Learn Hardcore Swedish: Utanför huset finns en liten parkering där grannarna ställer sina bilar. - Outside the house there is a small parking lot where the neighbors park their cars.

finns comes from the verb finna(s) and is used in existential sentences – when you talk about something existing or being located somewhere.

Det finns en liten parkering utanför huset = There is a small parking area outside the house.
Parkeringen är liten = The parking area is small.

Use finns when you mean “there is / there are”.
Use är when you give a description or identity: “X is Y.”

Why does the sentence start with Utanför huset and not with en liten parkering?

Swedish main clauses normally follow the V2 rule: the finite verb (here: finns) must be in second position, regardless of what comes first.

In your sentence:

Utanför huset – place adverbial (position 1)
finns – verb (position 2)
en liten parkering – subject (position 3)

You could say:

En liten parkering finns utanför huset.

That’s grammatically correct, but starting with Utanför huset is more natural here because it emphasizes location first, then tells you what is there. This kind of fronting of a place adverbial is very common in Swedish.

Could I also say Det finns en liten parkering utanför huset? Does it mean the same?

Yes, that is very natural Swedish:

Det finns en liten parkering utanför huset.

Both sentences mean the same thing. The differences:

Det finns ... utanför huset is a very typical existential pattern (like English “There is … outside the house”).
Utanför huset finns ... puts a bit more focus on the location first, then introduces what is there.

Both are correct and common.

Why is it huset and not hus?

Because huset is the definite form: “the house”.

ett hus – a house (indefinite, neuter)
huset – the house (definite)

In Swedish, you usually mark definiteness with an ending, not with a separate word like English “the”. So huset already contains the meaning “the house”; you don’t add another word.

What exactly does parkering mean here? Is it a verb or a noun?

Here parkering is a noun:

en parkering – a parking lot / parking area
parkeringen – the parking lot

The verb is parkera:

Jag parkerar bilen. – I park the car.

So in the sentence, en liten parkering means “a small parking area / small parking lot”, not the action of parking.

Why do we use där and not var in där grannarna ställer sina bilar?

där is used as a relative adverb meaning “where” in this kind of clause:

… en liten parkering där grannarna ställer sina bilar.
= … a small parking area where the neighbors put/park their cars.

var is mainly:

a question word: Var är du? – Where are you?
used in some fixed patterns like var som helst (anywhere)

In a relative clause (“where they…”) referring back to en liten parkering, Swedish uses där, not var.

Why is the word order där grannarna ställer sina bilar and not där ställer grannarna sina bilar?

Because this is a subordinate clause, and Swedish subordinate clauses do not follow the V2 rule.

Word order pattern in such clauses:

[där] + [subject] + (sentence adverbial) + [verb] + …

So:

där grannarna ställer sina bilar ✅
där ställer grannarna sina bilar ❌ (sounds like a main clause stuck after där)

Compare:

Main clause: Där ställer grannarna sina bilar. (Here där is first and ställer is second = V2.)
Subordinate clause: … där grannarna ställer sina bilar. (No V2; subject before verb.)

Why is it ställer and not parkerar when talking about cars?

Both are possible, but they have slightly different flavors:

ställa = to put/place something so that it stands (upright / in a fixed position).
It’s often used colloquially for placing objects, including cars:
Jag ställer bilen här. – I’ll put/leave the car here.
parkera = to park (specifically the action of parking a vehicle):
Jag parkerar bilen här. – I’m parking the car here.

In your sentence, ställer sina bilar is very natural and idiomatic – it focuses on where the neighbors put their cars. parkerar sina bilar would also be correct and maybe a bit more “textbook” in meaning.

Why is it sina bilar and not deras bilar?

Because sina is the reflexive possessive pronoun referring back to the subject of the same clause, here grannarna.

grannarna ställer sina bilar
= the neighbors put *their own cars* (the cars belong to the neighbors themselves)

If you said:

grannarna ställer deras bilar

this normally means “the neighbors put *their cars” where *the cars belong to some other group of people, not to the neighbors. deras is non‑reflexive: “their (someone else’s)”.

How does sin / sitt / sina work in general?

sin / sitt / sina all mean “his/her/its/their own”, but they:

Refer back to the subject of the clause (reflexive).
Agree with the grammatical form of the possessed noun, not with the subject.

Patterns:

sin
- en‑word (singular):
  - Hon parkerar sin bil. – She parks her (own) car.
sitt
- ett‑word (singular):
  - Han parkerar sitt husvagnsekipage. – He parks his (own) caravan outfit.
sina
- plural noun:
  - De ställer sina bilar. – They put/park their (own) cars.

So in your sentence, bilar is plural, so you must use sina: sina bilar.