Almost 70% of millennials regret buying their homes.

Is there ever a time when tapping retirement accounts makes sense? This is my plan (and I’ll probably stick with it unless there’s a ginormous negative I haven’t foreseen):

  • Buy property in Hawaii for $140k, build 500-600 square foot home on it for another $180k. Will have additional 300 square feet of covered screened porch for living space. Want to live on it permanently, but will rent it out if I have to leave; can sell for $500k immediately after building if necessary as lower cost homes (sub-$700k) are nearly impossible to find.
  • Finance it with $200k loan, $100k from retirement. Will have $20k left in retirement plus husband’s untouched 401k. Plus husband’s pension from new job and whatever new 401k I start in 2 years when I go back to work for an additional 25-30 years.
  • Monthly payments will be about $1500/mo. after accounting for taxes and insurance. Comfortable cost that’s less than average rental cost by $300+ per month for same amount of space. Plus it will feel like pennies when I go back to work and we’re a dual income family again.

The people that can’t make it work financially in Hawaii are not the homeowners, they’re the people getting priced out of condos because they raise monthly fees for amenities/repairs and they’re renters who see their monthly rent going up $150+/month every time their lease renews on top of the already astronomical rent prices. Have talked to realtors and builders already and have a loan fully approved to start the process, and have been told we can make this happen in my budget.

What is it that I’m not seeing? Why is this a bad idea? Or is it only a bad idea for people who are not guaranteed substantial profits if they have to sell?

/r/personalfinance Thread