The cottage, as it's name suggests, can be found in a hidden location north of Midway Village, the primary settlement in the Heartlands. Following the road north (marked as leading to Ponydale) leads to a fork at the foot of a tree-covered hill. Leaving the path and climbing the hill will reveal the cottage on the western end of the hill.
The Hermit's Cottage is a dark gray stone structure with a thatched roof with its door on the east side. It cannot be entered, but the NPCForeshadow can be found on the front porch; talking to her can start the Shown Their Workquest.