By: Mowdee

Here's how to find out the price per square foot of a home:

Value of home:  $160,000

Square Feet:  2,130 Sq. Ft.

(divide the two): $160,000 / 2,130 Sq. Ft = 75.12

Price Per Square Foot: $75.12

So how do you know if it's a good deal or not? 

You would need to do a little bit of research-ask for past year's (5-10 years) prices of homes in your area.  Your real estate agent can do this for you (if he doesn't know ask him to get it from his title company). 

To give you an example, I did a quick research on the last thirteen years in the Reno, NV area (I got the raw numbers from the Reno Bureau of Business & Economic Research).

This is what I got...

Reno Average Sales Price Per Square Foot:

1993:  $78 / Sq. Ft.

1994:  $83 / Sq. Ft.

1995:  $87 / Sq. Ft.

1996:  $88 / Sq. Ft.

1997:  $90 / Sq. Ft.

1998:  $93 / Sq. Ft.

1999:  $94 / Sq. Ft.

2000:  $98 / Sq. Ft.

2001:  $104 / Sq. Ft.

2002:  $117 / Sq. Ft.

2003:  $136 / Sq. Ft.

2004:  $178 / Sq. Ft.

2005:  $217 / Sq. Ft.

Basing it from this graph, I would be getting a heck of a deal for the home I computed for earlier in this article ($160,000 / 2,130 = $75.12 Sq. Ft)-- I would be getting this home at 1993 prices!! 

This is a real example by the way.  My client was looking at this home last week.  This gave him a good idea where he stands on the property (he plans on selling it after five years). 

If you do this basic research you will  better see of how good (or not) of an investment you're getting.

Hope it helped!

“Advertising people who ignore research are as dangerous as generals who ignore decodes of enemy signals.”

                                                             -David Ogilvy, "pope of advertising"

By: Joe Salcedo of Reno Real Estate Blog

Understanding your market can put you ahead not by $4,000 or $4,000 or even $140,000 but as much as $155,000. Or if you choose not to heed, pick $155,000 from your pocket.

My client April (not her real name) was strongly advised (with graphs to show her) to sell her house in August of 2007. She waited till the market got better. We could have sold it at $305,000.

Demand

Median Price (2 years)

Now, it's worth $150,00.

Like a lone voice in the wilderness crying “look at the market... market... market” My cries have been largely ignored. “Location, Location, Location” is what they throw back at me. I don't argue, but a half-truth often carries the impact of a full blown lie.

Open the television, browse the news--there is someone bound to tell us about the real estate market. He's usually with the shiny head, a blue suit and an equally shiny red tie with thirty minutes worth of opinion--either watered down or hopelessly stuck in the latest breaking news in the housing market. 

The result: people seeing from the wrong end of the telescope—the here and now versus understanding the big picture.

The solution: know the supply & demand and median price. I promise you, you will understand the market better than the 90% of the 'experts'.

How: 1) Google it. e.g "Reno real estate number of homes for sale" or "Reno homes supply and demand"

        2) Your agent might not be able to provide you a graph like the ones you saw earlier (I was 'forced' to do this for my blog).  But ask your agent to pull up numbers--supply & demand and median price (at least two years).  Spend an hour to find out how the market is behaving.  You will enjoy it because you will proft greatly from it.

        3) Demand it from your agent's title company.  Ask questions.  Be inquisitive.

“Confront the brutal facts but never lose hope that in the end you wil prevail.”

                                                                  -Jim Stockdale, POW in Vietnam for eight years

*Joe Salcedo is a real estate agent in Reno.  You can find him at Reno real estate blog.

  Super photo by: PauloElias By: Joe Salcedo, Reno Real Estate Blog

1. Relying on The News for Direction

If you want to know the latest about Levi whatshisname and Bristol Palin. News is the way to go.

Mainstream media are helpful for many things--what's happening in your community, events shaking the world, who's hot  who's not or if you want to know if it's going to be sunny tomorrow.

They are not to be relied upon for real estate advice.

I have observed this trend for the last five years. Back In late 2005, I don't remember anyone in the big news centers talking about the falling existing home sales. If they mentioned it, they never got their hands dirty. Nobody wanted to be a 'gloom and doomer' and hurt anybody's feelings.

