As we kick off the new year, the Reno real estate market is already buzzing with activity. Whether you're a seasoned investor, a first-time homebuyer, or a property owner looking to rent out your space, January 2025 offers exciting opportunities. In this post, we’ll explore key trends, offer expert tips, and highlight the unique advantages of diving into Reno real estate this month.
Market Trends for January 2025 Steady Growth in Property Values Reno continues to attract new residents, thanks to its robust job market and proximity to outdoor recreation. Property values have seen steady growth, making this a promising time for both buyers and sellers. Increased Demand for Rental Properties With remote work remaining a popular option, many individuals are relocating to Reno for its lifestyle perks. This has driven up demand for rental properties, presenting a lucrative opportunity for property owners. Low Inventory, High Competition Inventory remains tight, leading to increased competition among buyers. Partnering with an experienced real estate agent can give you an edge in securing your ideal property. Why Invest in Reno Real Estate This January?
Tips for Buyers and Sellers in January 2025 For Buyers:
For Sellers:
Maximize Your Investment with Professional Property Management If you’re a property owner, working with a trusted property management team can help you:
At Conde Houses, we specialize in helping property owners streamline their investments and achieve their goals. From tenant screening to maintenance, we’ve got you covered. Best Neighborhoods to Live in Reno for 2025 Midtown Reno Known for its vibrant culture and walkability, Midtown continues to be a hotspot for younger buyers and renters. Somersett This master-planned community offers stunning views, a golf course, and a family-friendly atmosphere. Double Diamond Popular among professionals, Double Diamond features modern homes, great schools, and easy access to major employers. Start the Year with Smart Real Estate Moves Whether you're buying, selling, or renting out a property, January 2025 is the perfect time to capitalize on Reno’s thriving real estate market. By staying informed and partnering with experts, you can turn your real estate goals into reality. It may seem like there’s always something going on as a homeowner, from silencing a squeaky hinge to unclogging a temperamental toilet. But many household problems can be easily fixed without calling a repair service.
A can of WD-40, a toilet plunger and a bottle of vinegar are great basics to keep on hand for easing sticky fittings, clearing the toilet and making short work of common stains. Here are some simple fixes for common home problems that even the non-handy can handle: Squeaky Floorboard Banish that annoying squeak by sprinkling a little talcum powder over the noisy area and brushing it into the cracks. Stained Tub Removed stubborn stains by combining equal amounts of cream of tartar and baking soda with enough lemon juice to make a paste. Rub the mixture into the stain with your fingers or a soft cloth. Let sit for a half hour, then rinse well with water. Stuck Sliding Windows Loosen stuck windows by spraying a little silicon spray lubricant (found at hardware stores) onto a rag, then wiping along the tracks, whether metal, wood or plastic. Dry and Worn Cutting Board Revive a worn board by warming a bottle of mineral oil (available at drugstores) in a bowl of hot water, then wiping the oil onto the surface with a soft cloth. Wipe off the excess four to six hours later. Scuffed Linoleum Take care of scuff marks by rubbing the spot with white toothpaste and a dry cloth, or spraying WD-40 on a towel and rubbing lightly. Later, degrease the area with liquid dishwashing soap and water. Poor Toilet Flush Before you call a plumber, look for the water valve behind the toilet, on the wall or the floor. Turn it counter-clockwise as far as you can. Once it’s fully open, the tank will get its optimal water fill and power up your flush. Torn Window Screen If tiny tears are letting bugs in, apply clear nail polish to any tiny holes. For larger rips or tears, look for new and effective screen repair patches at the hardware store. ![]() For $600 or so a year, plus a service fee of around $75 every time you ask for repair, a home warranty can be an inexpensive way to have peace of mind as a new homeowner. Home warranties cover breakdowns in a home, from HVAC systems to appliances. A broken water heater can be repaired within hours, but if it can’t be fixed, a home warranty can pay for