It’s been a rough five and a half years for the American homeowner. Since the housing bubble reached its peak in early 2007, Americans have watched helplessly as $7 trillion in housing wealth evaporated. At many points during this ugly plunge, pundits have erroneously called the “bottom” of the housing market – saying things could finally get no worse. And then they got worse.

The American public can therefore be forgiven for eyeing the latest round of predictions that the market has turned a corner with skepticism. Of course, the housing market will heal at some point, so perhaps the boy is crying about an actual wolf this time.

The best reason to shed your hard-won dubiousness is a report issued today by the The Demand Institute, a think tank jointly operated by the well-respected and non-partisan research organizations The Conference Board and Nielsen. The fifty-page study is definitively labeling 2012 the year of the housing bottom. It says:

“The double-digit increases in U.S. housing prices over the first half of the past decade proved unsustainable. But the freefall is over. The point has been reached where housing prices will start to climb, albeit at single-digit rates in most markets over the next five years.”

The report argues that the recovery will come in two stages. The first will be driven by rental demand. Over the past several years plummeting home prices have been coupled with rising rents, and this dynamic has made landlording very profitable. This is evidenced by the recent rebound of the apartment-building business. According to the report, “The only segment of the home building sector now showing clear signs of recovery is multifamily housing,” noting that housing starts for multi-family units have increased 54 percent in 2011 over the previous year.

(MORE: Is Freddie Mac Betting Against the American Homeowner?)

The Demand Institute also believes the dynamics buoying the multifamily market — rising rents, low interest rates, and cheap real estate — are starting to boost the single-family housing sector as well: “Investors attracted by high yields are buying up single-family properties that can generate rental income.”

So who are these investors? Lousie Keely, Chief Research Officer at The Demand Institute, says that there are range of different companies and individuals who are poised to take advantage of the situation. “In some regions of the country, rental management companies are moving into single-family homes,” she says. Though managing single-family homes isn’t as efficient as managing an apartment building, current prices are making the strategy attractive. Buyers will also include individuals looking for higher yields on their savings as well as investment vehicles like real estate investment trusts.

The second stage of the recovery will occur after this investor intervention causes prices to stabilize. Price stabilization is crucial for banks to loosen their stingy lending standards. When home prices are falling, it’s bad business to issue mortgages to all but the most credit-worthy borrowers. But in an environment of even slowly appreciating real estate, banks can afford to offer more generous terms.

Perhaps most crucial to The Demand Institute’s vision for a recovering housing market is evidence that Americans are still strongly attracted to the idea of homeownership. “The American Dream has not gone away,” says Keely, adding:

“The majority of Americans think that owning a home is a good investment; the majority of people who plan to move in the next six years plan to buy a house even if they’re not currently homeowners. There are several pieces of evidence that lead us to believe that we’ll see a rise back to home ownership levels that we saw in the mid ’90s and early 2000s.”

Though American consumers have too much debt and probably won’t see their incomes rise in real terms in the next few years, Keely argues that homeownership is still an achievable goal if lending standards loosen and if consumers stay disciplined about paying down debt and saving.

There are of course caveats attached to these predictions. The report relies on Conference Board forecasts which call for slow but steady growth and a similarly gradual decline in the unemployment rate. If the situation in Europe were to worsen significantly, or some other unforeseen event were to shock the American economy, then these forecasts will turn out to have been too optimistic. But even with such stipulations, The Demand Institute’s report is one of the most comprehensive and substantive arguments we’ve seen yet that the housing market is nearing the light at the end of the tunnel.

Read more: http://business.time.com/2012/05/15/report-housing-market-recovery-has-officially-begun/#ixzz1v3MnhFRt

Suzanne Shelton: Yes, for many of us, even though we may think our energy use is going down.

HL: How come?

SS: Energy is the only product we buy on a daily basis where we have no idea how much we pay for it. It would be different if we had to feed dollars into a machine to make the power run in our homes.

The way we use energy now is the equivalent of walking into a convenience store every day and filling our pockets with candy and walking out. Then the bill comes at the end of the month and we’re saying, “There’s no way I ate that much candy!”