This continued until the first quarter of 2007. Perhaps the reason why they haven't been effective is they rarely do their own in-depth research. Instead they call industry experts (cnbc seems to like this setup), usually a broker or an owner of a company in the industry and asks for their feedback--that's the equivalent of asking your barber if you need a haircut.

What You Can Do: Talk to your local university real estate research guy. You can find his name through the small business development center. If in Reno, call the center for Regional Studies, University of Nevada Reno (775) 784-1771 or Email: nsbdc@unr.nevada.edu.

Or you can google e.g 'San Francisco Supply and Demand', ' San Francisco median home price'.  Find a local expert.  And make sure he is one.

”You cannot give what you don't have” my mother used to say.

2. Looking at Homes Before Getting Pre-Approved. Test-driving the Mercedes

...when you were in the market for a corolla.

Car dealers practice this. Realtors shouldn't.

Avoid looking at houses if you haven't been pre-approved. This will help you in two ways: You'll know what you can afford. Perhaps you thought you can only buy a $150,000 home when in reality you can go up as much as $180,000. Usually, it's the other way around. You will save your wife a lot of time and heartache by looking at homes close to what you were approved for.

What You Can Do: As a rule of grandma's thumb when buying something—conservative is usually better. And it's very hard, I know, believe me I've been there. Especially if the numbers say you can 'afford' it.

"We are consumed by desires to buy things we don't need, with money we don't have, to impress people we don't like" 

                                                                                         - Patrick Morley

3. Listening To Rich Dad--only

Ladies and gentlemen thank you very much for reading. Have a good day.  and the preacher is left with empty chairs.

'I had two fathers, a rich one and a poor one...' this is how the New York Times Bestseller for 260 weeks starts.

Like many, I read his book seven years ago. Call me corny but I was a fan of Robert Kiyosaki's preachings. 

Scores of people devoured Rich Dad Poor Dad and even before turning page 206 was on their way to buying two homes for 'cashflow' to retire by the time they turn 45. Don't laugh, because that is exactly what happened to thousands of would-be investors. Including the author of this article.

The good: opened my eyes to the rat race. The idea of buying income generating assets, Not liabilities ('doodads', e.g boats). Tax avoidance vs. tax evasion. Robert's crusade for financial literacy in our schools. Good storytelling.

The bad: Focused too much on borrowed money--“other people's money”. Made investing in real estate sound too deceptively easy. Does not give a complete picture in his investment strategies--makes it sound overly simple. To be fair, his other books tell more about pitfalls and specific strategies (but I wonder how many people go on to read the other books after being divinely inspired by the first?).

But I have to say that he was one of the three people who warned me about the incoming real estate crash way back in early 2006.

Conclusion: Read it to be encouraged. But know this is just the beginning.

What You Can Do: Get investment advice from the left (wise, successful and old people--grandparents, friends etc.) and to the right (Kiyosaki etc., avoid Mr. Trump though).

'Make everything as simple as possible, but not simpler'

                                                     -Albert Einstein

4. Being Clueless On the Market

Understanding your market can put you ahead not by $4,000 or $45,000 or even $100,000 but as much as $155,000.  Or if you choose not to heed, pick $155,000 from your pocket. 

My client April (not her real name) was strongly advised (with graphs to show her) to sell her house in August of 2007.  She waited till the market got 'better'.  We could have sold it at $305,000.  Now, it's worth $150,000

We go to the doctor for an X-ray before an operation. Nurse asks us 200 questions. We buy a $1,300 Flat screen TV and we do two hours of research on the internet.

We should do the same when buying a house. Ask questions. Be inquisitive (e.g what part of Reno has the most demand? Which area is holding up best in value?).

You'll be very delighted to know that it's not hard to find the answers to these questions.

Some people avoid the real estate statistics game because professionals make it sound like biochemistry. It's not. Like basketball and courtship (roses, rocks and romance), stick to the fundamentals; Median price, supply and demand.

Don't rely on your agent's opinion on the market. We are merely messengers to what the market is saying--the cupido for you and the market's romantic bliss—based on hard facts and easy to understand graphs, of course.

They say that all markets are local. That a struggling real estate market in Reno may not ring true for Dallas.

