Buying a piece of land with the parents - Will that work out well?

My uncle lives on my grandparents' property. From what I can see, it's working out well. My mother (and me too) would never want to build there for anything in the world. I adore my grandparents, but there it’s all about joint management of the property. So no “my part, your part.” My best friend basically lived with her parents and grandparents in one house. That seemed to work really well. I would never voluntarily want to build next to my parents/in-laws. Yes, the babysitting factor shouldn't be underestimated. But that only makes things comfortable for the first 10 years. After that, it decreases drastically and you might end up sitting with grumpy senile old people. Especially since you have no idea how direct coexistence with them works, I would personally advise against it.

My mother-in-law lives next door. That means: The two properties are right next to each other, roughly forming a triangle. Her house is in one corner, ours in the other. Between them are her garage, fence, and the shed (very practical: it’s just a shed standing on the property boundary – the fence basically runs right through it). Behind that is the vegetable garden, open and without a fence.
That works well. Everyone has their own terrace/garden that can’t be seen into. My mother-in-law is retired and likes to help in the garden, passionately pulling weeds, helping us with renovations. Okay, she also drives us a little crazy sometimes with her tidying craze ^^ (favorite hobby: collecting buckets and hoarding them in the attic).
And one more thing: She does have a key to our house for emergencies (we also have one for hers), but she would NEVER misuse it. She never just comes into the house unannounced or stands at the door wanting to come in for coffee, etc. I find that very important.
But I think the most important thing is really the relationship with each other. It wouldn’t work with my parents – they would hang around with us all day. But my mother-in-law has her own life, her friends, her clubs, her hobbies – she doesn’t have enough time to constantly bother us :) How it will be if she ever needs care isn’t certain yet. But I am sure we will manage that too.

I would suggest spending the next two-week vacation together with your partner at your parents' place. There you might already notice clues about whether everyone needs to have breakfast at 8 every day, if there might be tears when you prefer to have brunch just as a couple, etc.

We didn't do it now. We'd rather look for something of our own.

Understood. You did nothing wrong (which does not mean it was the right decision).