A pie chart of retirement investment diversification changes over time from young investor to old investor - but the change is typically shown as a shift from aggressive mutual funds to more bonds or less aggressive.  

Hi Derek,Cashflow positive real estate will help your ability to qualify for a primary residence mortgage, not hinder, assuming an REI-friendly lender, and that you maintain adequate PITI reserves (if you have healthy retirement accounts, that'll typically do it). 

I want to leverage as much of the funds in these 2 retirement accounts as possible. 

If that's where you want to live, stay, retire and the ROI metrics are anywhere close to what you want: buy there.  

I thought I could take a loan against the 401k or transfer one of my old retirement accounts with a previous employer to a self-directed one so that the entire purchase and proceeds are all handled within the retirement account and thus would not count as income for tax purposes.Thanks all!

If so, waiting for an exit until post-retirement (i.e. banking on long-term appreciation) is a completely viable strategy.  

Retired and mobility impaired would have been a more accurate description.I don't think we'd take any legal action yet, but I will tell my sister to not enter the house if he isn't fully clothed.

@Helen Zhang I'm a newbie to real estate, but I've done my homework on retirement accounts.

Now that same family member owns half a dozen houses of his own and is enjoying a much better retirement because of it.Point is, maybe you just need to "show" them how you can make money as opposed to "telling" them.Or, maybe help educate them on what exactly you want to do. 

Also taking into account locations where future and realistic market tailwinds (e.i retiring baby boomers and foreign investors) lead.