Solution:
The correct option is C) ‘That is my house'. The words that are used in place of a noun are pronouns. The name of a person, place, animal, or item can be the noun that is replaced. Pronouns that stand to show possession or ownership of someone over something are known as possessive pronouns. The given statement, ‘That is my house.’, shows that the ‘house’ is a possession of the concerned ‘my’ in the sentence. In the other three options no possessive pronoun can be observed; hence making option (C) the required answer.