Failed to create LXD data: /cache/overlay: is a directory

Greetings LXD fans.
I’m using the lxd_imagebuilder and running into a snag and can’t find any reference to it.

running:

sudo lxd-imagebuilder pack-lxd build.yaml rootfs-24.04 .build-files/out  --cache-dir .build-files/cache --debug --cleanup=false

I get the following error

INFO   [2025-09-11T04:58:47Z] Managing repositories
INFO   [2025-09-11T04:58:47Z] Running hooks                                 trigger=post-unpack
INFO   [2025-09-11T04:58:47Z] Managing packages
INFO   [2025-09-11T04:58:47Z] Running hooks                                 trigger=post-packages
INFO   [2025-09-11T04:58:47Z] Running generator                             generator=copy
INFO   [2025-09-11T04:58:47Z] Running generator                             generator=copy
INFO   [2025-09-11T04:58:47Z] Running generator                             generator=copy
INFO   [2025-09-11T04:58:47Z] Running generator                             generator=copy
INFO   [2025-09-11T04:58:47Z] Running generator                             generator=copy
INFO   [2025-09-11T04:58:47Z] Running generator                             generator=copy
INFO   [2025-09-11T04:58:47Z] Running generator                             generator=copy
INFO   [2025-09-11T04:58:47Z] Running generator                             generator=copy
INFO   [2025-09-11T04:58:47Z] Running generator                             generator=copy
INFO   [2025-09-11T04:58:47Z] Running generator                             generator=copy
INFO   [2025-09-11T04:58:47Z] Running generator                             generator=copy
INFO   [2025-09-11T04:58:47Z] Running generator                             generator=copy
INFO   [2025-09-11T04:58:47Z] Running generator                             generator=copy
INFO   [2025-09-11T04:58:47Z] Running generator                             generator=copy
INFO   [2025-09-11T04:58:47Z] Running generator                             generator=copy
INFO   [2025-09-11T04:58:47Z] Running generator                             generator=copy
INFO   [2025-09-11T04:58:47Z] Running generator                             generator=dump
INFO   [2025-09-11T04:58:47Z] Running generator                             generator=cloud-init
INFO   [2025-09-11T04:58:47Z] Running generator                             generator=cloud-init
INFO   [2025-09-11T04:58:47Z] Running generator                             generator=cloud-init
INFO   [2025-09-11T04:58:47Z] Running generator                             generator=cloud-init
INFO   [2025-09-11T04:58:47Z] Running generator                             generator=dump
INFO   [2025-09-11T04:58:47Z] Running generator                             generator=dump
Error: Failed to create LXD data: Failed to create file ".build-files/cache/overlay": open .build-files/cache/overlay: is a directory
ERROR  [2025-09-11T04:58:47Z] Failed running imagebuilder                   err="Failed to create LXD data: Failed to create file \".build-files/cache/overlay\": open .build-files/cache/overlay: is a directory"

I have tried with/out cleanup, cache-dir and not, and disable-overlay.
Its failing at the actual packaging phase, wish I could get more verboseness out. If you look at the cache dir there isn’t an overlay folder.

I extended the imagebuilder’s ubuntu example and just added a few files. I’m using a base rootfs that i created that installs a apt packages and updates.

Anyone else run into this overlay problem?