Latem lubię siedzieć na balkonie wieczorem.

Because after lubić (to like), Polish usually uses the infinitive of the next verb.

So:

• lubię siedzieć = I like to sit / I like sitting
• literally: I like sit

This is very similar to English I like to sit.

More examples:

• Lubię czytać. = I like to read.
• Lubię spacerować. = I like to walk.

So lubię siedzieć is the normal structure.

In Polish, subject pronouns are often omitted because the verb ending already shows who is doing the action.

• lubię = I like

The ending -ę tells you the subject is I.

So:

• (Ja) lubię siedzieć na balkonie wieczorem.
• Lubię siedzieć na balkonie wieczorem.

Both are correct, but the version without ja is more natural unless you want emphasis.

For example:

• Ja lubię siedzieć na balkonie, ale on nie.
  = I like sitting on the balcony, but he doesn’t.

Latem is a very common adverb-like form meaning in summer / during the summer.

So:

• latem = in summer
• zimą = in winter
• wiosną = in spring
• jesienią = in autumn

These are standard time expressions in Polish.

You may also hear:

• w lecie = in the summer

but latem is shorter and very natural.

So in this sentence:

• Latem lubię... = In summer, I like...

In modern usage, it functions mainly as a fixed time expression, but historically and grammatically it is connected with the instrumental case.

That is why it has the ending -em.

For learners, the most useful thing is to remember it as a common set phrase:

• latem = in summer
• wieczorem = in the evening
• rano = in the morning
• nocą = at night

You do not need to analyze it deeply every time—just learn latem as the normal word for in summer.

Because siedzieć means to be sitting / to sit as a state, not the moment of sitting down.

Compare:

• siedzieć = to sit, to be sitting
• usiąść = to sit down
• posiedzieć = to sit for a while

So:

• Lubię siedzieć na balkonie. = I like sitting on the balcony.
• Lubię usiąść na balkonie. = more like I like to sit down on the balcony
• Lubię posiedzieć na balkonie. = I like to sit on the balcony for a while

In your sentence, siedzieć is the best general choice because it describes the activity itself.

Polish uses na with some places that English expresses with on or sometimes even in.

A balcony is understood as a surface/open space, so Polish says:

• na balkonie = on the balcony

not:

• w balkonie = this would sound wrong here

Other examples with na:

• na stole = on the table
• na tarasie = on the terrace
• na dworze = outside

So na balkonie is simply the correct prepositional phrase.

Because after na when talking about location, Polish uses the locative case.

Base form:

• balkon = balcony

After na for location:

• na balkonie = on the balcony

So the noun changes form:

• balkon → balkonie

This is a normal pattern. More examples:

• stół → na stole
• taras → na tarasie
• krzesło → na krześle

Here, the phrase answers where?, so the locative is used.

Wieczorem is the normal Polish expression for in the evening / in the evenings depending on context.

So:

• wieczorem = in the evening

This is much more natural than trying to say w wieczór, which is generally not how Polish expresses this idea.

Similar time expressions:

• rano = in the morning
• po południu = in the afternoon
• wieczorem = in the evening
• nocą = at night

So in this sentence:

• na balkonie wieczorem = on the balcony in the evening

Like latem, wieczorem is an instrumental-form time expression.

Base noun:

• wieczór = evening

Time expression:

• wieczorem = in the evening

For a learner, the key point is that some Polish time expressions use forms that look like the instrumental and function almost like adverbs.

Other similar examples:

• latem = in summer
• zimą = in winter
• wieczorem = in the evening

It is best to learn these as common whole expressions.

Yes, but they refer to different kinds of time:

• latem = during the summer → a broad time frame
• wieczorem = in the evening → a smaller time frame

So the sentence means something like:

• In summer, I like sitting on the balcony in the evening.

This is completely normal. One tells you what season, and the other tells you what part of the day.

The word order is fairly flexible, though some versions sound more natural depending on emphasis.

Your sentence:

• Latem lubię siedzieć na balkonie wieczorem.

This is natural and clear.

Other possible versions:

• Wieczorem latem lubię siedzieć na balkonie.
• Lubię latem siedzieć na balkonie wieczorem.
• Latem wieczorem lubię siedzieć na balkonie.

These may be grammatically possible, but not all sound equally natural. The original sentence is good because it presents the broad setting first (latem) and then the more specific time later (wieczorem).

A very natural alternative is also:

• Latem lubię wieczorem siedzieć na balkonie.

That places wieczorem closer to the verb phrase.

It depends on context, but in this sentence it most naturally means in the evening / in the evenings generally.

Because the sentence is about a habit or preference:

• Latem lubię siedzieć na balkonie wieczorem.
• In summer, I like sitting on the balcony in the evening(s).

Polish often does not need a separate plural idea here. The adverb wieczorem can express a general habit.

Yes. That is a very good translation.

Depending on style, it could also be:

• In summer, I like sitting on the balcony in the evening.
• During the summer, I like to sit on the balcony in the evenings.

The Polish sentence is slightly flexible in how naturally it maps into English. The main ideas are:

• latem = in summer
• lubię siedzieć = I like sitting / I like to sit
• na balkonie = on the balcony
• wieczorem = in the evening

Yes, it is natural and understandable.

A couple of very natural variants are:

• Latem lubię siedzieć wieczorem na balkonie.
• Latem lubię wieczorami siedzieć na balkonie.

The second one, wieczorami, means in the evenings more explicitly and can sound especially natural when talking about repeated habit.

So:

• Latem lubię siedzieć na balkonie wieczorem. = correct and natural
• Latem lubię wieczorami siedzieć na balkonie. = also very natural, with a stronger sense of repeated evenings

Both are good Polish.