It's not really DIY since all of the pieces are precut and ready to assemble together, but this birdhouse is a great project for younger kids to do with a parent, and they'll enjoy decorating and painting it as well.
Perhaps the real fun would begin once the birds stop by to eat. Learning about the different kinds of birds that live in your neighborhood would be a great activity to enhance this project. And taking photos if you can or keeping a chart of all of the birds you identify would also be fun.
Find this birdhouse here