a new one to be installed. For homeowners with an older house, they may want more things covered than a newer home would need—such as older appliances—and will likely pay more for it. If you just bought new appliances and have a manufacturer’s warranty for a year or more, you won’t need this coverage. You may be able to exclude new appliances from a home warranty to cut down on costs. Things that can be covered by a home warranty include ductwork, electrical, plumbing, dishwashers, refrigerators, ovens, stoves, clothes washers and dryers, and water heaters. Things that are unlikely to be covered include expensive items such as septic tanks, wells, heating systems, pools, garage doors, windows and doors, sprinkler systems, pre-existing conditions, and walls. Coverage for such items may cost more. Roofs may also be exempt, though some home warranty companies sell plans to fix leaking roofs. Consider Cost A big factor in deciding if a home warranty is worth buying is cost. Basic coverage can start at about $300 and go up to $600 or more. Some home warranties charge for a service call, such as $75 or so, while others allow unlimited service calls. Contractors are screened and sent out by the company. To determine if a home warranty cost is worth it, start by learning how old your appliances and home systems are and if the original equipment manufacturer warranties still cover them. Find out what the expected lifespan of each item is to help you figure out if a home warranty is needed. Some home warranty companies require annual maintenance on appliances and home systems to keep the warranties valid. Some may ask how long you’ve had them. Don’t expect the home warranty company to pay for the annual maintenance of your appliances or home systems. Read the contract carefully to make sure that old appliances are covered in the home warranty. Some don’t cover old appliances, such as anything more than 10 years old. Any home, whether old, new or somewhere in between, will have things break sooner or later. Appliances and home systems only last so long. For $50 a month or so, a home warranty can provide peace of mind when things eventually fail. THREE QUESTIONS TO ASK ABOUT YOUR HOME EQUITY LOAN ![]() The Internal Revenue Service has advised taxpayers that interest on a home equity loan used to build an addition to an existing home is typically deductible, while interest on the same loan used to pay personal living expenses, such as credit card debts, is not. Click here to view the announcement. Here are three examples from the announcement with updated dates: ARE YOU USING THE FUNDS FOR HOME IMPROVEMENTS? In January 2023, a taxpayer takes out a $500,000 mortgage to purchase a main home with a fair market value of $800,000. In February 2023, the taxpayer takes out a $250,000 home equity loan to put an addition on the main home. Both loans are secured by the main home and the total does not exceed the cost of the home. Because the total amount of both loans does not exceed $750,000, all of the interest paid on the loans is deductible. However, if the taxpayer used the home equity loan proceeds for personal expenses, such as paying off student loans and credit cards, then the interest on the home equity loan would not be deductible. IS THE LOAN ATTACHED TO THE RIGHT PROPERTY? In January 2023, a taxpayer takes out a $500,000 mortgage to purchase a main home. The loan is secured by the main home. In February 2023, the taxpayer takes out a $250,000 loan to purchase a vacation home. The loan is secured by the vacation home. Because the total amount of both mortgages does not exceed $750,000, all of the interest paid on both mortgages is deductible. However, if the taxpayer took out a $250,000 home equity loan on the main home to purchase the vacation home, then the interest on the home equity loan would not be deductible. ARE YOUR TOTAL BALANCES LESS THAN $750,000? In January 2023, a taxpayer takes out a $500,000 mortgage to purchase a main home. The loan is secured by the main home. In February 2023, the taxpayer takes out a $500,000 loan to purchase a vacation home. The loan is secured by the vacation home. Because the total amount of both mortgages exceeds $750,000, not all of the interest paid on the mortgages is deductible. A percentage of the total interest paid is deductible.
Congratulations on your mortgage refinance or home purchase closing! Here is a general overview of some information that may be helpful to you and your CPA as you prepare your 2023 tax returns (the return you'll file by April 2024).
