Conflicted Need advice

[Robert Willard]

I have been lurking here for several years.  I have been wanting to create an additional revenue stream for my wife and I.  I believe it would get us a step closer to financial freedom.  I would love to be able to travel while I am young enough to enjoy it.  We have a good size 401k largely from a ESOP buyout.  We also have additional money in a subsequent KSOP investment with the new owner.  The issue with both is liquidity.  The other issue is the 401k is reliant on the stock market which has not been good the past 18 months.  This has me wanting to diversify so we are not so dependent on the market.    

Obviously, I do not want to make a bad investment.  We could sit and do nothing.  Ride the roller coaster that is the stock market and end up with a nice retirement in 7-12 years.  Still, there is something in me that does not want to be complacent.  I do not like that we are almost 100% reliant on the market.  Retiring earlier is very attractive.

I feel like everyone here at one time had similar concerns.  Buying the first investment property is always a leap of faith.  How do you weigh taking on such a large liability that puts your family's well-being at risk?   

To make matters worse is the real estate market is still hot.  Prices have receded but are still on the high end.  It is not a buyers market.  

I am interested to see what people think.  Should we take the leap?  Is it a bad time to buy?  I really do not think the housing market is going to drop, unless you see unemployment take a steep drop.  Inventory is low and will likely stay low for the next 6 months+