On this page of the guide, you will learn whether you need to be familiar with Resident Evil 7 before playing Resident Evil Village. This may be important if you don't want to feel lost while discovering the story of the new game.
Resident Evil Village is a continuation of the events of Resident Evil 7. The main character is once again Ethan Winters, known from RE7, and the game also features other characters from the previous game, for example Chris Redfield.
Completing Resident Evil 7 can enhance your enjoyment of playing Resident Evil Village, but is not required. This is primarily because Resident Evil 8 features an optional recap of the previous game. The game will give you an option to watch it when you start Resident Evil Village for the first time. The recap is also available from the main menu (Bonuses -> Movies -> Remembering Resident Evil 7).
The recap is a good introduction for new players, but it can also help you if you don't remember the plot of RE7 very well. Unfortunately, it is not very comprehensive and only focuses on the major plot points. The recap also skips the events that took place in the story DLCs for Resident Evil 7.
To conclude, you should first complete Resident Evil 7 along with the story DLCs and only then should you approach Resident Evil Village. However, you don't have to worry about having serious problems understanding the plot of RE8 if you skip the previous part.