POINTS PAID ON A HOME PURCHASE IN 2023 Closing Disclosure Page 2, Section A - If the origination charges on Page 2, Section A of the Closing Disclosure include points paid to your mortgage company to reduce your interest rate, you can deduct those points in the year paid… even if they are paid by the seller. Other fees in this section (application, underwriting, processing, etc.) are NOT tax-deductible. Only bonafide points are deductible if they are expressed as a percentage of the loan amount and paid in exchange for a lower interest rate. POINTS PAID ON A MORTGAGE REFINANCE IN 2023 Closing Disclosure Page 2, Section A - If the origination charges on Page 2, Section A of the Closing Disclosure include points paid to your mortgage company in exchange for a lower interest rate, you can deduct those points in the following manner:
PROPERTY TAXES (ACTUAL AND PRO-RATED) Closing Disclosure Page 2, Section F - Property taxes itemized in this section are generally tax-deductible in the year they are paid. However, property tax escrows in section G are NOT tax-deductible until they are actually paid by your mortgage company to the municipality (city, state, county). Keep in mind there's a cap of $10,000 in total state and local taxes (SALT) that you can deduct on your federal income tax returns. PRE-PAID INTEREST Closing Disclosure Page 2, Section F - Mortgage interest is calculated in arrears. This means that your monthly mortgage payment actually covers the month that just passed. For example, your February payment covers the interest for the month of January, your January payment covers the interest for the month of December, and so on. Oftentimes, when you refinance a mortgage or buy a new home, you “skip” a month’s worth of mortgage payments. That is why you sometimes pay "pre-paid interest" or “daily interest charges” in Section F of the Closing Disclosure. These daily interest charges cover the interest for the current month. If your mortgage interest is deductible, then the pre-paid interest that you pay in this section is also deductible (this will be included in the 1098 statement that you receive from your mortgage company). PREVIOUS YEAR POINTS NOT YET DEDUCTED You may be able to deduct the remaining portion of the original points paid on an old mortgage if you refinanced that old mortgage in 2023. For example, assume you paid points on a refinance transaction 3 years ago. You probably were not able to deduct all the points you paid in the year they were paid. Instead, you had to spread that deduction out over the 30-year life of your mortgage. So, assume you’ve deducted 3/30ths of those points so far, and you refinanced your mortgage again in 2023. You can now deduct the remaining 27/30ths of those old points that you have not yet deducted. PRE-PAYMENT PENALTIES A pre-payment penalty paid on an old loan would be deductible on your 2023 tax returns as long as the new loan was taken out from a different lender than the old loan. OTHER CLOSING COSTS Closing costs not mentioned above are not tax-deductible. However, they are added to your “tax basis” for purpose of calculating your capital gain when you sell the property. In other words, you may be able to reduce your capital gains tax (if applicable) when you sell the property in the future because your home purchase closing costs get added to your cost basis. DISTINCTION BETWEEN A QUALIFIED RESIDENCE AND AN INVESTMENT PROPERTY Everything mentioned above pertains to a mortgage transaction involving a primary home or vacation home that is elected as a “qualified residence” for tax purposes. If your transaction involved an investment property, see IRS Publication 527. STANDARD DEDUCTION AMOUNTS FOR 2023 TAX RETURNS:
![]() Opening mail from your credit card company is never fun. If it isn’t a bill or marketing letter, it’s often an update to the terms of the credit card agreement, including changes to the annual percentage rate, or APR, that determines the interest rate paid on revolving balances. Credit card interest rates are tied to the benchmark rate set by the Federal Reserve, so if you’re paying attention to what the Fed does then you might get an idea of upcoming increases. Or if you wait to receive a letter from your credit card company, the notification will usually come 45 days in advance, giving you at least one billing cycle to pay down your balance or find a better credit card. When You Won’t Be Notified However, you may not get such explicit notice if you incur a penalty APR for missing payments. The APR increase is immediate and is explained in the terms and conditions you originally received with the card. The contract will also list how you can get back to the original interest rate. Promotional rates are for a fixed period and you likely won’t get notified of when they’ll end. If your APR is variable and tied to interest rates set by the Fed, then you may also not be notified early. Your credit card company may notify you anyway, but it isn’t required. What to do About a Rate Hike If you receive a credit card rate increase notice, your best solution is to ask the bank to lower your rate. It just takes a phone call and can often get you a reduction if you have good credit history and always make payments on time. You can also shop around for a better credit card