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Reno and New Zealand's Real Estate Market: Eerily Similar

Dan Wyatt, a good friend of mine, asked me to meet his relatives from New Zealand to discuss their real estate situation.  New Zealand's current real estate market is eerily similar to our market back in 2006.  It was an intense yet fruitful meeting.  I learned a lot.  This is an insightful graph I found while scouring for more data about their market.

  By: 26econ.com
(click image for full-view)

The Beauty of Facts

Facts and graphs, especially when clearly presented, is like an X-ray report to a doctor.  The moment I laid my eyes on the above graph I felt a deep aching in my stomach.  The same feeling I had in 2006 when I found out that the market was already topping and on its way down.

I first asked Dan's relatives if I can be totally honest with them and express what I felt about their situation.

 I then shared what happened in our real estate market in the past three years.  The good, the bad, and the ugly.  Then I found an article by the economist reporting in detail about their country's current and potential turmoils.  After that I felt that it was safe for me to tell them that what happened in our country's real estate market will, in my opinion, happen to them(if not happening already).

The Solution

I told them that If I was in their situation I would do everything I can to sell my house and cut my losses short.  I knew this was going to be hard for them.  I can't blame them but I also told them that this was not foreign to me,that I was once in their place and I knew how tough it is to do what the market was telling them.  But regardless of what our feelings are, it is crucial to listen to the market.

But like most Hollywood movies, there is also a happy ending.  Knowing that the market is falling down and therefore cutting their losses short, they could well be on their way to getting a better value of a home a few years from now.  In short, they can choose to sit on the sidelines and wait. 

Patience is key.

Is it over or is it going to get deeper? A tale of two stories-you decide

Photo from: IBD


I want to share this article to you guys.  It is hard to find real estate reports like this-balanced, fact based and easy to read. 

Housing slump may be nearing its end

"New-home sales fell less than expected in June and inventories dropped to a 3 1/2-year low, the government said Friday, fueling hopes that the worst of the housing slump is over. Meanwhile, durable goods orders and consumer sentiment unexpectedly rose"

Wait,it may take longer

"Stronger sales and falling inventories are hopeful signs. But the housing and mortgage markets remain deeply troubled.

Existing-home sales fell 2.6% to a new low in June, the National Association of Realtors said Thursday. The supply of homes rose to 11.1 months' worth as banks unload foreclosed properties."

*Read the rest of the article here

Reno real estate market shows some resiliency amidst nation's real estate woes

The country's existing home sales fell 2.6%, the lowest number of sales in the nation since the data  series began in '99.   Not so locally, home sales in Reno and Sparks continue to go up.  What could this mean?

Click here for full-page view

Much as I desire to make the conclusion that the bottom for the Reno real estate market is just around the corner, I think it's still too early.  But what I want to point out here is the Reno market,amidst the country's real estate woes, is currently holding its ground in terms of existing home sales.  That says a lot about our real estate market. 

In Wall Street, when the general market is going down, most of the stocks follow the trend, but things to look out for are those few stocks that may be falling, but not as hard as the others.  So I couldn't help but make the correlation about what's happening now with the general real estate market and our local market.  Will Reno be one of the choice cities that will be the first ones to recover? I'm certainly hopeful. 

What do you think???

John Wooden on Real Estate

Photo from: endued.com

"I'll take mistakes over perfection for a hundred points--but not a lot of mistakes"- John Wooden

When the real estate market tanked a few years ago many people were affected and I was one of them.

It's a lesson learned--the hard way. But one we shouldn't brush under the rug. 

Truth be told, there are a lot of us, and I want you to know that you're not alone. And like a fallen comrade in arms, I humbly suggest we should share each other's load by sharing each other's lessons learned.

We need each other.  It almost sounds overly dramatic I know.  But I realize vulnerability, however hard at first, can be ultimately rewarding, for it brings people closer.  There's just not enough time to make all the mistakes one can afford in a lifetime.  I want to learn from you as much as I want you get something out of my researches.

And like all things, time can heal the deepest wound.  I love what John Wooden on page seventy-four of his book My Personal Best,

"Please don't make a second mistake because you're thinking about the first". 

No we won't make the same mistake twice. 

Reno Real Estate's Investing tip: Cut your losses short

superb photo by:Doxieone

                          "Cut your losses short"

                                                       -From Investors Business Daily's 20 Investing Rules

I haven't met a man who enjoys being wrong.  Nobody does.  And admitting that you've made a mistake, yeah, I won't even start with that (just ask married couples).

