Water penetrates river rock faster than anything I know of. You need to get solid, packable dirt around the house to deflect the largest part of the water runoff during rain. Snow and ice will also be a problem in river rock during the winter months. The river rock would be best below the frost line IMHO. But it seems like it rarely ever is. The river rock will pool water against the house instead of assisting in routing it away if you get too crazy with it.