Originally posted by Jon Holdman:
Where in CA?
How old are you? The advice below assume you're an adult. The situation is very different if you're 16.
Does the house have a mortgage? What's the balance? What's it worth?
First, sell the house. Split the proceeds three ways and move on. Unlikely you're going to generate enough cash flow after taxes for three of you to live off of. Impossible if there a loan on it. If there's a loan, its very likely you will lose money each month, and you don't sound like you're in a position to carry a property. Yes, I know prices are down. If you're in LA or SF, they're going down further. You got it for free, and won't pay any taxes if you sell now, so sell it and move on.
Second, get a good job. I'm making a gross and entirely unjustified assumption you can't support yourself based on the fact you're living with your mom. If you don't have the skills for a good job, use that inheritance to go to college or a trade school so you can. You have to support yourself now. That $100K will go through your hands like sand unless you take steps to support yourself on your own income.
Third, find a decent but cheap place and rent. Right now you don't really know what to do with your life, and you don't want to get locked into a property. Figure out what you want or need to do first, then consider buying.
Thanks for the response! Answers provided below:
1) I am 25 years old, soon to turn 26, and live in Southern California (LA area)
2) About $500,000 and no mortgage. It's already paid off. Reason why we are going to rent it.
3) You advise to sell, but I hear selling is bad. It's a good time to buy and a bad time to sell. So, I question your own advice.
4) I am college educated, have a steady and stable job, and have a good income.
5) I believe I would receive about $500 a month for renting the house. Then, when it's a good time to sell we can sell the house.
You may be asking why I was living with my mom? Well, why get my own place if I had my own room and everything at home with my mom, had a good relationship with her, and things were just going well? I was able to keep more money, which I saved, and now am in a good position to do something with it. On top of that, I will be receiving inheritance money from her (which is painful for me as I have been going through a lot in turns of emotions ...etc).
I wouldn't say I 'need' a house. But, I hear it's a good time to buy. Being that I haven't lived on my own (except for college for a few years) I am not sure about what roads to go down:
1) Pay rent at an apartment? What are the pro's and con's?
2) Buy a condominium? What are the pro's and con's?
3) Look into a townhouse?
4) Buy a house, pay mortgage on it, and when things get better I can then sell the house.
The goal is to use my money wisely and not blow it; hence my questions.
Jason
