Here are some thoughts on your choices:401k Loan: This can be a good option since you're borrowing from yourself, but it comes with repayment risk, especially if you leave your job.

Whether that is staying in the family business or doing something else.

We want to do this transaction so we can upgrade our living space, have another rental (our existing house), and eventually rent out the new house (his house) after we grow out of it.

I find myself enchanted by short clips of deal analysis (SFH though MFH also works).Do you know where I can find channels of youtube doing it?

I know people who do this and I do not believe there are issues with it, but speak to an attorney and they should probably notify the company if they are an employee of that company that they are doing this.

@Jonathan B.Assuming you pass the "material participation" test for 2023 and did not use the property yourself (or used very little), you should be able to treat it as an STR for 2023, including bonus depreciation.  

I’m buying to improve the property, listing, service, etc so i do it right away.

It has been running for 22 years.

It may seem trivial for $3-4K/yr, but just consider it as a necessary action to be able to sell one day, otherwise you're likely to be in a serious bind later. 

I have only been doing this for 5 years but what I have learnt is that it takes money to make money.