Can the new epic battle take control of the location on House of dreams? thanks

Yes. It's a claim replacement.

-Istaril said:

Big nod of agreement… and the person running said HoD location is usually none too happy. I've used this little gem to steal a Tunnels of the Red Keep, and, suddenly, those weenies that used to be +8 STR are back to being just little 1 and 2 STR fodder… plus, if you use this to steal the HoD location it still has immunity from the controller's (now you) opponent's non-plot effects, because it never left play.