It's true. But push it a bit more. Effective agents--like good lawyers, search for loopholes---”hyper local”. Meaning, they can find out that Reno's home prices might be falling at 10% a year but homes in South Reno under $250,000 are stabilizing because of brisk demand. Stuff like that.

Also, be nice to your agent when inquiring. Try not to come off as knowing more than them. Their last name is not Einstein, but their job is to find answers to your questions.  But you need to ask--this is the biggest investment you'll ever make in your life.

What You Can Do: Learn the median home price trend for your city and area (go back two years or more if possible). Supply and demand (at least two years).

“Advertising people who ignore research are as dangerous as generals who ignore decodes of enemy signals.”

                                                            -David Ogilvy, (Inspiration for the hit show 'Mad Men').

5.  Not Paying Attention to HOA Fees

HOA (Homeowner Association Fees) fees can vary widely in price, from as little as $25 (sometimes $0) to as much as $300 or more a month.

These fees raise your monthly housing budget.

For example, condos in Reno have higher fees ($200) than houses ($30).  Exclusive communities tend to have higher HOA's.   Somersett is a popular exclusive community in Northwest Reno but many people are turned off by the $220 HOA fees.

Things you may want to know:

• HOA are not negotiable. Expect to pay them on a monthly basis.

• HOA fees will likely change over time.
  

• Learn the HOA rules: Know what's allowed and what's not (e.g white picket fence).

• Make sure the home you want to buy is not already out of compliance with HOA rules Buying into an existing problem can be a headache.
  

• Consider your temperament. One of the major benefits of homeownership is the ability to customize and alter the property to suit your needs, but HOA rules can really interfere with this.

•  Find out what the monthly dues cover. Will you still have to pay extra for garbage pickup? Is cable included? Compare dues for the complex or neighborhood you are considering to the average dues in the area. Keep in mind that you will have to pay for recreational facilities whether you use them or not.

• There's no cap on almost all HOA.

• HOA are not regulated.
  

The good side of HOA: The services covered under HOA fees may include: lawn and landscape maintenance (for your property, common grounds or both), snow removal, community amenities, such as swimming pools and tennis courts, security services, trash removal and utility fees, just to name a few.

Sources: denverpost.com & frankelrealtygroup.com

“Be thankful we're not getting all the government we're paying for"

                                                                          - Will Rogers

6.  Not Computing for Property Taxes

This is tricky because you will not know how much it is until the home is already yours. But a good rule of thumb is newer homes cost a lot more.

In Reno, a 2005 built home may cost $3,000 - $4,500+ / year in taxes. On the other hand, a 1970 built house  costs $800-$1,300.

Things you may want to know:

• Property taxes vary from city to city and are affected by both local and state tax laws.

• Property taxes reflect the changes happening in the city. If the city is experiencing high growth and the increased infrastructure and city service needs that go with it, property taxes may be assessed and raised annually. If the city is not experiencing growth, taxes may remain unchanged for years.

• Make sure you get what you pay for. If you're paying big money on taxes make sure that it goes back to you by having good schools, infrastructure etc.

Sources: life123.com

What You Can Do: If you're buying a new home (you won't know the taxes until home is yours), find similar homes in the area (price, age and size). Note: this will only give you an estimate. If you're buying an existing home, the agent will be able to give you the last payment the previous owners were paying.

“The art of taxation consists in so plucking the goose as to obtain the largest amount of feather with the least amount of hissing.”

                                                                                                          -Jean Baptiste Colbert

7.  Hiring a 'YES' Agent

Lastly, hire an agent that will guide you to all that we've been talking about and more.

Like marriage, I think it's vital to have a love-hate relationship with your beloved agent. It's more fun and profitable that way. There will be ups and downs, and you shouldn't avoid it.  Why? Because a good agent won't always tickle your ears—they might need some scrubbing once in a while. And vice-versa.

Effective agents are passionate agents. A good agent are like Jim Stockedale (Vietnam POW) “confront the brutal facts but never lose hope that in the end you wil prevail.”

