Housed around waterway (4)
I believe the answer is:
ouse
'waterway' is the definition.
(the River Ouse)
'housed around' is the wordplay.
'around' indicates a hidden word.
'OUSE' is hidden within 'housed'.
(Other definitions for ouse that I've seen before include "Flowing water" , "One of several rivers" , "bird has lost its tail" , "River flowing through York" , "Lewes's river" .)