i pretty much agree with everything Piper has said, but I’d like to add a few things.

when you’re home, take him out every half hour.  set him up for success, and don’t let him urinate or defacate anywhere in the house.  this sets a rule – it tells him outside is where he’s to do his business.  every time he DOES use the yard, throw a party.  make it rain treats.  make him think he just did the best thing ever.  throw out the pee pads, all they do is teach him it’s okay to pee in the house, plus they act as a possible obstruction if he ever decides to eat the plastic.

i want to reinforce: make sure he’s EMPTY before you come inside for the night. this is really crucial to his training and the comfort of your sense of smell. 😉  and for now it may be best to get up in the middle of the night to take him out, just until he gets the hang of sleeping through the night.  we had to do that with our previous puppy until his death – he couldn’t hold it due to a birth defect, and it made everyone happier if no one had to clean up a lake of urine every morning.  

do you crate him?  this might be more effective than pee pads in a pen – get a crate appropriate for his adult size, but make sure it has a divider, and set the divider so he has just enough room to turn around and lie down.  make sure it doesn’t start out smelling like urine, too. 

to clean up your house and any of his stuff, use an enzyme cleaner.  Nature’s Miracle can help – we found some success with it – and it’s available at Petsmart/Petco.

if he’s eliminating during the day, can someone come home around lunchtime?  if you can’t come home, can you hire a dog walker to let him out, or maybe a trusted neighbor?  that really would help a great deal.

Basics of potty training: 1. you need a crate – you can get a large crate that will hold his adult size but has a divider so you can make it small for him now. He should only be able to sit up and lay out flat in his crate, no more room than that. Or get a small crate now, and a larger crate as he grows (keep the small crate for the next puppy, or sell it on Craigs List).
2. When you are not watching him he is in the crate.
3. When he comes out of the crate he goes outside — does not pass go, does not pick up a ball…right outside until he pees and maybe poops (depending on time of day). When he does his business it make it rain treats, jump or joy, and laugh! Then play with him outside for a few mins so he connects being outdoors and peeing outdoors with fun and games.
4. He is allowed back into the house and the freedom to explore as long as you can watch him to make sure he doesn’t have an accident. You might want to tie him to you (leash) while you move through the house, just so you know what he is doing and he can’t disappear and have an accident while you are cooking or such.
Remember: He goes back outside after a meal (eating = bowel movement about 15 to 20 after a meal)
He goes back outside after active playing (exercise and excitement = pee and/or a bowel movement).
He goes outside right before getting into his crate for the night, and don’t give him water after he pees so he can make it through the night.
During the times he is out of the crate, take him outside every hour or so and give him a command to pee (do your business, get busy, …)
Sleep in something that you are not embarrassed to wear outside in the middle of the night so you can jump up and take him outside if he whines or stirs around in his crate in the middle of the night.

this is an awful plan. water is more necessary than food to live. restrict water and you could cause even further problems.