There is a lot that is not natural about this conversation
A: I understand a party will be held in a house next Saturday night. Are you going to the party?
1. "A party will be held" is grammatical but not natural.
2. "in a house" -- no one would ever say that. That's too vague to be useful.
3. We would not repeat "the party."
I understand Tom is having a party at his house next Saturday night. Are you going?
I understand there's going to be a party at Tom's house next Saturday night. Are you going?
I hear there is going to be a party next Saturday night. Are you going?
B: Yes, but where is the house?
Yes, but where does he live? or Yes, but where is it? (if you don't specific whose house).
A: 17 Newtown Crescent.
B: I see.
These are okay
A: Well, let’s meet at the house on a river, OK?
Change "a" river to "the" river, because you are referring to a specific house which is on a specific river. To use this, A must know that B knows which house on which river you are talking about.