I had a friend a while ago who had the block of land with a shed fitted out to live in. To the best of my knowledge the house never got built. The last I spoke with her they had fitted the shed out more to fit the now 3 children they had had since moving into the shed.

I think the shed could work as long as you have a clear set of goals as far as when things will be built/ready.

However, hearing the difference between the 2 property's.... I think maybe your DH is right & the established house isn't the right choice for what you both want.

Maybe keep looking for something that has the things you want to build but has the older farm house you also want.