How would you like a part time job, working from home, which can earn you up to $125,000 per year? What if the part time job was in your ideal vacation spot or a shorter commute to your "real job"?

Sounds too good to be true! But it is! The 1997 Tax Act Internal Revenue code 121 provides a tax exemption of $250,000 for a single person and $500,000 per married couple filing joint returns upon selling their principal residence. You must live in the principal residence for 24 months during the prior 60 months before the sale.

If you only take the above facts at face value- you may stop reading. But add a little creativity and you may just find that this can boost your lifestyle.

There are many ways to be a real estate investor. Classically, buying and holding properties for rental. Many people do not want to have the burden of T&T (toilets and tenants), collecting rents etc.

Consider the relative advantage of being a "serial home buyer". No rent collection, no late night phone calls because the toilet is stuffed, no appearances in court for evicting a non-paying tenant, no complicated tax returns for depreciation etc.

What is a "serial home buyer" Simply put you buy a home, fix it and sell it in two years. You keep $500,000 profit. (married) or $250,000 profit (single) TAX FREE. There is no limit for the number of times you can claim the exemption. In fact, if you are required to move for job relocation or health reasons, you can claim the exemption prior to the 24 months. Better yet, you don't have to keep all those home improvement receipts or complete complicated tax forms.

By now, you have probably figured there is a catch. There is. Albeit, a small one. In order to make the largest profit in two years, you must buy a "fixer upper" and fix it...and here's the catch - live in it while you fix it.

Depending on your personality and life style, this may not be a problem. But if you can't stand a mess, living in a home while making improvements is very stressful. Likewise, if you entertain a lot, a construction zone is not conducive to elegant entertaining.

On the other hand, consider the following scenarios:

Jack and Diane are recently married and want to buy a home before they start their family. They locate a fixer upper and buy it. They move in and spend part time in the evenings and weekends doing the fix up. The sell it in two years, keep all of the profit, and buy a larger fixer upper to do it all over again.

Ted and Susan own a home in a prosperous suburb of New Jersey. In addition, they also own a small cottage at the Jersey shore. Ted retired this year while Susan cannot retire for two years. Both want to purchase an elegant water front retirement home in Florida when Susan retires. Ted and Susan can use the Tax Act of 1997 IRC 121 to get the exemption for both homes. If they sell the suburban home now they can keep $500,000 profit. Next, Ted moves to the home at the shore while Susan gets an apartment and visits the shore on the weekend. Ted lives at the shore for 2 years, sells it for up to $500,000 profit and they both retire to Florida and live happily ever after. (According to the code, to claim the $500,000 exemption, only one spouse must meet the ownership test if the other spouse meets the occupancy test.)

A similar example is Tom and Beth; a couple that remarry after each has divorced. Beth sells her house (she got it in the divorce) to move in with Tom. Two years latter, they sell Toms house and keep the profit on both.

Tina and Sean are expecting their first child. They purchase a fixer upper house. Tina decides to stay at home with the baby. She manages contractors doing improvements on the house. Two years latter, they sell the house and are able to buy a larger house with the profits. Tina is expecting again!

Larry and Joyce are retired. They purchase a resort property in Palm Beach and a resort property in Aspen. They rent the property in Aspen during ski season while living in Palm Beach. They spend summers in Aspen. Two years latter, they decide to move to Aspen and sell the Palm Beach property. Larry and Joyce claim the $500,000 exemption for the Palm Beach Property. Two years after moving to Aspen, they sell the Aspen property to move into a retirement village in Arizona. Larry and Joyce keep the $500,000 profit from the Aspen property, even though it was a rental investment property when they purchased it.

Steve and Sandy own a home in Princeton NJ and live there during the summer. In the winter, they spend six months in their home in Florida. They have been doing this for four years. They can now sell either home and qualify for the full tax exemption on the profit, even though the occupancy of each house was not continuous.

John is a contractor. He purchases a fixer upper. He rents the property to tenants with the understanding he or his sub-contractors will be making repairs and improvements. After one year, he is finished with the improvements. He can now do a tax-deferred exchange for another property, raise the rent for the improved property, or move into the property and convert it into his principal residence. If he sells the property after making it his residence, he can keep up to $250,000 profit. (Generally, an investment/rental property should be rented for 1 year before conversion to your personal residence. However, the IRS does not state a time period in the code.)

As you can see from the above examples, becoming a serial home seller can suit many age groups and life style segments, but it is not for everyone. It is ideally suited for the person who likes change and doesn't mind moving (i.e. travels light). It is especially good for the handy do it yourselfer. It is a good fit for the person who can tell the difference between a "money pit" and a gem in the rough.

NJPForeclosures.com is an ideal source for serial home sellers. Why? The first step is buying right.

The ideal candidate for a fixer upper is a house that can be purchased for 25% or more below the market value of comparable houses that are in "move in" condition. Homes, which are in foreclosure, are a good place to locate such candidates.

Many defendants in foreclosure need to sell the property quickly to avert the foreclosure. They are under stress from bill collectors. They are in a cash crunch and may not be able to afford minor improvements needed to effectively market their property.

If the foreclosure defendant lists the property with a Realtor, the typical buyer is looking for a "move in" condition home. The defendant may not be able to afford a coat of fresh paint, or he may be so despondent that he cannot motivate himself to apply the paint. The faucet in the kitchen has a drip. While it only takes a washer to fix, he hasn't cleaned the dishes for a week and it seems like too much trouble. The caulking around the tub is full of mildew, but spending and hour with some Ajax and bleach doesn't seem worth the trouble. The laundry is overflowing the basket, but he still has clothes to wear, so he will do it latter. The newspapers are piled on the floor, but he hasn't had time to tie them for recycling. The grass needs to be cut, but the lawnmower isn't working and he doesn't know how to fix it. The list can be continued, but you get the picture.

The real estate agent is not going to be able to sell this house to someone looking for "move in" condition. Perhaps it may only take a weekend to clean it up. Most buyers will not see it that way. Most buyers will over exaggerate the amount of work to fix because of the mess. Most buyers will assume that if the housekeeping is messy the maintenance on the house has not been kept up. Most buyer want to close, move and unpack. Call it a day!

But an NJPForeclosures.com reader knows better. If you are looking for a good deal, you must consider those homes the typical real estate buyer will over look. If you want to be a serial homebuyer you are looking for the homes with the largest profit potential with the least amount of work. A fixer upper but not a money pit. Learn to tell the difference!