Reno Home Blog

Reno Buyers: cont...New Homes

  'yes you can' By: Robert Hauk

(source: tips and tricks when buying a home)

Don't Forget to Bargain on Terms:

This is often the case when interest rates are higher and it's difficult for buyers to qualify for mortgages.

The builder may be willing to "pay down" the mortgage by several points.  For example, you'll get the mortgage.  However, instead of paying the going rate of, say, 9 percent for the first 3 years, you might pay 7 percent, with the builder paying the other 2 percent.

On a $200,000 mortgage, 2 percent  points can save you roughly $4,000 a year in interest payments.

But beware of builders who pay down the mortgage just to raise the price by an offsetting amount.  In the above example, you would save close to $6,000 over a three-year buy down.  But if the builder raised the price of the property by $6,000, where would your savings be? You'd be converting  a lower payment into a higher price.  And after the first three years, you'd be paying mortgage interest on that higher price.

In most cases, a builder won't buy down an interest rate unless the houses have been sitting around for awhile and interest rates are keeping the buyers away.

TIP---Check For The Original Price

By talking to those who bought six months ago in the same tract, you should be able to establish what the original pricing was.  Thus you can determine if the builder has raised the price to pay for your buy down.

Buyer question: Can I negotiate price with the builder (new homes)?

  'yes you can' By: Robert Hauk

(source: tips and tricks when buying a home)

Now we come to the tricky part for many new home buyers: negotiating with the builder. 

Can you? Yes.

Many  who purchase a new home are completely lost, signing anything and everything that is placed before them.

Just as with purchasing resale , when buying a new home everything is negotiable.  The problem with new homes, however, is that the builder is often tied into financing and labor and materials contracts so that he or she cannot really offer the flexibility that an owner of a resale can.

Typically when buying a new home, you are presented with a colorful and expensive-looking brochure that gives the floor plans of the various models that the builder is offering.  Along with these is usually a price schedule.  For Plan A the price is $185,000 until January 2, when the price goes up to $187,500.  For Plan B the price is $235,000.  For Plan C it's $268,000.  And so forth.

In addition, there are premiums for better lots as well as additional costs for upgrades, as described earlier.  Thus the prices are laid out in the same fashion  as they are in a grocery store.  You certainly can't bargain with the grocer over the price of a jar of mayonnaise.  How do you bargain with a builder over the price list for a new home?

TRAP--Don't Get Suckered 

It's important to understand that builders and developers like to create the impression that nothing is negotiable--either you take their price or you don't get the house.  That's part of the reason for the elaborate brochures.  The truth, however, is that builders are real estate sellers just like any other.  When builders need to get rid of homes, they will negotiate down to the bare bones, regardless of what the brochures say.

TIP:  The easiest way to negotiate  is to find a builder who already has houses up.  Builders pay a hefty finance charge each month that the houses remain unsold.  They are highly motivated to sell the property.

Why a curious investor makes more money than average joe

By: Osvaldo_zoom

They ask questions.

They never feel they know enough.

They're inquisitive.

They listen more than they talk.

I get irritated with people who fall in love with their new found opinions--usually recycled from their favorite blogger or economist.

From then on, you can expect to hear dogmatic statements like: "market is going down until January of 2009 (true story)" or "the market is going to be dandy, just a fluke--no worries."

"The test of a first-rate intelligence is the ability to hold two opposed ideas in the mind at the same time, and still retain the ability to function"      - F. Scott Fitzgerald

The curious investor leans on his rules not unlike how he leans on his wife for support .

He studies, follows the top bloggers and peruses statistics like a rocket scientist--but he remains open to possibilities.  Most importantly, he doesn't fall in love with what he knows--he's not afraid to admit his mistakes.

And after feeding his thirst to understand his environment--he relies on instinct to make the hard investment decisions.

And this, my friend, is how they make more money than average Joes.

Perhaps the greenest home in reno,sparks and carson

It's going to be in the market..coming soon.

Address:  4600 Voltaire St. Carson City, NV

Year Built:  2009

Sq. Footage:  2,700

Bedrooms:  3

Bathrooms: 2.5

Floors: 2

Parking: 2 covered spaces

Lot Size:  .5 acres

HOA/Maint:  $35/month

INTERIOR FINISHES DONE FRIENDLY:

no volatile organic compound (VOC) paints used throughout the home. No VOC floor coverings used, only bamboo and concrete composite flooring materials. The concrete floors are finished with an environmentally friendly stain product in lieu of acid stains.

LIGHTING:

High efficiency electrical fixtures with the use of highly efficient compact fluorescent bulbs and the designed placement of lighting offer maximum exposure while using minimum amount of fixtures.

COUNTER TOP MATERIALS:

Vetrazzo brand recycled glass counters- made from excess glass from manufacturing plants, and demolition by-product from glass structures.
Recycled plastics have been utilized on bathroom two and utility room counters.

APPLIANCES:

Energy star appliances an induction range for maximum cooking efficiency without gas, and minimal use of electricity-only using electricity when a pan is on the burner, and safe because it does not heat the burner surface, the pan itself heats! A convection/steam oven is also an effectively efficient kitchen facet to the home.

RENO REAL ESTATE GOLDEN 'TIP': CUT YOUR LOSSES SHORT

Ladies and gentlemen:  this is going to be a short post--cut your losses short.

The Reno real estate market topped August of 2005:

 

Let's say that there is absolutely no way that we would have known about this.  As the chorus goes " nobody can't predict what the future holds"--(which I don't buy.)

Market topped, on it's way to avalanche down for the next...well, up until now.  So is this the end of the world?

No. 

Reno homes median price:

June 2007:  $319,900

June 2009:  $184,044

(click to enlarge)

Ladies and gentlemen, even if we were a year late in learning about the market crash, we could've still saved $135,000.

Cut your losses short.  We can never be right 100% of the time but if we cut our losses short we would live to see another day and avoid being wiped out.