I think you'll be right if you won't deduct expenses. "Passive income" as a term is usualy used as an opposite of "active income" generated by work or trading. "Expenses" is deducted from "income" to calculate profit/loss. In your example what you call "house income" would be "passive income", interest and other expenses will form "expenses".
Passive Income is the "accounting" term for income where you can lie on the beach, or in some other "inactive" location, and the biggest decision you have to make is what you'll have for lunch .....and the passive income (cash etc) keeps flowing into your bank account even if you decide you just want to lay on that beach for ever !