how do you make buildings? out of what?

Have a look to these threads, sure you'll find what you're looking for:

https://armorama.kitmaker.net/forums/10746&page=1

https://armorama.kitmaker.net/forums/10705&page=1re

Ciao

Personally I have never done a dio with buildings, however, if I were to I would probably buy a premade one. From what I have seen in your previous threads I would assume you are making a dio based on the current conflict. I know the Verlinden offers a few houses that you might want to think about. Below are links to a few.

http://www.verlinden-productions.com/vp_htm_0001_0400/vp0099.htm

http://www.verlinden-productions.com/vp_htm_0001_0400/vp0111.htm

http://www.verlinden-productions.com/vp_htm_1201_1600/vp1577.htm

Check out Keiths Building from scatch digital diamond in the Feature section under dioramas. That will give you a great start- take a look and ask questions from there we'll help out with the details.

Slodder is right

Keith`s feature is a good start for making buildings.

I also want to give you this link. It`s a link to an article I wrote about the dio I made for the winterdiorama campaign here on armorama. There is a big part written about the making of the ruined building.
Distraction step by step

By the way this is the link to the article of Keith.
Building a dio from Scratch by Keith F. Magee

Hope it is of some help