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The following is a guest post from Speak.Thunder Films

How It All Began

When Christopher decided to buy a desolate piece of land in the Colorado mountains, he was hesitant to tell me at first.

It was a frigid day last February. I had sent him a short text message from work, “What are you doing?” and it took him a while to reply. “Nothing much. Work,” he said. And then, “Might go up to the mountains.”

It wasn’t until that evening when he told what he’d really been up. That he’d skipped work and called some mountain real estate agents on a whim, then drove up to meet one, and found a piece of land that seemed just right. There was a pause. He looked up towards the ceiling. “I put down an offer,” he said with a hopeful grin.

I didn’t have to ask why or what he would do with it. I knew this land was the most important piece of a dream he’d been constructing for years: a small cabin in the mountains, a porch with two rocking chairs, a pick-up truck, a dog, and possibly a banjo. It was just 4 months before his 30th birthday and this dream was starting to feel urgent. “If I don’t do it now, when will it happen?”

So maybe it surprised him when I matched his scheme with an even crazier notion.

“Let’s make a documentary film about it,” I said.

The Film

Nine months later, Christopher’s 130-square foot tiny house is half-way finished and our film is underway.

In addition to following Christopher’s attempt to build his own tiny house from scratch, teaching himself the necessary skills as he goes, we’ve also been interviewing other tiny house builders and dwellers across the country.

We’ve spoken with Jay Shafer in Sonoma County, with Karen Chapple, a professor of urban planning at Berkeley, who sees tiny houses as a solution for low-income housing in cities, and a wide spectrum of other tiny house owners, and people who have built homes with their own two hands.

We’re interested in questions about home and place: What makes us feel at home, and what makes a life full? We’re interested in the ways that other people have chosen to simplify their lives, paying attention to quality over quantity—and how these choices have helped to them to feel more satisfied, more at home.

Christopher’s tiny house project is as much about building a life for himself that feels right, as it is about learning how to frame or roof a house.

If you or someone you know lives in or has built a tiny house from scratch, shoot us an email and tell us about your story. We would love to meet you and hear about how you have made a home, and what makes your life well-lived.

If you’re interested in the project, you can follow us on facebook, visit our website.

The film is scheduled to be released in Spring of 2012. In the meantime, take a sneak peek at our teaser trailer:

TINY: A Story About Living Small (Teaser Trailer) from TINY on Vimeo.

Photo credit for “Window Tape” and “Roof Trim” is Kevin Hoth, “Christopher Merete Window” and “Behind the Scenes 1″ is Avy Harris, and “Behind the Scenes 1 & 2″ is Merete Mueller.

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The internet is brimming with cheap raw land for sale and many of the deals seem too good to be true. Land can also be very difficult to finance. This is because it’s difficult for lenders to really assess the true value of raw land because there are so many unknowns, making it nearly impossible to calculate the investment risk.

One increasingly popular way to buy land is through online land brokers. These companies buy and sell land and often provide financing. The benefit is that they make raw land easier to buy, often offering low monthly payments with no credit checks. Common sense tells us that there’s a greater need for due diligence when any deal sounds too good to be true.

Researching land developers

I recently had a dialog with the folks at Classic Country Land.  They have taken their real estate investment company to the next level, and have made the primary focus of their business developing larger tracts of land into accessible parcels.

Antler Ridge is one example of the kind of communities that Classic Country Land develops. This particular development is located in the south-east corner of Missouri on the border of the Mark Twain National Forest. It was once a much larger single tract of land and is now split into smaller parcels averaging 21 acres each. Each parcel appears to have deeded access by private dirt road and there is a county maintained road to the development.

They’ve also setup some high level covenants, but unlike many developers they don’t make it hard for folks to build something simple, small, and off-the-grid. For example, the Antler Ridge Covenants (pdf) defines a few limitations that are intended to keep neighbors from setting up something other than a place to live. This protects everyone that buys land there but doesn’t add so many restrictions that construction is prohibitive. Missouri is also well-known for flexible building laws, so a good choice for those looking to build alternative housing.

The following photos are from the Classic Country Land website and show what Antler Ridge looks like.

