can anyone tell me how exactly a solar panel works, and what i would need if i was to make one myself? i have been looking at the option of running my house on solar power, but the panels themselves wolud cost over $5000. so surely there must be a way to do this myself cheaply.

What sort do you want? You can easily make solar panels to heat water, a metal radiator, painted black, under glass and plumbed to a water tank will work just fine using nothing more than convection to move the water around the system. This will increase the base temperature of your water, so it requires less energy to heat to a final temperature.

If you want to make electricity, forget it. Buy, it's the only way, Solar Panels that create electricity are just beyond the scope of a DIY project.

can anyone tell me how exactly a solar panel works, and what i would need if i was to make one myself? i have been looking at the option of running my house on solar power, but the panels themselves wolud cost over $5000. so surely there must be a way to do this myself cheaply.

I would wait for a few years at least before you do something like that. At the moment solar panel technology are making huge strides. Along with getting cheaper to manufacture and along with getting a lot more efficient in terms of how much electricity can be made per quantity of light.
http://www.energy.gov/news/4503.htm

Try this:

http://www.navitron.org.uk/eBay/65755.jpg

http://www.navitron.org.uk/solar_collector_panel.htm