Bulging soding

I hope you mean Siding. But yeah, that's the building or maybe a slipped piece of Styrofoam insulation. Or, it could be just some old trim-work that wasn't removed, a chimney protrusion, some really poor plumbing, a Radon Remediation Pipe or it could be a failing structural member(s) that the previous owner simply covered up to screw you but good. Remove the siding and get rid of it or at least know what it's from, it's not at all normal nor anything common.
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