Drill a hole in the center of one of the 7-by-7 pieces of plywood using the 1-inch hole cutter attachment and the power drill. This will be the entrance and exit of the birdhouse.
Turn the piece of plywood with the entrance hole so that it looks like a diamond rather than a square.
Create a small hole half an inch below the entrance hole using the ¼-inch drill bit and the power drill. This hole will be used for the placement of the dowel rod as a perch.
Squirt glue onto the top two edges of the piece with the entrance hole.
Lay one of the 8-by-8 pieces onto the glue to create half of the birdhouse's roof. The top edge should be flush with the top corner of the front piece, while the bottom edge creates a 1-inch overhang. The front-facing side of this piece should hang 1/2 inch over the face of the house. Repeat this step with the other 8-by-8 roof piece on the other top edge, but add glue to the top edge of the first roof piece and place the second piece so that its end is flush with the surface of the first piece.
Place a line of glue on two of the edges of another 7-by-7 piece of plywood in the same manner as the front piece. This will be the rear of the birdhouse. Secure this piece to the opposite end of the roof, 1/2 inch from the edge so that this side has the same overhang as the front.
Line the bottom four edges of the birdhouse with glue. Place one of the remaining pieces of plywood so that it is flush with both the front and rear pieces of the birdhouse. Repeat for the final piece on the other side of the bottom. This will create an enclosed cube.
Hammer three tacks into each piece of wood where it comes into contact with another piece of wood. This will reinforce the structure.
Paint the bird house if desired. Paint the dowel rod as well, before securing it the house. Leave the entire piece to dry overnight before proceeding.
Spread a drop of glue all around the bottom 1/2 inch of the dowel rod. Stick the glued end into the hole under the entrance hole. Let the glue dry for at least 24 hours before placing the birdhouse outside.