Personally, I lean toward selling and using the equity you pull out to buy a rental property or something like that.

Your basically cross-collateralizing the purchase of the land with your home, and then using the "free and clear" land as your equity down for the construction loan.

I have 100% equity in a single-family rental outside of Detroit Michigan.

This way before you even acquire your property you already will have a general idea of who you will need to make relationships and how you will need to position yourself to see success. 

KCCH provides unique opportunities for small-balance investors to access exclusive offerings in the burgeoning South Florida residential real estate market through private capital equity partnerships.

How is required capital to buy & maintain a property positively affected by S8 program? 

@Caroline KnightI don't know the Chicago market but I'm highly supportive of house hacking.One thing to remember that positive cash flow isn't actually the goal of a house hack. 

The lender must review and approve the renovations in advance, and must inspect the completion of all items that cost more than $5,000.A borrower may request reimbursement for their payments for the cost of materials or for the cost of properly documented contract labor, but not for the cost of their sweat equity (labor).

My book does go into detail on these as they are the biggest potential issues.  2)  The seller changes their mind before you purchase -  my book goes into detail on this but it is important you file what is called a memorandum of lease option - so they can't sell it to anyone else or refinance it to pull out their equity. 

Do the calculation for return on equity.