elsewhere—be sure to let your bank know of better offers that it should at least match. If you have a large balance, a balance transfer card can help you avoid the higher interest rate that’s coming soon. Balance transfer cards often offer 0-percent interest for a year or so, giving you time to pay it off before having to pay interest. The best solution is to pay your credit card balance in full each month to avoid paying interest. Not carrying a balance is one of the best things you can do to raise your credit score. Contrary to popular belief, mortgage interest is not always tax-deductible. Do you itemize your tax deductions? You cannot take the mortgage interest deduction if you are taking the standard deduction. In 2023, the standard deduction is $13,850 for single taxpayers, $20,800 for heads of household, and $27,700 for married taxpayers filing a joint return. (Please see a CPA for details.)Is your home a qualified residence? Mortgage interest is only deductible if the mortgage is attached to a "qualified residence". Taxpayers can generally deduct the mortgage interest on two qualified homes: one primary home and one vacation home. Is your mortgage classified as "acquisition indebtedness"? Your mortgage or home equity line of credit is considered "acquisition indebtedness" if it was used to buy, build, or improve a qualified residence. Generally, you can deduct the interest on mortgage balances up to $750,000 of Acquisition Indebtedness. Here are two examples:
$1MM ACQUISITION DEBT LIMIT ON PRE-2017 LOANS. Your acquisition debt limit is $1 million if you closed on your home loan prior to December 16, 2017, and the loan qualified as acquisition indebtedness at that time. You can keep that $1 million limit if you refinance that home loan as long as you do not increase the current balance on the loan. For example, if your current balance is $950,000, the new loan you’re refinancing into can’t be more than $950,000. This is also true when consolidating or refinancing a home equity loan or line of credit taken out prior to December 16, 2017, as long as you used that home equity loan to buy, build or improve a qualified residence. In that case, your combined aggregate total limit would be $1 million, whether you keep both loans separate, or whether you consolidate them into a single loan. DISTINCTION BETWEEN A QUALIFIED RESIDENCE AND AN INVESTMENT PROPERTY. Everything mentioned above pertains to a mortgage transaction involving a primary home or vacation home that is elected as a “qualified residence” for tax purposes. If your transaction involved an investment property, see IRS Publication 527. Number of the Week: $750,000 You can deduct the interest on mortgage balances up to $750,000. (If you follow the rules outlined above.) Source: Momentifi
WHEN IS INTEREST ON HOME IMPROVEMENT LOANS TAX DEDUCTIBLE? 1. THE IMPROVEMENTS MUST BE "SUBSTANTIAL."In order to deduct the interest on the mortgage as acquisition indebtedness, the IRS requires the project to be a "Substantial Improvement" that:
2. YOU HAVE A 24-MONTH LOOK-BACK PERIOD.If you are pulling cash out to reimburse yourself for improvements already made, those improvements must have occurred within the past 24 months in order to qualify for the acquisition indebtedness deduction. 3. YOU ONLY HAVE 90-DAYS AFTER WORK WAS COMPLETED.You must take out the mortgage or home improvement loan within 90 days after the work is completed in order to qualify for the tax deduction. The home acquisition debt is limited to the amount of the expenses incurred within the period beginning 24 months before the work is completed and ending on the date of the mortgage.
DON'T GET TRIPPED UP BY THESE COMMON MISTAKES! 1. HIGHER THAN EXPECTED "CARRY COSTS"A "carry cost" is the cost to "carry" the property, such as the mortgage payment, property taxes, utilities, maintenance, and other expenses. For example, if you buy a house with the intention of selling it within a year, what are the total costs you will incur during that time to "carry" the property? It's important to accurately estimate those costs so that you don't get tripped up by them later on. 2. HIGHER THAN EXPECTED "COSTS OF SALE"In most cases, you’d need to sell the house for at least 8% - 10% more than what you paid for it just to break even and cover the real estate commissions and transfer taxes. It's important to take that into account when you run your numbers so that you can accurately forecast your potential rate of return on investment. 3. VACANCY RISK AND EVICTION COSTSWhat if the tenant defaults on the rent and you have to hire a lawyer or go through a costly eviction process? Or, what if you can’t find a tenant? That's why it's important to consider risk reduction techniques like non-refundable deposits, sale/leasebacks and/or rent-to-own strategies. 4. LACK OF LIQUIDITYWhat if you need access to your capital and you can’t sell the house? That's why you should never be 100% invested in real estate. This means that if your budget for real estate investments is $500,000, you should keep part of that cash in the bank, sitting on the sidelines. This way you won’t get into trouble if the property sits vacant for a few months. Also, a cash cushion allows you to quickly take advantage of other investment opportunities when they arise.
