If you look at any map of Tatooine, you will see that Luke’s house was in the south of the planet, not far from Mos Eisley. In the video game, it can be found in the southeast, near a workshop.

with scrolling text establishing that you are a Padawan in Luke Skywalker's fledgling Jedi Order. The Empire has fallen and you've been sent to Tatooine on some mysterious training mission.