You need to use shipping pallet wood.  This is wood you can get for a few dollars or for free from any large store such as Walmart.  They usually have these outside by their loading docks. Make sure the pallets you get are in good shape.  You remove the nails from the pallet wood and use this wood to build a rustic birdhouse.  Some of the wood is cedar and is very good for outdoor birdhouses. I have attached the specifications on how to cut the wood for a nice size birdhouse.  You will need nails, 1 1/2 inch drill bit, hooks for hanging and glue for adding wood so the birds can perch outside on the house.