Office gossip is never appropriate, but I don't think it will ever be stopped.
I think that you are likely putting too much thought into it. It is likely small talk. Yet my years in security have taught me not to disclose more personal details than I am comfortable sharing. I would answer with anything from to "Uptown" to "Forty-five minutes from here and the commute is brutal. What is yours like?"
Think of small talk like tennis. When they lob the ball towards you, you can hit it back or simply walk away. If you are an advanced player, you could throw in your own twist. "I live in Uptown about forty-five minutes from here. I decided on the location due to the current urban renewal. My Real Estate Broker said it would be a great investment. At least that is what I remind myself when I am in the car for an hour and a half each day. Have you tried any new restaurants you like recently?"
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