Terms Buyer Wants to Build a House

I have a perspective land buyer who wants to purchase my land on terms. They are asking if they can live in a container house or tiny home while paying for the land. I am hesitant to say yes to this. What are your thoughts? Pros, cons and suggestions are greatly appreciated.

@ivyrealtyland I’ve always disallowed this in my contracts, but that doesn’t mean it always needs to be a hard-and-fast rule for every situation.

It just adds some complexity to the deal when a borrower wants to do this, because this is a long-term relationship you’re getting into, and you’ll want to be sure they’re not going to devalue the property or turn it from an asset into a liability.

It might be worth asking them, if they have money to buy/build a tiny house or container home, why don’t they use that money to pay you off instead and get the loan on their improvements? Depending on what the improvements are, they might be able to get cheaper money with better terms that way.


@retipsterseth Thank you for your help Seth. I declined their offer while letting them know that I would be consider a lower cash payment. There are just too many potential legal issues for me and them that I don’t want to think about every day. One of the reasons I buy and sell vacant land is to avoid dealing with tenants, termites and toilets.

Cheers and Happy New Year! :smiley:


@ivyrealtyland a firm no. We keep occupied rentals/CFDs in another business structure

1 Like

@steveh Thank you. They called us today and we recommended that they buy a parcel of land outright so they can immediately start the process of getting a building permit for a home. They also wanted land with water access, which our land does not have. Ethics is the way to go.

Cheers to all!

1 Like