The housing market in Reno, NV is strong and growing. If you build a house in Reno, you’ll build equity and this will rise quickly. Within a matter of years, your home value could go up by half (we saw a 20% increase between 2019-2021). The house prices in Reno, NV are higher than the national average and the location is also appealing to tourists.
There are many things to consider before you build a home, especially if you’re moving from another state and/or you’ve never built a home before. If you want to build your first home, heed the following advice before you hire a contractor. We laid out 5 things every new home buyer in Reno should know:
1) Have a goal in mind.
Start out by having an end goal in mind. This should be your vision for what you aim to achieve with the home you’re building. Do you want to raise a family? Do you want to rent it out to tourists? Do you want a vacation home? Do you want an investment property that you can sell a decade later? Maybe you want to go outside the city limits and start your own ranch? Find out what you’re trying to achieve upfront. This way we can help you purchase land appropriately.
For instance, if you’re trying to raise a family with your spouse you might be better off buying land in one of the suburban HOA communities near schools and kindergartens. If you’re trying to build a rental property, you want to stick close to downtown. Once you have a clear goal in mind, you can start purchasing land and getting permits.
2) Set a budget for the home.
It’s important to know what you can afford and buy within your means, otherwise you might get in debt and have to halt the project. The cost to build a home in Reno, NV can exceed the national average because land is scarce and unless you’re willing to go outside the city limits and extend your commute, the land won’t be cheap. You’ll also have to think about the kind of home you want and whether you want to splurge on amenities.
As an experienced Reno, NV home builder we can tell you first-hand that construction costs are surging due to an increase in property prices and construction material costs. The costs for most building materials have surged as much as 200-300% in the last 2 years alone and this increased the average sq. ft. cost from $250-300 to more than $400-500. High-end homes with indoor/outdoor pools and luxury furnishing can cost more than $1,000/sq. ft. on average.
Once you know how what you want to build, you can visit a lender and find out the maximum you and your spouse can afford without being overleveraged. The initial purchase might be expensive, but you’ll build equity later down the line which will certainly turn out to be a solid investment over the long term.
3) Negotiate a building timeline.
Consult a home builder in Reno, NV to get a quote and find out how fast they can construct the house. The timeline for construction should be predictable because you want to move in by a certain deadline, instead of waiting years on end for your home to be constructed. If you’re ready to pay the builder upfront, you can negotiate a certain timeframe in which they’re obliged to finish the project. The average new home builds in Reno NV take around 6-7 months to construct (until you’re ready to move in).
4) Obtain building permits.
The building company can help you obtain licenses and explain what you need to do to get a permit. A building permit can take up to a few months to obtain which is why you want to apply as soon as possible.
Once the builder is allowed to work on your land, they will bring a construction crew and lay the foundations. As mentioned, most homes are ready in less than half a year but if you add permits to the equation it should take a year on average.
5) Learn about taxes and management fees.
The final step is to integrate yourself in your new community. Learn about local property taxes to know how much you owe to the municipality and avoid penalties. Many communities in Reno are HOA communities and you’ll have to set aside a small payment every month. The HOA fees go into landscaping, security, construction, and other community services.