I have a 5 year balloon on owner financed land. What to do?

[Jeremy Bourgeois]

(Heber City, UT)

I bought a few acres of land in Heber City, Utah a few months ago slightly below market value on seller financing. Terms:

$160,000 purchase price

10% down payment

3% interest

Balloon payment in 5 years

My plan was to just make the payments on the land for the next 3-4 years, ride the appreciation wave and sell the land in the same condition. For context, land here has gone up 4x in value over the past 4 years and continues to increase as the city sees more development. The only thing I could do with the land is build a house there. Zoning would not allow for anything else, and it wouldn't make sense to try. 

The other option was to partner with a builder on a new construction home. New houses there are going between $700k-$2 million.

Worst case scenario, I know the sellers pretty well. If 5 years hit and I still had the property, I'm fairly confident I could negotiate an extension with them. Any other thoughts or ideas for this situation? Is it a stupid buy? Would love to hear from anyone who has done something similar.