Mixing icing is a double edged sword. It's much easier to mix it all ahead, but you need to use it in a timely fashion or it hardens. I usually mix it up, and try to fold the pastry bags over to keep the top from drying out. If I need to keep icing overnight I put it in a Tupperware container right in the bags. Keep toothpicks handy for cleaning out tips, and a paint brush works well too for getting into the points of the tips.
Toothpicks work well for helping correct errors, keep some handy.
Color small batches of this icing as needed with Wilton decorating pastes, which are much more intense and not watery like liquid food colors. Practice on wax paper before you try and decorate on the house. You might also want to decorate the house pieces flat before putting them together. It can be much easier to do intricate decorations flat rather than trying to work vertically. I put a little icing into a small container or bowl and then add just the smallest amount of water.