Are there any rules to tell when you should contract the article with the preposition and when not? Why is it "in dem Haus" here and not "im Haus"?
"im Haus" is also correct. But I'd prefer 'in dem' in this case as the contraction sounds a bit sloppy.
Why not 'There are two people in the house'? It seems more natural to me in English than 'Two people are in the house' but I'm not a native speaker so not sure if I should report it or not. :)
@diabLEEca : For 'there are' the following would be used: es gibt or es sind
I'm with diabLEEca... you wouldn't really say this in English but, rather, there are two people in the house
It depends. 'in' is a two-way preposition. If motion is implied ('into' in English), use the accusative.
I'm not a native but from my understanding it works like this. The accusative case is used when the sentence expresses change of position or movement toward a place, while the dative case is used when the sentence expresses position or place within a fixed location.
So if there's movement you would use the accusative case; therefore, in, and if a fixed position is implied then dative, which would be im, for In + Dem. So accusative = in, oder in den und dative = in dem, oder im!