Expert: Jessica Bryan - 7/30/2009

Question
Dear Expert

    I never owned property before. I just have been using master card for over 15 years. I know I have good credit because I was never negligent on paying my bills or my monthly rent checks, and I never had any debt problems because I am a money saver. I do not know my credit score, for I never applied to purchase any house or property before. My present employer had to check my credit in order to grant me my clearance to work overseas, which I was qualified to receive. If I buy something, I will be first time property buyer. At this time I am working overseas.  I do not know when I am going back to the states because it is up to the company that I work for, but I can have up to 2 weeks vacation time every year, so I can make a trip for one week or two to visit every year.

    I am financial security seeker, who likes to plan to build a solid financial future. When I return home , I will be going back to my mother's house. Before or after my arrival to the states, I will need to embark on something different to start moving forward and get settled. I will need to do something that can provide me with stable income, but I do not feel comfortable to buy property.  My mother bought a ranch house 15 years ago for $144,000. She spent another $12,000 for remodeling and she was trying to sell this house for the past 8 years, but she still cannot get any buyers even after reducing her original price to $120 thousand.

    I like to relocate and pay monthly rents for an apartment; however, if my project can generate nice profit, I might consider doing one of the following ideas if it can guarantee a successful and stable monthly income profit:   

    Renting or buying a ranch house and finding some roommates who can help me with expenses, or getting a duplex home and living in first floor while putting other tenants upstairs, so I can receive monthly rent from them, or buying a property and putting it under section 8, or condo. I also like to invest in real estate and stock market, but I do not have any experience in all of these projects.

Do you recommend that I stay in apartment, or do one of the ideas above?
What is your suggested pricing, location, and condition?
Is there will be a big difference whether I start the project next year versus if I start it 2 or 3 or 5 years from now?
If I purchase my property anytime, do I will still be qualified for $ 8000 tax credit? What are the income restrictions for this plan?
Do you suggest any books to buy from Amazon.com?

Thanks for being a volunteer to help.

Answer
Dear Sam;
First, let me say that there are restrictions to the first time buyer program and you must complete the purchase before December (which gives you  little time).  I suggest strongly that you speak with a local agent familiar with the area in which you would like to purchase a home to find out about investment properties, rentals, etc.  I definitely think that purchasing a home now is a very good idea since interest rates are extremely low and prices are also low.  It is seldom that you have that combination.  TAKE ADVANTAGE!!! As for being a little reluctant because of your mother's history with being unable to sell a home; I would think that in 8 yrs time she must have learned something about why her home isn't selling.  She may have a functionally obsolete home or its location is undesirable, or...???  Has she discussed this with a real estate agent?  My point is that real estate agents see lots of homes and know the market.  It is always a good idea to consult with one before and during making a large financial decision such as buying a home.  They can help tremendously.  Don't try to do this on your own.  

As for pricing, location and condition; again, consulting a local agent you will be able to determine availability and investment potential.Call a large brokerage in the area and ask for the manager to recommend an expert in first time home buyers and/or investment property.  You will not need to read books if you research on the Internet.  There is a good deal of starting information.  Then, speak with an agent.  One or two book will not be enough information to give you the education that a real estate agent possesses.

Good luck and best wishes,
Jessica Bryan