Sorry to hear another person is facing dementia challenges!! Not a path anyone would sign up to live on.
The first thing to note is that you will have this conversation many times with your beloved person. The memory slate is often wiped completely clean (like in the movie "50 First Dates") so while support for you might be helpful, it may not be needed for your person. In all likelihood you will have this conversation many times.
One thing many people try is to acknowledge there are changes going on in your person's brain. They can often feel the loss of control of memory as they know they can't do many of the things they used to do. Doctors are trying to find the right way to slow down the loss. I told my husband we were working with the doctor to try to get his brain better which is part truth and part theraputic lie/fib. With Alzheimer's (in our case), there is no cure, only a continued trajectory of loss.
Does it really matter factually about his home? What I said was that as soon as the doctor said we could take him home, I would be there to pack his bags and we'd get out of Dodge. So the doctor was always referenced. And if God should heal his brain, it would not be a lie!! I would pack his bags and take him home!!
Does it hurt him not to know his home is not there? For us, yes. But for him, I am not so sure. Does it really change anything? One often hears a discussion about meeting a person where they are at, so you understand he wants to go home, he misses his home; acknowledge those emotions. We all feel best in our own home, with a greater feeling of control.
People talk about not telling a person each time they ask about their mother who has passed that "Mom is dead" because they suffer that grief each time!! I would say the same applies to the sale of the house. Why give needless grief? My husband thinks his car is still in the garage ready for him to drive; it doesn't hurt anything for him to believe it's still there as he no longer lives at home and can't access the car.
Talking about safety can be helpful. Also telling them how proud of them for doing all this work to get their brain stronger. Things like exercise, talking, eating good foods, participating in activities are part of a healthy life for all of us. I would try to appeal to a sense of 'normal' behavior as much as I could, because it's not talking down and it may resonate with memories for your person.
Remember no matter what you try, be as calm and as pleasant as you can because most of the time your person will soak up and reflect back your emotions!! It's called being a 'mood sponge.' Nothing will work all the time.
Join a support group, take a care giver's class, use supportive resources like the book "The 36-Hour Day" by Nancy Mace and Peter Rabins. Keep chatting like this to get support!!

I vote that there is no good reason he HAS to be told- why tell him something that will make him sad and angry? Does it really matter that he be told this upsetting information? Which he will most soon definitely forget? I use "the doctor wants you to stay here for now to get the extra support" (his PCP's suggestion). Then you turn the conversation to fun memories of things we did at the house when ...We've laughed and laughed about the time one of the kids.....or when Mother dropped the lasagna....
Who is telling him helping? Telling him will make YOU feel better as you tell yourself you're being honest, not hiding information, etc, but this is the time to think about him and his feelings.
I used to work in a SNF where a devout Catholic lady with Alzheimers would become quickly agitated that she needed to catch the bus to meet the Pope (he did come to Boston). We would say that he was running late and would be there to meet her. She would calm immediately. Did she need to be told the truth? It's called "Validation".

@cec75 I like many of the answers that members have given you. Maybe you could make assisted living a little more homelike. Maybe have “happy hour” with him once or twice a week. (No alcohol!). Or bring a few of his favorite things from home. Just a few suggestions to him so he will begin to think he is home.
What other things can you think of?