There are lots of ways to withdrawal funds from retirement accounts prior to retirement (Roth contributions any time, 72t distributions, Roth conversion ladder during early retirement, or simply pay the 10% penalty).Any advice beyond this point would require knowledge on the size and composition of your your traditional 401k and your personal tax situation.  

Sounds Like a Good Deal to me.The Agent Replied to me to have a Conversation.

Your state may not even allow conversion of deposits to rents, but even if it does, I would NOT do it.  

@Joas Espinoza, having an ADU is a form of house hack and is a great way to start your Real Estate journey.What we typically do is finishing a basement or a garage then rent them out to offset the mortgage payment.I did ADUs conversions and will be happy to chat more about that.

It's highly unlikely they'll be able to do the conversion, but if they did, they'd be required to get a variance. 

You can't control where you live if you're there for a W-2 and need the job, so you can't influence "how much you should pay" as much as you can influence your cash flow.Anywhere you live, if you can find a fixer-upper off market, the entire conversation changes.

If you're already in conversation with him, and it sounds like you are, it's not a huge deal. 

We are budgeting another $50,000.00 for the garage conversion and another $5,000 in city fees.  

Was considering the pros and cons of a carport conversion into another bedroom to rent out.

I don't think there's anything I can do 6X my conversion rate.