Possible to Build Home on a Lot My Sister Owns and Share?

[Zack Thiesen]

My sister recently purchased a home on a lot of acreage here in California. We are very close and she offered to let me build a small ADU/house on the lot. I'm in the process of selling a house and would have enough to build the building and other improvements like driveway, fencing etc. It's a tempting offer since the land would be free, more or less. I'd like to put all appropriate and very well-deserved warnings about getting into financial and RE dealings with family aside. That's something that, indeed, I am going to heavily weigh and consider. I'm strictly asking about the logistics of doing this.

My main question is: If I build a home on that lot, is there a way with a lawyer to isolate my share of the value? Is the only way to subdivide? If I wanted to sell when they did not, could I draft some contract with a RE lawyer that had them pay me out for my building and share of the parcel? It will be tough I think, since the added market value to the overall property will likely be less than what I will pay to build the property, but then again I'm not really looking for tit-for-tat value here. I likely will not sell for many years, during which time I hope there's enough appreciation to bridge that divide.