Doing your due diligence

When you discover a property you like online be sure to do some careful research on the parcel and seller. If the land is being sold by a developer check with the Better Business Bureau to see what kind of reports have been filed for the company. This can give you an idea of their track record; Classic Country Land has an A+ rating for example.

Also be sure to understand the terms of the sale and when you actually get the deed. Some seller financed agreements state that the seller holds the title until the property is paid in full; others put you on the title while you’re making payments like a traditional mortgage.

It’s possible that in the fine print you may find that defaulting on the loan causes the property to revert back to the seller. This would be bad, very bad, since you could loose any equity you’ve built-up. Read the fine print purchase agreements carefully.

If the seller offers financing be sure to review the loan terms carefully too. The folks at Classic Country Land have a strait-forward lending model. They will often discount the purchase price of the land if it’s a cash deal; and the bigger the down payment, the lower the interest rate you’ll pay.

Many of these seller financed land deals also do not require a credit check. This can be a bit of a double-edged sword because it’s the buyer’s responsibility to determine if they can really afford the loan. Many people want to think they can afford monthly payments on their dream property, but often fail to do their own due diligence on themselves. Try to avoid getting caught-up in the excitement and carefully consider all the risks before making the commitment.

The most important part of doing your due diligence may be getting out there and visiting the place in-person. Google Maps and other online research tools can give land shoppers a false sense of security that should really be tempered with a visit in the flesh.

Finding a good deal

If you were to buy land with cash from anyone you increase your chances of getting a good deal. It’s also a sure thing you’ll pay more when you choose a payment plan. But if you’re looking for low-cost, off-grid property to park a tiny house and don’t have the cash, paying the premium to have a place to live while making payments may be a good deal in the greater scheme of things.

Inexpensive land also comes with a natural built-in red flag, which is simply that it is inexpensive, there’s always a reason for that. In the case of Antler Ridge I suspect the low cost is due to it’s remote location, off-grid status, and dirt road access. If you plan to live their full-time and need a local job the cost of your commute may far outpace any savings on cheap land.

Good deals are really in the eye of the beholder. It’s only a good deal if it serves your needs and empowers you to reach your goals. Be patient and choose wisely and more often than not, you’ll be happy with the deals you negotiate.

Avoiding owners’ associations

In my humble opinion property and homeowner associations should be avoided, or at least well-researched before you put down your money. These organizations are setup to add another layer of governance to a community and might work well for those who want to live on the 18th hole, but for most of us they just add a major pain in the neck.

Wrapping up

Buying land is not easy and should be approached with lots of caution. It’s not rocket science either, so spend the time to educate yourself and connect with people who’ve done it. Here are a couple of posts I’ve enjoyed from people who’ve gone through the process.

If you have any personal experiences with buying raw land or doing business with land developers I’d love to hear about it in the comments. Thanks!

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My wife Julia ran across a post on craigslist.org for a piece of land out on the northern California coast. The seller is offering to carry $200,000 of the purchase price with a $60,000 down payment to give the buyer time to build and refinance.

“Ocean view building site, owner will carry – $260,000. With a $60,000 down payment, owner will finance this ocean view lot for a year or until your home has been built, whichever comes first. No monthly payments, zero interest added on to the principle…can’t get better than that! $60,000…lot is yours – just get your plans and build. Great opportunity for investors and contractors.”

If you’ve never looked for land before you may not know it’s really had to get loans on bare land. In fact there are few lenders willing to do it. When a seller offers to carry the loan and put you on the title you instantly get the most important part of getting a construction loan, the land. Other requirements are plans, a contractor, soil drainage tests, but the land is the first piece of the equation and often the hardest to get your foot in the door if you don’t have cash to buy the land. This one piece is the biggest impediment to building your own house.

In this example the seller has done a lot of the leg work, making it easier for a buyer to get approved for a construction loan. This is a huge benefit for the seller because it opens the land up to a wider group of buyers. The risk is relatively low especially if the seller stays on the title as a lien holder. If the buyer defaults on repaying the full purchase price the seller takes the land back.

If you’re looking for land don’t forget to ask the seller if they might be willing to carry the loan. But be sure to talk to a lender, contractor and real estate expert before entering into any deal like this. There is risk and these experts should be able to help you decide the best way to handle your specific situation. Photo credit Google Maps.

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