Is there any way for one Arduino board to communicate with multiple sensors? Say a home IoT application to monitor water levels in basement at 4 or 5 different places and transmit that data back to a single Arduino board to be then interfaced with a GUI to do home monitoring?
Yes you can ... however, how you transmit the sensor data? If wireless, you need some RF communication, and possibly a microcontroller like Arduino (or ESP) within each sensor module.

With nRF24L01 (2.4GHz) you can use 6 'slaves' (sensor modules in your case) to send data to the master (monitoring module).

Do things one by one: 


First make one sensor module
Than make the master to receive data
Than make the GUI screen
Than make the other five sensor modules