“It is difficult to get a man to understand something when his salary depends upon his not understanding it”

                                                                               -(hopefully not one of my clients)

**You can read more of Joe's idiosyncrisies at his Reno Real Estate Blog

Superb photo by: marco welt

"I haven't seen a monument erected to a pessimist" 

Oh what a refeshing quote to hear in this dire financial crisis we're in.  But where do we draw the line between being an optimist and in touch with the brutal truth of reality?

There's a fine line. 

I love what Jim Stockedale said "confront the brutal facts, but never lose hope that in the end we will prevail."  Now that's more like it.  Can you imagine what would happen to our profession's credibility if we put into that into practice?!

I sense people are looking for those kinds of agents.  By and large, I've noticed people still want good stories, the heroes prevailing over the villains.  The John Wayne's of business.  Laughter over despair.  They want the truth, but they also want to hear hope coming out of our mouths.  Instead of blind faith, they want to know all the sides of the story based on hard research, but still understandable for the common man.

They need us--Realtors.  Honest. Hard working. Trustworthy.  That's who we are.

P.S--Condolences to the family of Paul Harvey: 1918-2009.  You will be greatly missed. The greatest broadcaster the world has known, left to be with his Creator.

* you can read more about Joe's thoughts and advice at--Reno real estate blog

  Excellent picture by: Jane

*if you want to know more about the Reno real estate market go to Reno Homes

Now, you're looking for a house.  You've done a bit of research.  You've been pre-approved by your lender. 

You've talked about the budget. You've chosen an agent to represent you. If you haven't,--Joe Salcedo is here =)

So What's next?

Selling and listing prices are usually different From 2002-2006, many homes sold for more than the asking price. Buyers were competing against each other. Now, about 80% of homes sold in Reno are below the asking price--buyers competing against the sellers.

It is not unusual to get $20,000-$30,000 + less than what you're asking for--hence, the term "lowball offers." But notice I said " 80% of homes sold", the other 20% are the ones that are in the first time home buyer range--$150,000-$200,000.

This is a a VERY ACTIVE market. There have been times this year where I offered more than asking price--and still lost!

If you find a house that you really like in this price range, it may not be a good idea to make an offer below the asking price. Buyers are actually competing for these homes even in this down market (see: graph below).

Demand--$150,000-$200,000:

(click here to enlarge) Median price, in effect is holding up::

(Click here to enlarge)

In Making Offers To The Sellers

Search for all sales that closed (one year's worth), pending and currently for sale (any agent can do this for you), try to get as close of a match as possible (location, bedrooms, baths etc).

Note: due to the falling real estate prices, your offer for the seller will most likely be lower than the comparables from a year ago (not necessarily applicable for under $200,000 prices).

How Much Should I offer? Sellers by nature "test" the waters. They tend to initially ask for more than what they are willing to take for their prized homes. Here's where research can reeeeeeealy help. Take for example:

Demand for $400,000-$500,000 Homes in Reno

(click Here to enlarge)

In this kind of market, as you can see in the graph, the buyers are not that many. So take your time and feel free to make low ball offers if necessary.

In Summary As you can see doing a little bit of research can help you a lot. Research will guide you in what kind of offers to make, whether lowball or possibly highball (in the case of the $200,000 and below range). The most important thing to remember is to know what you really want for a house and at what price range, and stick to it.

If you are looking for $300,000 and above it may be wise to be patient by not being attached to the homes that you are making an offer to. There are many great homes out there waiting for you. If you are interested in knowing more about an area in Reno-Sparks (demand,median price etc) You can reach me at 775-338-7653

--Joe Salcedo of Reno Real Estate

Superb photo from: neloqua

Have you found yourself on those moments when you read something that's written straight from the heart and you just say to yourself, "wow thanks for putting on paper what I can't explain inside."

That was me thirty minutes ago when I accidentally stumbled upon this article, and from all places, a blogger in Reno. 

I'm telling you, Reno is much more than topless women and blackjacks.

I'm aware that letters like these invoke some kind of "weird-guilt".  But that's not my purpose--to make you feel bad.  Actually, it's more of an "weird-encouragement", that if you can relate, we are not alone.  And it's not too late to do something about it. 

One baby step at a time.

Well here it is.  From a successful local businessman in Reno: Full story

"So much excess and nothing that matters. As a for instance, u could fit 4 of my childhood homes inside the home my son and I live in now. I have a commercial kitchen in my home that rarely ever cook in. One of my cars cost 5 times what my dad paid for 309 K in 1970. I am not bragging. I work my ass off. You want it, go get it. But, there's a trade..."

