Mom's retirement money shouldn't be in real estate

Q. My family has owned a property for a few generations in the "hub" of a city. The house is ready to come down for sure. We are in the process of subdividing the lot into a smaller and a larger area. It is hopeful that it will be approved to build a single home on the smaller lot and a two-unit on the other lot.

My mother, who is 78 and in so-so health, has enough money to build these properties, but she is highly tempted to just sell the lots to a builder without any houses on them. I think it would bring in so much more money to build then sell, or even build then rent out for a few years. Which is a better investment? There are so many options my head is spinning.

A. You don't tell me who would supervise the building, which can be stressful and demanding. It's easy to make mistakes and get into trouble. And you don't tell me who would manage the properties while they are rented out. Being a landlord is also a skilled, time-consuming job.

If you are thinking of your mother doing those things, I'll tell you for sure that a reluctant 78-year-old amateur in so-so health shouldn't attempt any of it. Nor should she invest all her retirement capital into building at this time - or any time.

Q. How long must I leave my house for sale with one real estate person? I have had it listed for three months and haven't had one person look at it. I would like to change to someone who would actively market my house.

A. If your house has been entered in the local multiple listing system, and if there's been advertising in newspapers and on the Internet, then it has been marketed. If no one is interested after three months, my guess is that you've priced so high that buyers simply choose to look at other houses.

The listing contract you signed will tell how long you promised to stay with that brokerage. You always have the right to withdraw an agency, though that may involve some obligations. At any rate, you actually hired the company, not the individual agent. By all means, call the office and discuss your concerns with the managing broker.

Q. I bought a house in 2006, and this year I found a job in another city. So I relocated and bought a duplex, since it's cheaper than renting. But now I have to pay two mortgages. Should I sell my first house? Hold on to it by leasing, or keep it as sort of an investment? Is it a stupid idea to keep my first home even if nobody's living in it?

A. Yes.

Being an absentee landlord is asking for trouble. Paying the expenses on a vacant house makes no sense at all, and again, you're laying yourself open to all sorts of problems. Sell the first house. Put it in the hands of an agent who's active in that neighborhood, as promptly as possible, at a sensible price for a quick deal.

Q. My wife and I are 10 days away from closing on the sale of our current home and purchasing a new one. The problem is that repairs agreed to be done by the sellers are still not complete. A couple of these items are required for our loan to close. The original timeline to make the repairs was 15 days. It has now been 35 days, and the closing date is in doubt. What options do we as the buyers have moving forward?

A. If only the sellers are involved, sometimes you can close anyhow; the sellers could give you a credit for repairs you will later do yourselves. But when it's a matter of requirements for the mortgage loan, your lender is involved.

I haven't seen the contracts and don't know how much of that agreement was in writing. I don't know if you'd have a claim for damages because of the delay (losing a favorable interest rate, for instance). But it's time to call in a real estate lawyer, someone who might contact the bank on your behalf to see what can be arranged. Perhaps your attorney would want to send a stern lawyer's letter to the sellers. Sometimes that alone works wonders.

• Edith Lank will respond to any questions sent to her at 240 Hemingway Drive, Rochester, N.Y. 14620 (please include a stamped return envelope), or readers may e-mail her at ehlank@aol.com.

2009, Creators Syndicate Inc.