El incidente fue en la casa.

Because in Spanish, the location of an event is usually expressed with ser, not estar.

So:

• La reunión fue en Madrid.
• El concierto fue en el teatro.
• El incidente fue en la casa.

By contrast, estar is normally used for the location of people and things:

• Juan estuvo en la casa.
• El libro está en la casa.

This is one of the most important ideas in the sentence.

Fue is the preterite form of ser (and also of ir), for él/ella/usted.

Here it means was in the sense of took place or happened:

• El incidente fue... = The incident was / took place...

The preterite is used because the incident is seen as a completed event.

Those are the definite articles in Spanish, equivalent to the.

• el incidente = the incident
• la casa = the house

Spanish uses articles very often, sometimes more often than English does. Here they are completely normal and expected.

Also:

• incidente is a masculine noun, so it takes el
• casa is a feminine noun, so it takes la

Because en is used here to mean in or at a place.

• en la casa = in the house / at the house

A usually shows movement toward a place:

• Fue a la casa = He/She went to the house

So:

• El incidente fue en la casa = the incident took place there
• Fue a la casa = someone went there

Yes, but the meaning changes slightly.

• en casa = at home
• en la casa = in the house / at the house

En casa is more general and idiomatic when you mean someone's home as a place of living. En la casa sounds more specific, referring to the house itself.

So:

• El incidente fue en casa = The incident happened at home.
• El incidente fue en la casa = The incident happened in the house / at the house.

It can mean either, depending on context.

• house when you mean the building
• home when you mean the place where someone lives

In this sentence, la casa most naturally means the house, because of the article la and the specific location. If the intended idea is more like at home, Spanish often prefers en casa.

It is understandable, and grammatically it works because events can use ser with a location.

However, many native speakers might more naturally say:

• El incidente ocurrió en la casa.
• El incidente pasó en la casa.

Ocurrió is especially common for incident:

• El incidente ocurrió en la casa = The incident occurred in the house

So your sentence is useful for learning the grammar pattern, but in everyday Spanish, ocurrió may sound more natural.

Because estar would make incidente sound like a thing physically located somewhere, which is not how Spanish normally treats an event.

An incident is an event, so Spanish usually says where it took place using ser or a verb like ocurrir:

• El incidente fue en la casa
• El incidente ocurrió en la casa

Estaba would be natural for a physical object:

• El informe estaba en la casa.
• La silla estaba en la casa.

Yes, but El incidente fue en la casa is the most neutral order.

Other orders are possible for emphasis, for example:

• Fue en la casa donde ocurrió el incidente.
• En la casa fue el incidente. (less neutral, more emphatic)

Spanish allows more flexibility than English, but beginners should usually stick with:

• Subject + verb + place

Fue is pronounced roughly like fweh in one syllable.

A simple breakdown:

• f as in English fine
• ue together, like we but with a slightly more open vowel

So not foo-ay and not fyoo. It is one smooth syllable:

• fue

Because fue can come from two verbs:

• ser = to be
• ir = to go

You tell which one it is from the context.

Here, El incidente fue en la casa cannot mean The incident went in/to the house. That makes no sense. So fue must be from ser:

• The incident was / took place in the house

Compare:

• Juan fue a la casa. = Juan went to the house. → fue from ir
• La fiesta fue en la casa. = The party was at the house. → fue from ser