From the sentiment of your post it seems like you're viewing the buyers as strictly investors when they may lean more towards traditional homeowners looking for a quality of life improvement or an improvement on their current financial situation today.Let's say the buyer pays 465k and has a 5% interest rate.

I was planning on building the home in the traditional stick built style in my budget but am wondering if doing prefab may save some money/have other benefits.

The first misconception is that you can declare a property headed onto the market only S8 eligible, refusing to consider traditional applicants.

I would be amazed, shocked even, if a traditional financial institution was willing to lend on a non-habitable asset up to 80%. 

That can hurt your cash flow and could equate to the same as a traditional long term hold without the headache and management.I'm not saying don't do it, I'm saying you have to look at all options. 

Examples might include areas in the Midwest, Southeast, or Sunbelt regions.Multifamily Properties: Consider duplexes, triplexes, or small apartment buildings to increase unit count and spread risk across multiple tenants.Short-Term Rentals: If you’re comfortable with the management requirements, STRs in vacation or business travel markets can offer significantly higher cash flow potential than traditional rentals.Value-Add Properties: Look for opportunities to buy undervalued properties where you can force appreciation through renovations or better management.Decision FrameworkRun the Numbers: Compare the projected cash flow, equity growth, and tax implications of selling versus holding with a refinance or HELOC.

Buying properties through non traditional channels.  4.

Emphasize how this arrangement could work to their benefit, offering steady income, avoiding a traditional sale process, and giving them the freedom to move forward with their plans such as buying that sailboat and sailing around the world.If they ultimately decide they’re not interested in selling, you’re still in a great position to continue your search and buy your own property in the near future.

I have been trying to save up money but it is not near a down payment for a traditional loan.

This gives you a foundation for making a fair offer.Secure Financing: Be prepared to show you’re a serious buyer with funding lined up, whether through cash, traditional financing, or a creative option like seller financing.Have a Strategy for Repairs or Development: If the property is distressed, outline how you’ll handle improvements to bring it back to productive use.