Water or any other liquid level sensors can be handy around a house. It can be used to monitor a water tank level in a greenhouse or in other areas where liquid level has to be known. The idea is pretty simple – measure a capacitance charge between two metal plates/foils, which varies due liquid level change between them. Of course container has to be non metal.
Probably most important part is to read capacitance. For this there is a handy Arduino Capacitive Sensing Library ready for you. To measure capacitance is to measure capacitors charge/discharge time through resistor. Don’t expect great precision with such materials used, but still this is a fun project to try out.