This is my circumstance… I own the lot free and clear.

Unfortunately, due to a few different circumstances, the target closing date was not met and the seller chose not to proceed with selling the home to me.

It sounds like you have followed procedure as best as possible under the circumstances. 

The groups were mostly students, and a womens sober living home.

Please consult the tax professional who is going to represent you in the case of an audit before filing your taxes as your circumstances may vary. 

Not easy, but by no means rare, and she might be justly proud of dealing…can you see how your approach would read poorly in those circumstances?

I imagine that most people will stay put for a bit longer unless they absolutely have to move for circumstances that are beyond their control.

*Not a CPA*Depending on circumstances, gain of up to $250,000/$500,000 can be excluded under IRC §121.

My question, in a nutshell, "What do I do with the $45,000 (70% of total equity) bestowed upon me by the circumstances of my booming housing market?".

Having said all of that and working with hundreds of investors I would ask the builder who they are already work with - lending for new construction tends to require the lender to approve the builder and the borrower in some circumstances.