Translation:Peter lives near Julia's home.
"close by" should also be correct, no?
Is ke ghar necessary?? Can we say "peter julia ke paas rehatha hai"?
I think "Peter Julia ke paas rehatha hai" would translate to "Peter lives near Julia". If you want to specify that he lives near her home than I think the "ke ghar" is necessary.
"ghar" is "home" and "house" both. The translation should reflect it.