filtered out, for example if the instance requires more disk space than is available or no host has the correct CPU type.

To find out why the scheduler removes all your hosts, configure debug logging, restart the scheduler and launch the instance again. Then, check the scheduler log for filter messages.

See also http://docs.openstack.org/newton/config-reference/compute/schedulers.html.