That's why this rule is a lot tougher than it reads.  This rule could also be summed up as 'admit you were wrong and take a hit to avoid getting in deeper'.  A rule that we must subscribe to if we are serious in being successful in real estate.  Nobody is right 100% of the time.  It's impossible.

The great stock trader William O'Neil once said that if we are right just 50% of the time in investing but cut our losses for the other 50% (mistakes), we can be very wealthy.

last summer I had a client who wanted to sell her house.  We priced her home to be in the top three in the neighborhood.  After less than ten days we had gotten seven showings. Not long after, I sensed a certain complacency 'oh, we got seven showings in just over a week,maybe I don't really have to rush this' and decided to pull out their home from the market. 

I tried to explain to them how the market was already going down and from the looks of it the correction would continue to deepen.  They did not heed what the market was telling them 'cut your losses short'. 

And I understood where they were coming from, if they sold at that time their profits would be significantly lower than if they had sold a year or two before.  It was a harsh reality.  But one that they had to face, I tried to tell them that based on the market's stats, the losses would continue to mount if they did not act fast.  They decided to wait in the sidelines.

In less than a year I had closed a home for my other client (buying side) in the same neighborhood,same size, same everything.  I closed the home for $40,000 less than what we were asking for just a year earlier for my other client(seller).  In short, they lost $40,000.  From harsh to brutal. 

My heart just breaks for stories like these.

But I want to make a point that the market does not care who we are,whether rich or poor,prominent or pauper--the market will be ruthless or good depending on how we'll play it.  So wouldn't it be better if we played on its side?

And life, my friend, will become a romance.  Hopefully.

What Real Estate Can Learn From the Stock Market

amazing photo by: kipnotes.com

"Nothing is more difficult, I truly believe, than consistently and fairly profiting in Wall Street.  I know of nothing harder to learn"
                                                              -Gerald Loeb

We've all heard them before, "stay away from the stock market,invest in real estate". Perhaps.  And for the majority this is probably a good rule of thumb.

But what we can all probably agree on is that the stock market is much tougher a place to invest than any other.  Your one dollar is one dollar.  Whereas in real estate leverage is the name of the game, you can get yourself a ten dollar home for an initial investment of three. 

There is great money to be made in both paths.  But one thing is certain , if we desire to be successful in either one we need to have a game plan.

"Any way one looks at it, nothing is more difficult than succeeding in Wall Street, yet nothing is attempted by such poorly equipped people or is considered as easy."   -G.Loeb

Friends, we must be equipped.  And one thing we can all learn from very successful Wall Street traders is that they are inquisitive, they scour for data and hard facts.

And they will tell a story:

click image to view larger image

Reno-Sparks (Washoe County) Sales Trends By Zip Code

 

"Numbers tell a story" a wise sage once said.  The secret in investing whether in stocks or real estate is the delicate balance of two things: facts and instinct. 

You don' necessarily have to be Donald Trump (too much of the 2nd) or Prof. Gerald Lambeau (victim of the first).  Life is two-dimensional and often, more-and that's what makes it beautiful.  When I applied this principle in investing it has opened a door for me that I never want to leave from.  It has made my job more exciting, kind and ultimately more rewarding. 

About this post: 

• If you are planning on moving to the Reno-Sparks area and you want to know the activity in the area you desire, this post is for you (divided by zip codes).

• If you live in the Reno-Sparks area and are planning on selling your home and you want to know how many homes have sold in the past year and at what median price, this post is also for you.

ZIP CODE	SALES	MEDIAN PRICE
89402	5	$1,860,000
89431	217	$207,350
89433	95	$220,000
89434	269	$254,000
89436	934	$297,700
89439	28	$373,775
89441	202	$316,475
89451	89	$1,140,000
89501	5	$380,000
89502	222	$244,200
89503	199	$242,594
89506	592	$233,825
89508	248	$243,525
89509	258	$350,000
89510	15	$445,000
89511	322	$631,250
89512	126	$225,000
89519	99	$501,209
89521	583	$330,000
89523	468	$325,682
89704	39	$366,831

More resources:

• Reno-Sparks supply and demand
• Hottest area codes in Reno

*This report is based on public data gathered between 7/1/2007 and 6/30/2008. 

*Information gathered by First American Title

 

Chase Nation: I'm Proud Of My Momma

I rarely advertise my own.  I'm deliberately disobeying my rule today.

