Tenant handles all utilities and lawncare.

Tenant pays all utils except water.  

So by utilizing leverage you earned $200 more.  

Is there a way to utilize part of my Traditional IRA funds as a down payment on a SFH investment property without being penalized?

Each are great strategies to access capital and each has its pros/cons for utilizing the strategy in the best way.

To minimize capital gains tax on the sale of their primary residence, your in-laws can utilize the $500,000 capital gains exclusion, potentially explore an installment sale to spread tax liability over several years, or consider converting the property into a rental to use a 1031 exchange for tax deferral eventually.

I'm passionate about real estate and how utilizing this asset class can enable me to build generational wealth and retire early.

And via the clustering we are utilizing green-space in a communal manner thus reducing foot-print of that BUT retaining such perception as each unit has walkout to what seems a BIG green space.

Another option would be to utilize a property manager to manage everything and keep a buffer between you and the tenants.

Personally, I'm in the growth phase so I'm still working to acquire more properties and utilize more leverage.