pgplsql SELECT INTO ... FOR UPDATE (transaction/locking question)

I'm trying to write a stored procedure in plpgsql that selects a row
and possibly increments one of its fields. I thought I would do SELECT
INTO my_record * FROM my_table FOR UPDATE WHERE ..., but apparently
plpgsql doesn't like the FOR UPDATE in a stored procedure. Does plpgsql
automatically lock any rows I read until the stored procedure exits?
I'm just not sure how to get the functionality I'm looking for and not
have to concern myself with concurrency.

Example:
create table t_test (x int, y int);
create or replace function f_test(int) returns void as '
declare r record;
begin
select into r *, oid from t_test -- FOR UPDATE
where x = $1;
if found then
update t_test set y=y+1 where oid = r.oid;
end if;
return;
end' language plpgsql;
insert into t_test values (1,1);
select f_test(1);