When I was being recruited to join Chase more than a year ago, Craig King, Chase's COO, told me something I will never forget: " Joe, I can sit here for an hour and tell you how great our company is, which I'm sure you've heard from previous companies.  But to fully experience Chase you need to try us out even for just a month.  And you'll see what we're talking about"

So I did.  And he was right.  My latest evidence is the newest 'baby' project of our company: Chase Nation

Shari Chase is the President and CEO of Chase International, our real estate broker.  She along with the genius Diane Cohn cooked up Chase Nation whose sole purpose  is 'to be the place to talk about Reno-Tahoe real estate online'.  To accomplish this they have set some cool community guidelines 'Blatant advertisements are not allowed in blog posts and will be deleted without notice'. 

And people have flocked.  Currently we have 412 members and the site is barely a half year old.  People are hungry for good real estate information and chase nation wants to be 'the' place.

Craig King was right.  They will not settle for anything less than the best.

While other companies are cutting down extensively on their marketing and man power Chase decides to go the other way.  That's a genuine trailblazer. 

Good job you guys.

Top 10 links of the week

amazing photo by: photoplasia

• For those of you interested in what's happening in the real estate market at the West Side of Los Angeles (Especially Sta. Monica) I found a winner: Westside bubble

• Though not related to real estate, this blogger is making some waves.  Her short Bio says it all: 'A 20-something on a mission to climb the net worth ladder,navigate the quarter life, and find that perfect pair of heels' Enjoy:  Well-Heeled investor 

• Ryan Ward on why he's saying 'just say no to foreclosures': Ryan Ward

• Mr. Bunn's post about Northern VA's "Rentals going nuts".  Interesting post, could also happen here in Reno: Asburn Rentals
  

• Trisha Allen's wants to build an empire and she's juggling five things at a time,talented girl indeed: Trisha Allen's blog

• Single mom would give her heart as well as her house to lucky buyer ' I'm struggling...I don't want to lose my house and I want to find somebody'.  Amazing: Single mom home for love

• True Gotham gives unique insights on the Manhattan Real Estate Market.  I also like how he's honest about his not so uplifting moments in Real Estate.  Takes a man to own up to that:  Manhattan Real Estate Blog 

• New York real estate blogs are always on top of their game. This is a video blog for 'real estate-obsessed  NYC:  New York Video blogger

• I'm not usually a fan of 'how-to' blogs.  But this one is the few exceptions 'as seen in New York Times':  Blueprint For Financial Prosperity Blog

• My type of website.  Concise,clear and swimming with raw numbers: Housing Indicators from Federal Housing Enterprise
  

Reno-Tahoe Summer Schedule 2008

Photo by: About/reno.com 

Every year it seems my family and I are enjoying Reno's summer more and more!

I was at Downtown yesterday for Artown and boy did we have fun.  If you haven't gone this year, I highly suggest that you do.  Grab a schedule (for Artown) and take the family with you- they will enjoy it, I assure you. 

Here are other upcoming event this summer:

JULY

• July 1- 31:  Artown

• July 2-4:  Red,White & Tahoe Blue

• July 3:  King Beach Fireworks

• July 4:  Truckee's 4'th of July Parade

• July 4:  Rancho San Rafael Park Fireworks

• July 4: South Lake Tahoe Fireworks

• July 4:  Star Spangled Sparks

• July 4:  Tahoe City Fireworks

• July 10-15:  American Celebrity Golf Tournament

• July 10- August 17:  Shakespeare Festival

• July 12:  Italian Street Painting Festival

• July 19-20:  Squaw Valley Arts and Wine Festival

• July 17-August 9: Lake Tahoe Music Festival

• July 22-26:  Great Basin ChauTauqua Festival

• July 26:  Paddle,Pedal Kids Triathlon

• July 29- August 3:  Reno Tahoe Open

• July 30:  Chase Reno Estates Tour

August

• August 1-10:  Hot August Nights

• August 2:  Pyramid Lake Sprint Triathlon

• August 7-9:  Lake Tahoe Concours d'Elegance

• August 15:  Nevada Museum Taste of Art

• August 16-17:  Reno Tahoe Blues Festival

• August 16-17:  Brews,Jazz & Funk Fest

• August 16:  Chillin' & Grillin' on the Comstock

• August 20-24:  Nevada State Fair

• August 27- September 1:  Best in the West Rib Cookoff

September

• September 4-7:  Virginia City Camel Races

• September 5-7:  The Great Balloon  Race

• September 5-7:  Street Vibrations

• September 10-14:  National Championship Air Races

• September 13-14:  Animal,Art & Wine Festival

• September 20:  Tahoe Big Blue Adventure Place

• September 14-20:  Oatbran Bike Across Nevada

• September 20:  Sparks Oktoberfest

• September 26-28:  The Lake Tahoe Triathlon

• September 27-28:  Genoa Candy Dance & Craft Faire

October

• October 5:  XTERRA USA National Championship