Translation:I am going to transform my house in a palace.
In French, I would skip the indefinite article: je vais transformer ma maison en palais.
"en" is very versatile, it does not only mean "in" but it also contains an article, like "je vais en Italie" (lit. à la), or "repose en paix" (lit. dans la), "j'y vais en voiture" (lit. dans une).
It is probably the only preposition that does not always require an article.
Just seems more natural that way. Same as you might say 'Je suis avocat' when talking about your profession.
The way they have this sentence, it sounds like somebody is going to have their house inside of a palace and then transform it into an unspecified "something".