*Joe Salcedo is author of a Reno Real Estate Blog:  

"A Reno Real Estate Agent Who Lost $50,000 in the Reno-Sparks Real Estate Market is on a mission To Understand the Market just a little bit better "

" I don't trust a person whose never been depressed," Dan Betzer once said.

The number one disease in our industry is blind optimism. 

I love my profession.  I love NAR.  I love how the past three years has been the hardest times in my career. 

"This market will separate the men from the boys," said JoAnne Correira- ain't that the truth. 

Yet through these three years I have grown emotionally,professionally,mentally even spiritually at a pace that would put Michael Schumacher to shame.

But if we want our profession to survive and thrive in the next hundred years, Heaven help us to be intellectually honest with ourselves and most especially towards the market.

But we don't have to stop here ladies and gentlemen. We just have to start there.  Nobody wakes up in the morning and says to herself, "Oh I can't wait to meet my miserable real estate agent."

Jim Stockedale said it best, "confront the brutal facts but never lose hope that in the end you will prevail."

..And life, I promise you, will become a romance.

Because in the end, we shall prevail: How I Survived The Reno Real Estate Market Downturn Through The Eyes Of Bear Grylls

                                                                                         -Joe Salcedo

                                                                                          Of Reno Real Estate

Caughlin Ranch home

Welcome to Reno's finest and most comprehensive master-planned community, the Caughlin Ranch.

The Caughlin Ranch encompasses 2300 acres, stretching from the foothills of the Sierra Nevada mountains to the Truckee River. The Master Plan is designed to offer a unique balance between the man-made and natural environments. The Caughlin Ranch Development Standards Handbook and its updates are the blueprints of the master plan. The implementation of the master plan began in 1984, and is expected to continue approximately twenty years. The community offers the finest in single family, commercial, professional office and recreational facilities.

It is my goal for you be so familiar with the Caughlin Ranch Real Estate market that you will be ahead of your competition whether buying or selling.

In this report you learn about Caughlin Ranch's

• Supply of homes
• Number of homes SOLD
• Median Price homes SOLD
• I also share my thoughts on the the data uncovered.

Here it is: Caughlin Ranch Real Estate

My blog: Reno Real Estate

Somersett Country Club

Somersett is perhaps the most sought after luxury neighborhood in Reno  especially when the market was red hot back in 2003-2006.  It is situated in Northwest Reno.  A few minutes away from downtown Reno and one of the first exits coming from california I-80 East.

In this report it is my goal to make you so familiar with Somersett's real estate market that you will know exactly what is happening in the area.  This will give you the much needed knowledge in negotiating or selling your home.

This report talks about:

1. Supply of homes in Somersett
2. How many homes have been SOLD.
3. Months Supply of inventory.
4. I also share my thought on the stats uncovered.

Here it is: Somersett Real Estate

"Every Somersett resident enjoys the 9-hole Tom Kite designed Canyon Nine Golf Course, the 9 million dollar Club at Somersett recreation center, and over 27 miles of paved and natural hiking and biking trails. The Canyon Nine and The Club at Town Center are exclusive to residents and included in residents' monthly owners association dues."

                                                                                     Http://RenoHomeBlog.com

Arrow Creek Country Club

I know what you may be thinking..

Arrow Creek Real Estate Report?

'Borrinnng.' or 'is this worth my five minutes?'

Well, I am not in liberty to say that this report will change your life right away.  But I think this will add value to you.  Especially if you are planning on buying or selling in the Arrow Creek area.

Ok, Here it is.

Here you will learn about:

1. Number of homes for sale in Arrow Creek(divided per month for the past two years)
2. Number of Homes SOLD.
3. Arrow Creek Median prices of homes SOLD for the last two years.

I also share what I think about the stats I uncovered.

After reading this report my hope is you will know the Arrow Creek market better than 90% of the Reno population.

Here it is: Arrow Creek Real Estate

*About Arrow Creek:

Arrow creek is an exclusive luxury neighborhood in South Reno.  It has 36 holes of championship golf course located a few minutes from lake tahoe