I can’t believe how much homes in Reno are going for nowadays! Lately I have been helping a friend look for a home and it appears now close to $300,000 must be spent to afford a starter home (even though the experts say the average price is closer to $250,000, I find this hard to believe). In my recent home viewing experience $300,000 affords a regular 1,900 square foot home, with a small yard and neighbors overlooking this yard. In running the numbers, a purchase price of $300,000 for this starter home equates to a monthly payment of $1,520, which would include putting 20% down or $60,000 at a very low interest rate. I find it hard to believe people who can only afford starter homes can afford this large of a down payment. With a more realistic 5% down, the monthly mortgage payment would be $1,920. According to the industry experts, 30% of gross income is the maximum amount that should be spent on mortgage. At 20%, this would imply a gross income of a minimum of $61,000, and with 5% down an income of $77,000 per year. This is by far in excess of the average household income in Reno of approximately $50,000.
I’m not implying that there is a bubble forming as happened last decade and home prices are going to crash. I just worry that home prices might have increased a bit too much with the 25% gain from just a year ago and closer to 50% from the bottom. I’m waiting for the days when these historically low interest rates go back to levels of those of last decade, which were still historically low. With a rate increase of 1.5% to 5.5% this hypothetical mortgage payment goes from $1,920 to $2,168 which would allow less people to afford the home, if it ever gets sold again. So all I’m saying to my friend is be careful.
When I last made noise on the BVCo. blog I was discussing my search for a cheaper cell phone bill. Well, I finally made a decision. I joined up with Republic Wireless and brought my phone bill down to $25 a month. This is $55 savings from the $80 a month bill I was previously paying. With these monthly savings I will recoup the cost of the new phone in about four months.
Let’s back up a second and I’ll give a refresher (or an introduction if you haven’t glanced at my last blog) as to what Republic Wireless is and what they offer. Republic Wireless is a mobile virtual network operator (MVNO) using the Sprint network. What makes Republic Wireless unique is its use of WiFi calling and standard cell network calling. So, when I’m connected to a WiFi network all my calls and texts are received and delivered over WiFi. It’s a neat concept and is nice when you’re in areas where you have a WiFi connection and no cell coverage or if your cell coverage is just bad.
The real question is, though, how has my experience been with Republic Wireless? It’s been good. The phone (a Moto X) is fantastic, calls and texts over WiFi work great, and the monthly price is completely awesome. I was worried about my out of town coverage, but after traveling to some more rural areas of Nevada I feel pretty good about network coverage. I was actually roaming on the Verizon network, but I was still connected to a network and able to make calls. Ultimately, I just used WiFi networks whenever I was able to and had no problems staying connected.
There are some not so good parts to my experience so far, which was to be expected. The Sprint network has never been my favorite and after being on it for the last month and a half I am no bigger a fan. There are areas in Reno where cell coverage is just horrible. Also, Sprint’s 3G data speeds are ridiculously slow and, unfortunately, Sprint doesn’t have any 4G LTE coverage in the Reno area. One quirk of the Republic Wireless network is it is not able to receive or send short code text messages. These are the shortened numbers you see ads for that say send a text to this number to receive info or coupons. I actually rarely use them, but occasionally I will need to use short codes for online banking verification purposes. There are generally other ways to perform verifications, so not having short code access isn’t a huge deal.
All things considered, my first experiences with Republic Wireless have been overall positive. The phone works, the cell network works (mostly), and I pay much less for service. If you’re looking for a change in your monthly cell phone price, take a peek at Republic Wireless. I think you may find something you like.