Is this the correct way to form this sentence?

Only the second sentence is correct; the inversion used in the first is never made in the context of the noun (information) being the subject of the verb (instead of the antecedent of the pronoun, as must be necessarily the case in this first sentence), and according to what you have in mind to say, it has to be the subject of the passive verb (as in the second sentence);

Second sentence

• Imagine buying a house about which information has been been withheld. (antecedent of "which": "house"; S of "has been withheld": "information")

In the first sentence (which is not correct for several reasons), you can't interpret "information" as the subject and it must be the antecedent of "which"; moreover for this possibility to be confirmed as resulting in a valid sentence, "which" must have "information" as an antecedent (not "house"), and you must have a modification of the matrix clause as "information" can appear only in an apposition where it is repeated (since after a comma it does not belong to the matrix clause). Finally, you have to say something somewhat different, and you have to add a subject. There is no other way to fit that first construction to what you want to say.

Instance of making the "inversion" meaningful in the first sentence
(There is no real inversion involving the relative "which"; this use of "inversion" refers subjectively (not grammatically) to the order in the second construction; there is however an inversion "S/V", which is now necessary.)

• Imagine buying a house on the basis of faulty information, information about which has been withheld important explanation (and not information based on falsity).
  ("which": adverbial; antecedent of "which": "information"; added subject: "important explanation")

---

Addition prompted by comments from user Edwind Ashworth

The first sentence appeared to me so abnormal that I didn't think about the need for a reference; however, it appears that my certitude does not correspond perfectly to reality as shows user Edwin Ashworth, who provides some recent examples; nevertheless, my assertion, supported by the strong impression of having never found this construction, is not devoid of a serious basis, which is to be found in the following constatation made in CoGEL (A Comprehensive Grammar of the English Language, Quirk et al.)

(CoGEL p.365 § 6.32) "Relative pronouns differ from personal pronouns in that the element which contains or comprises the pronoun is always placed at the beginning of the clause, whether it is subject, complement, adverbial, postmodifier, prepositional complement, or object.".

This sounds correct, albeit somewhat strange:

Imagine buying a house, which information has been withheld about.