GET TAX-FREE GAINS WHEN SELLING YOUR PRIMARY HOME! 1. What is Your "Tax Basis"?Your tax basis is the cost of buying, building, or improving a property. For example:
2. What is Your "Capital Gain"?Your capital gain on the sale of the property is your sales price MINUS your costs of sale MINUS your basis. For example:
3. What is the "Capital Gains" Tax?In the US, we're required to pay capital gains taxes on any profit ("capital gain") we receive when we sell a property. Under current law, the capital gains tax rate can be up to 20%, plus an additional 3.8% net investment income tax. Using the example above, you could be required to pay up to up to $76,160 in capital gains taxes (23.8% tax on the $320,000 of capital gain), depending on your specific income level. 4. What is the "Primary Residence Exclusion"?If the property is your primary residence, you can get what’s called a principal residence exclusion. This means that a certain portion of the capital gain is excluded from tax. Married couples can exclude $500,000 of capital gain from tax. Individuals or married couples filing a separate tax return can exclude $250,000 of gain from tax. In the example above, the entire $320,000 would be excluded from tax if this was your primary home and if you were married, filing a joint tax return. This means that you could save up to $76,160 by using this exclusion (no capital gains tax and no 3.8% investment income tax)! Here are several rules to follow to qualify for the exclusion:
STANDARD DEDUCTION, GIFT TAX LIMITS, AND MARGINAL TAX BRACKETS FOR 2022 The Internal Revenue Service (IRS) announced the tax year 2022 annual inflation adjustments for more than 60 tax provisions. Click here to view the full list. Here's a summary of three provisions that may impact homeowners and homebuyers: Standard Deduction
Gift Tax Exclusion
Marginal Tax Brackets
PLEASE NOTE: THIS LETTER AND OVERVIEW IS PROVIDED FOR INFORMATIONAL PURPOSES ONLY AND DOES NOT CONSTITUTE LEGAL, TAX, OR FINANCIAL ADVICE. PLEASE CONSULT WITH A QUALIFIED TAX ADVISOR FOR SPECIFIC ADVICE PERTAINING TO YOUR SITUATION. FOR MORE INFORMATION ON ANY OF THESE ITEMS, PLEASE REFERENCE IRS REVENUE PROCEDURE 2021-45.
HERE'S A GREAT NEGOTIATING STRATEGY FOR A CHANGING MARKET 1. What is a 2-1 Buydown?A "2-1 Buydown" is where you or the seller pay a fee at the closing to reduce the interest rate on your mortgage by 2% in year 1 and 1% in year 2. This results in temporarily lowering your monthly payment and potentially making the home more affordable for you. A "3-2-1 Buydown" can sometimes also be used, although a 2-1 Buydown is more common. A 3-2-1 buydown is where you or the seller pay a fee at the closing to reduce the interest rate on your mortgage by 3% in year 1, 2% in year 2, and 1% in year 3. 2. What are the benefits of a 2-1 buydown?A 2-1 Buydown reduces your interest rate and monthly payment during the first few years of homeownership, making the home more affordable for you. It can also allow you to benefit from owning a home now so you can start to build equity vs. waiting a few more years and continuing to rent. If the seller pays for the 2-1 Buydown, it would have a much greater impact on your monthly payment than asking the seller to reduce the list price of the home. This could be a great negotiating tool because a greater percentage of homes listed for sale in today's market are seeing price reductions. One way to get maximum benefit with a 2-1 Buydown is to use it on a 5-year or 7-year intermediate term ARM (adjustable rate mortgage). The interest rate on those types of loans is often lower than the interest rate on a fixed-rate loan, resulting in an even lower monthly payment. 3. What happens when the interest rate goes back to normal?In year 3 of a 2-1 Buydown, your interest rate would adjust to its normal "note rate." If market interest rates are the same or higher than they are today, you would just keep the loan and pay the normal payment. However, if a recession happens, as is being predicted by many economists, market rates may come down again. In that case, you may be able to refinance at the then-current rates. Keep in mind that interest rates are cyclical. They tend to go up when the economy is doing well, and they tend to go down when the economy is doing poorly.
INFLATION IS AT DECADES-HIGH LEVELS: HERE'S HOW IT IMPACTS HOUSE PRICES 1. What is inflation?Inflation is when a currency loses its buying power, causing prices in the economy to go up. Year-over-year consumer inflation in the economy has been running around 8.5% throughout the past year. That's the highest inflation rate we've seen since the 1980s. In fact, through much of the past 15 years, annual inflation has been running below 2%. That's why the recent price increases have been such a shock. 2. How does inflation impact house prices?House prices tend to go up along with all the other asset prices in the economy during periods of high inflation. During the last period of high inflation, from 1970 - 1989, the average increase in house prices was 7.64% per year. During the past 20 years of low inflation, from 2000 - 2019, the average increase in house prices was 3.70% per year. House prices tend to go up at a faster pace during periods of high inflation. That's why real estate is often referred to as a "hedge against inflation." 3. How to benefit in a high-inflation environment?The best way to benefit from the current inflation scenario is to buy real estate and use a large mortgage (if you can afford it). That's because the mortgage balance remains the same or goes down as you make your monthly payments, while the property increases in value. The good news is that mortgage rates are still relatively low... lower in fact than the annual inflation rate. This makes buying real estate in this environment even more attractive.
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Isaac Conde
305 West Moana Street Suite C Reno, NV 89509 775-553-8805 B.S. 0143661 ROI
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