This is an inherent problem with the way we use energy, or it will be, at least, until we live like the Jetsons and have nifty energy dashboards in our homes.

HL: Why are we using more energy now — what are the main culprits? 

SS: Several things. We simply have more stuff plugged in now than we did five or 10 years ago — Xboxes, electronics chargers, iPads — and some of those things are energy hogs.

For example, plasma TVs use as much energy as a refrigerator. They’re getting more efficient now, but if you had the old square CRT and replaced it with a flat-screen plasma, you’re instantly paying the utility much more than you did before.

People are buying an Energy Star refrigerator, but then putting the old one in the garage as a beer fridge. For example, a friend of mine was in the process of selling her house. She wasn’t living there and she had the HVAC turned off, but she had an old refrigerator inside, plus a freezer plugged in on the back porch. Her utility bill came in at $50 a month and she was furious. “I’m never there!” she said. “The lights are off, the heat’s off, how can this be right?”

I said, “Are your appliances plugged in?” And so she unplugged the freezer and her refrigerator inside. It cut her bill in half.

HL: Do we also think that if we’re saving energy in one way, we can use more of something else?

SS: Yes. People tell us in focus groups, “I bought these CFLs so now I can leave the lights on and not pay more. I bought a high-efficiency washer and dryer because I want to do more laundry without paying more. I ate the salad, so I can have the chocolate cake.”

Psychologists call it “moral licensing,” but we at Shelton Group call it the “Snackwells Effect,” as in, they’re low-fat, so I can eat all of them.

HL: What’s the reason for this disconnect?

SS: Most of us have no idea how our homes really work, so we don’t know how to make the biggest impact. That’s why consumers run out and replace their windows first, when that should probably be fifth or sixth on the list of energy-efficient improvements to make, and they totally ignore effective activities like caulking and sealing that cost far less. 

HL: I’m surprised people replace their windows first.

SS: The aesthetic draw of new windows is really strong; we love to be around pretty things. You can also talk yourself into it because you think it’ll improve your resale value. But more than that, if you put your hand up to a window, even an energy-efficient window, you can feel that it’s hot or cold, so people just assume that’s where the biggest problem is.

But for the average home owner, new windows aren’t the best use of your home improvement dollar in terms of saving money on your energy bills. Everyone’s situation is different, but other projects usually cost far less and offer a faster return on your investment.

HL note: Consider this: If you spend $12,000 on windows and save 7% to 15% on your energy bill, according to Department of Energy data, when you could have spent around $1,000 for new insulation, caulking, and sealing and saved 20% on your energy bill, you made the wrong choice if your only reason for undertaking the project was reducing energy costs.

Read more: http://www.houselogic.com/blog/whats-really-green/energy-savings-at-home/#ixzz1siwD7l42

Take Control of Your Life

You wouldn’t drive your car without checking all the internal gauges and determining your destination, so why would you lead your life that way? If you let life happen to you and you’re just a passenger along for the ride, you have given away your control! Take it back by grabbing the steering wheel, plunking down into the driver’s seat and taking a serious look at where you’re headed. SUCCESS experts tell you how:

Best-selling author John C. Maxwell:
List your core beliefs.
Then abide by your core beliefs each day, and refuse to be swayed by outside factors and influences. These become the tenets of your life that will ultimately deliver a fulfilled existence.

Compile a daily-dozen list you adhere to each day.
Your list should include the most important values and goals that will be influential in shaping your life and achieving your successes. Ideally, this list should be a basic outline of how you want to live as a person and what you want to achieve. If you refer to your list each day, it will help you stay on course.

Motivational coach and author Denis Waitley:
Know the person in the mirror.
Quality of life begins with self-assessment, and is about the fulfillment and joy we experience every day—not someday, or during vacations or retirement.

Keep a close check on what you are exposed to most.
You are not only what you eat, but through repetition you become what you watch, read, listen to and internalize.

Set benchmarks to see if you are making progress.
Throughout the day, frequently ask yourself: Is this activity moving me forward to achieve my most important lifetime goals?

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