Fill It
All that empty space in your friend's house is just begging to be filled with blocks of your choosing. How much this will annoy your friend largely depends on which blocks you use. Gravel and sand, for example, are very easy to remove; on the other end of the spectrum is obsidian, which, unless your friend has a diamond pickaxe, takes more than four minutes per block to remove.
Drown It
This method of griefing also involves filling your friend's house. Instead of solid blocks, though, you use either water or, if you are feeling particularly destructive, lava. The latter will set fire to anything flammable it touches. Simply empty water or lava buckets all along the underside of the house's ceiling. If using lava, be careful not to die to it.
Wall It Off
Griefing doesn't necessarily have to be destructive. Completely surrounding your friend's house with obsidian blocks leaves it and its contents intact, but makes it difficult at best and impossible at worst for him to enter -- or to leave, if he happens to die and reappear inside the house before he discovers what you've done. Remember to dig underneath his house and place a layer of obsidian there as well to prevent him from simply tunneling under the wall. For added annoyance and difficulty, place lava on top of the obsidian enclosure so it flows down to the sides or make the walls several blocks thick.
Hide It
If your friend is off doing something else and you have a lot of time and dirt blocks on your hands, build a hollow but natural-looking mountain or hill on top of your friend's house. For added effect, plant some saplings on it and grow them into trees instantly using bone meal. If your friend had a road going to his house, remove at least part of it to leave your friend thoroughly confused as to where his house has gone.
Do Some Gardening
For this method, you will need a lot of saplings and a lot of bone meal. Simply plant saplings all around your friend's house and grow them into trees instantly using the bone meal. If there's enough space, you can also grow some trees inside your friend's house, provided it has a dirt floor; if all else fails, you can replace a few floor blocks with dirt, destroy the roof, grow a few trees and then replace the roof as much as possible. You can also use bone meal on grass blocks to grow tall grass and flowers -- something which is sure to annoy your friend if he prides himself on the tidiness of his house's lawn.
Close But Not Quite
Replace some of the blocks in your friend's house -- or all of them, depending on your preference -- with similar-looking ones to confuse and unnerve your friend. For example, you could replace his entire lawn with green wool or hardened clay, or all the wood with a different variety of it.
Booby-Trap It
Set up one or more traps in your friend's house, taking care to ensure they are as well-hidden as possible. One of the easiest ways to do this is to tunnel underneath your friend's house, starting one block below his floor, and place one or more blocks of TNT. The more you use, the bigger the explosion. Once you're done placing TNT, climb back out, fill in the hole and place a pressure plate on the floor of the house on a block that's directly above a TNT block. Make the pressure plate from a material that blends in with the house's floor, such as wood for a wooden floor, or take advantage of pressure plates that already exist -- for example, your friend may have set up a pressure plate to automatically open his door.
Create Endless Noise
If you're handy with redstone, you can create a mechanism that will make one or more doors open and close endlessly without needing you to interact with it. Place redstone repeaters in two adjacent blocks, facing opposite directions, and then connect them with redstone on both sides. Place a redstone torch next to the redstone to activate the circuit and then remove it to make it self-contained. Destroy one of the redstone tracks and immediately replace it to turn the always-on circuit into an automatic, endless on-off one. Place one or more doors and connect the circuit to them with more redstone. If you do this correctly, each door will be opening and closing automatically, very rapidly. Dig a hole directly underneath your friend's house, set up this mechanism inside and then close up the hole so there is no evidence of foul play. The sound of the doors opening and closing will very quickly irritate your friend. For extra annoyance, encase the mechanism completely in obsidian so it's harder to remove.
Rewire Everything
More experienced players tend to have complicated redstone creations in their houses. If your friend numbers among them and you are handy with redstone yourself, simply go in and rewire all his circuits so they don't work at all, do the opposite of what they were intended to do or have unexpected effects.
Just Destroy It
It might not be very creative, but sometimes you can't beat plain destruction for sheer griefing potential. Set off a huge TNT blast yourself, set fire to anything flammable, demolish the house block by block -- no matter how you do it, the end result is empty space where your friend's house once stood.