Is it OK to tag a building with information that reveals identity of the occupant?

Generally speaking, the name tag is not something that you can liberally use to display a text on the map; you can only use it if an object really has that name. A name tag on a house would be appropriate if that house bears a sign spelling out the name, or if at least there's a good chance of someone in the area, when asked "what is the name of this house", indeed responding with "why, that's Max's Residence of course". (Even then, for houses, addr:housename is usually the better tag.)

With names or identities of people we have the added complication of data protection; the name or identity of the occupant can generally only be mapped if they are soliciting business ("John Smith, Carpenter") but not if they're just living there in a private capacity. In theory, someone can of course voluntarily add information about themselves, but how are we to know that the person who tags "Max's Residence" is really Max, and is old enough to make an informed decision about their data protection rights?

In all likelihood what you are seeing is teenage doodles where people add each other's houses (and the next level is "names" that inform us about how untidy or immoral the place is). Delete the name, and add a nice changeset comment as suggested in cachafish's answer.

Personally, I delete the name tag when I see someone has named a building after him/herself. If there's doubt as to whether the name is correct, you could contact the creator of the information. An explanation of your deletion in the changeset comments is appropriate when you save your change.