I think that by "home directory" they mean not the root directory, but the directory which you first arrive at when you log in, which is /home/username
However, clarity of thinking in unix directory-naming conventions is nothing to write home about.
Did you know that the root directory contains a directory called 'root' (which is not a root directory, but is the home directory of the user called 'root')?
And did you know that the root directory also contains a directory called 'home' (which is not a home directory, but is a directory containing home directories)?
So anyway, I think that what you want to do is create a directory named '.ssh' in your home directory, which is /home/username and which, as a special convenience, is also designated by the character '~'
(which, incidentally, is called a 'tilde' by some authorities but is called a 'swung dash' by others)