Keeping ALL water out is easy, but truly Hermetic effects aren't generally intelligent enough to handle the needs to both acquire and resist water unless you have a lot of them. Of course, if people were living here a long time, they may have had the time and resources to do all that work. You could, for example, split the covenant into sections warded separately, and have a very sturdy, ideally otherwise watertight outlying building (probably built with a ritual, since I don't think medieval construction could be sufficiently water-resistant everywhere except the intended entry point) with a pipe or window whose water ward is enchanted to be able to turn on and off. Then you could put down a big basin or dig a well or something, and catch lots of water, then reactivate the ward. You would probably need to do this at the specific building(s) where you want the water used.
This method won't work for disposing of waste water, so you'll want a PeAq effect to deal with that. Maybe also Pe(some other stuff), since I don't think PeAq alone could dispose of feces and whatnot, and there's nowhere else to shovel those off to.
How does this place get food, metal, lab supplies? You can't magically create anything permanent and capable of sustaining a population without a Ritual, so unless the covenant is extremely vis-rich, you need to have constant supply lines with the surface, or somehow figure out a way to farm underwater in light of the warding-out-water thing.
No, all of this is to say I'm with the other posters - doing this with purely Hermetic effects is going to be almost impossible.
However, you can use purely Hermetic effects to get someone else to do it for you! See the previous points about making deals with water spirits or the lake itself. If the magic is being intelligently managed on the fly, then suddenly all of this becomes a lot easier.
Iirc, some Mysteries or other slightly-off-Hermetic Virtues would be well-suited to directly binding such a water spirit to the location, if you wanted it done by force rather than by way of deals that need to be upheld, but I think having a local spirit whose terms you need to stick to to keep your covenant protected and provided for sounds like a great Hook.