We are building our retirement home 1800 sq. ft. an live 8 hrs, away from the property. There is an "old" mobile home on the property that we live in when visiting the property. We started building in January and my husband, who is retired, has been there the entire time living in the mobile home. Living close by has worked out great. He knows exactly what is going on each day and stays in close contact with our GC. There is no way we could have built a house and not lived there or at least been close by. There are too many decisions that need to be made when building a house and our house is small. I will be going back in one week and hope to stay for a month. We are hoping for a completion the beginning of May.

Make sure to also check into how the financing would work under such an arrangement.

How long do you plan to live in your new home? If all of your neighbors live in double wides or small homes in poor condition then you will not be able to resell your new home for close to what you paid for it should you need to sell.

Maybe I am wrong, but I don't see your value here. It seems to me you are wanting to build a house because you can't really afford houses in the area you want to be in. I am building a house for a few reasons but, it being cheaper is not one of them. I don't see you having enough room left over to actually build the house.

You say that the lots are "as low as $170k," leaving you only $230k to be back to the $400k price range. You can do it probably but I think you will end up so close to the $400k price you are trying to stay under that you will find it is just not worth the stress you have put yourself through.

In my area, banks set a limit on the value of the "lot" compared to the house, I remember it being pretty low like 30%ish (I don't remember the exact numbers and I imagine they vary with location.) Of course, you can pay more for a lot but only so much of the lot equity can be used as down payment on the construction loan.

bry, in the area I'm building in, the land is around half the cost of the houses. But you do have a point. A lot of people here think "the new houses are $1m+, but the old, small houses are only $500k. I'll buy a $500k house, tear it down and build a new one for $200k and have a $1m house for only $700k!!" But in reality, it costs at least $500k here to build a custom, one off house. So unless there's something about the existing houses that doesn't work for you (in my case, wasted space in the house, and too small garage is the standard model), then you may as well just buy an existing house.

And we weren't allowed to finance the whole value of the land, or even as much as we could have done on a house. The rules have been changing a lot lately, but I think you can mortgage 80% of the value of a house, but only 60% of bare land?

But on the other hand, you can buy a small, old house for only $500k. If you can handle living there for a number of years while you pay it off, you're at least in the neighbourhood without the $1m+ mortgage. When you go to build, you can leverage the paid off land, and then only have the mortgage of the house itself. Or, you build slowly, as you can afford to. Do the foundation, pay it off and then do the framing. That may not be allowed in certain areas, but then, living in a trailer might also not be allowed, so it all depends on local zoning. Or, live in the old house until you have a lot of equity, and then sell it and buy the bigger, newer house in the neighbourhood.

This will be our last home. No resell. The area is a real mix of homes. Double wides, old farmhouses falling apart, old farmhouses well taken care of, new builds peppering the landscape. All on 3 + acres.

Thank you for your feedback and info. Both FIL and my Dad work in zoning locally so I am sure to get all appropriate navigation feedback beforehand about what we would be able to do.

Your info helps me know what to bring to the table in regards to hiring a realtor.

I can handle spending $400k on a home if it's what I desire in the end. We tend to move slow and deliberately in our major purchases and have explained that this would not be a deal where we move into a smaller existing home and immediately start to build. We will have to wait.

Right off the bat I would also be looking at the end in regards to could we rent the home out that we lived in during the new home build in once we move into the new build?

I really appreciate what you've brought to the table for me!

We have rebuilt our house (complete gut and reclad) and we added an addition. Our family of 6 has lived it the whole time (quite nasty at times, but we are surviving). We had no issues with occupancy with the City, as we owned the house prior to the rebuild/addition. Of course, our plan of action was expensive. My sister bought a second hand trailer and lived on her site with a Port a Potty on site while she built her home. Again no issues. I believe they re-sold the trailer afterwards. It would have been tougher if she had had kids.

We purchased land (just under 4 acres) with an ugly mobile home (fortunately tucked under a lodgepole overhead structure) with plans on building. Due to life's twists and turns, our building project took longer than expected, but our little house (a cabin-cottage hybrid also known as The Cabbage) is nearly complete. In addition to living onsite during construction, I am self-employed and work as a graphic designer/illustrator from my home studio, so I have lived this project 24/7 for the past few months. Being a bit of a control freak, I am very happy to have been here to answer questions, clarify a few issues and correct problems before going very far.

A couple of things to keep in mind:

Although we had already been living in the lovely (not) tin cabin, our county required us to pay for a permit to have a second home on the property during construction. This struck us as pure greed and we considered fighting it, but finally shut up and signed the check.

Insurance took a bit of finagling and two separate policies. Our existing home owners' and auto insurance company wouldn't do builder's risk. Another company did not like the mobile home. Others disliked the horses (you know, the vicious miniature kind!) or our proximity to the forest. The first broker gave up, but the next one found the answer within minutes...

I don't know if all builders are like this, but ours had a difficult time accepting that, while this is a building site, it is also our home. We have horses, chickens and dogs. The property is fenced with a driveway gate which our GC wanted kept open at all hours. Not gonna happen. We finally agreed upon 7:30-5 M-F, with weekends by request. Despite a sign on the gate saying DO NOT OPEN GATE and our phone #, we've had workers come in unannounced on the weekend and leave the gate wide open.

This may seem obvious, but make sure any children and pets are indoors, off-site or secured well away from any workers or vehicles. Keep a close eye on any outdoor animals -- the drywallers dumped joint compound where it could run into our chicken run. Really? Glad I caught that one in time! On the other hand, one of our miniature horses has a thing for construction workers and -- she whinnies at them constantly!

If it can be broken, it will be. One of the big trucks slammed into our driveway gate, bending a hinge. Plants well away from the building site have been squashed. One group of subs used our hose, left it running, then drove over it when leaving, puncturing it.

We've made a point not to leave any tools within sight -- I don't want to think anyone would deliberately take anything, but it's so easy to borrow that shovel and then toss it in the truck without thinking. Better to keep your stuff out of sight.

That said, the good has far outweighed the bad, and I've really enjoyed talking with the different workers. I've provided home-baked cookies every day and made an effort to know everyone's name -- hopefully they think of us as more than an address and a day's work. My husband is a bit jealous that he has missed out on so much -- I can't imagine not having been here to see every step of the process.

Thank you so very much for your feedback! I feel fortunate that I've lived a life growing up in a family that worked FT in addition to restoring old homes while we lived in them. i.e.: I see the forest through the trees! Luckily between both of our families having architects, working w/ builders regularly and being very knowledgeable about local zoning, we have lived through and witnessed lots of building, subdivision of land and restoration. The only thing that nobody has done yet was buy and live on site while a new build started some time down the road. Getting ready to look for a realtor in the near future for current home and if the the buy of the Grandmothers old home falls through I want to be able to tell the realtor exactly what we want to do next. Again - thanks so much! Have a great day!

Hi the_foxes_pad...I am so excited to have come across your post...i was jus discussing this same idea with DH 2 days ago & wanted to know how you are doing thus far? Have you been living on your land while building other home? would love to hear advice, updates & etc ;-)