One problem the industry faces is the lack of standards defining what’s green and what isn’t. To help clarify green guidelines, Target is creating what it calls a “cross-functional team” to evaluate sustainable products and procedures.

Small designers who originated the movement are skeptical that major retailers can truly offer products that are sustainable at such low price points. What these retailers are offering “appears to be 90 percent marketing and 10 percent a real exploration of concrete advances in materials and production techniques,” says Jesse Johnson, CEO of Q Collection, whose all-green line includes a $7,000 bookcase.

Source: BusinessWeek Online, Ernest Beck (11/06/2007)

Personal memorabilia (including college memories)
- Sports/Golf
- Vintage items (cars, tools, photos)
- Animal or nature motif.

No wonder Mom is the decorator. Happy Father’s Day, you big lug!

More Homebuyers Turn to Parents for Help
With many first-time and even move-up buyers strapped for down-payment cash, an increasing number of parents are helping their grown children buy a home — and taking an equity share in return.

Typically, parents put in cash to help the buyers amass a down payment of at least 20 percent. That allows buyers to qualify for a conventional 30-year fixed-rate mortgage. The equity sharers get back their initial stake plus 10 percent to 50 percent of the profits.

Generally, a written contract spells out that the home owners are responsible for mortgage payments and get the tax deduction that comes with it. The contract also specifies who pays the property taxes — often that’s a 50-50 split. In some cases, the parent’s name is on the loan. In others, it isn’t.

Economist Andrew Caplin of New York University and a number of other experts are designing standardized shared-equity mortgages that would allow outside investors to buy a piece of the equity gain. Caplin estimates that about 25 percent of first-time homebuyers could find such arrangements attractive. One thing is certain: Investors in it for the money will extract stiffer terms than mom or dad.

Source: Business Week, Christopher Farrell (04/23/07)

 For the full article and analysis with charts,go to this link on the NVAR website. http://www.nvar.com/newsdetail.lasso?articleno=nvarn100813. Even if you don’t feel like digesting a whole article, the 3 charts really tell the story.

New Rules for Buying a Home Before It’s Built
As the housing market has cooled, the developer’s mindset has changed. Rather than construct new developments quickly and wait for the buyers to flood in, more developers are relying on preconstruction sales to determine whether or not to break ground.

Here’s some advice for any buyer contemplating a preconstruction purchase:

• Negotiate an exit strategy in your sales contract, especially as lead times for construction grow longer in some markets. For example, state that if the builder doesn’t break ground by a certain day, you can get out of the contract.
• If you’re deposit money is going to sit there for an extended period, as the developer to pay interest.
• Get in writing what changes that can be made to the project once the sales contract is signed. Finishes and appliances might not be set in stone at the time you sign the deal.
• Try to find out the current state of the local market and gauge whether the developer is offering incentives to lure new buyers – which, though attractive to buyers in the short term, can put a downward pressure on prices.

Second Mortgages Spell Trouble for Borrowers
Having a second mortgage puts home owners at a greater risk of foreclosure, but that doesn’t stop banks from giving them to borrowers.

A 2006 study by Standard & Poor’s, which analyzed 640,000 mortgages with second liens, found that these borrowers are 43 percent more likely to go into default than those who have similar loans but no second mortgage.

With this in mind, Business Week magazine recently asked First American LoanPerformance, mortgage data and risk firm, to analyze a sampling of loans banks had granted in the fourth quarter of last year.

LoanPerformance found that within months of getting an original mortgage, more than 50,000 of 169,000 borrowers had applied for more money or tapped a home equity line of credit, pushing their loan-to-value ratio to 95 percent or greater.

Big financial institutions are in the dark about borrowers who have come back to them for another loan, says Max Doubek, director of analytics at First American, because home equity lines of credit and first mortgages are often granted by separate departments that don’t communicate with each other. “They might as well be different companies.”

Source: Business Week, Mara Der Hovanesian (04/02/2007)

People don’t want to clean, Gutherlet says, so products like ceramic cooktops are increasingly popular, and he predicts induction cooking where heat is generated in the pan not in the stove will be the next big things.

“You have a cooktop that you can put your hand on after two or three minutes. It’s very convenient for cleaning,” he says.

Another trend is consumer willingness to pay for energy efficiency. “Just look at the front-loading [washing machine]. It’s amazing. Nobody thought this very traditional top-loader market would switch so fast.”

Source: The Charlotte Observer, Nichole Monroe Bell (03/27/2007)