Is granite safe?

 

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July 24, 2008

What's Lurking in Your Countertop?

By KATE MURPHY

SHORTLY before Lynn Sugarman of Teaneck, N.J., bought her summer home in Lake George, N.Y., two years ago, a routine inspection revealed it had elevated levels of radon, a radioactive gas that can cause lung cancer. So she called a radon measurement and mitigation technician to find the source.

"He went from room to room," said Dr. Sugarman, a pediatrician. But he stopped in his tracks in the kitchen, which had richly grained cream, brown and burgundy granite countertops. His Geiger counter indicated that the granite was emitting radiation at levels 10 times higher than those he had measured elsewhere in the house.

"My first thought was, my pregnant daughter was coming for the weekend," Dr. Sugarman said. When the technician told her to keep her daughter several feet from the countertops just to be safe, she said, "I had them ripped out that very day," and sent to the state Department of Health for analysis. The granite, it turned out, contained high levels of uranium, which is not only radioactive but releases radon gas as it decays. "The health risk to me and my family was probably small," Dr. Sugarman said, "but I felt it was an unnecessary risk."

As the popularity of granite countertops has grown in the last decade - demand for them has increased tenfold, according to the Marble Institute of America, a trade group representing granite fabricators - so have the types of granite available. For example, one source, Graniteland (graniteland.com) offers more than 900 kinds of granite from 63 countries. And with increased sales volume and variety, there have been more reports of "hot" or potentially hazardous countertops, particularly among the more exotic and striated varieties from Brazil and Namibia.

"It's not that all granite is dangerous," said Stanley Liebert, the quality assurance director at CMT Laboratories in Clifton Park, N.Y., who took radiation measurements at Dr. Sugarman's house. "But I've seen a few that might heat up your Cheerios a little."

Allegations that granite countertops may emit dangerous levels of radon and radiation have been raised periodically over the past decade, mostly by makers and distributors of competing countertop materials. The Marble Institute of America has said such claims are "ludicrous" because although granite is known to contain uranium and other radioactive materials like thorium and potassium, the amounts in countertops are not enough to pose a health threat.

Indeed, health physicists and radiation experts agree that most granite countertops emit radiation and radon at extremely low levels. They say these emissions are insignificant compared with so-called background radiation that is constantly raining down from outer space or seeping up from the earth's crust, not to mention emanating from manmade sources like X-rays, luminous watches and smoke detectors.

But with increasing regularity in recent months, the Environmental Protection Agency has been receiving calls from radon inspectors as well as from concerned homeowners about granite countertops with radiation measurements several times above background levels. "We've been hearing from people all over the country concerned about high readings," said Lou Witt, a program analyst with the agency's Indoor Environments Division.

Last month, Suzanne Zick, who lives in Magnolia, Tex., a small town northwest of Houston, called the E.P.A. and her state's health department to find out what she should do about the salmon-colored granite she had installed in her foyer a year and a half ago. A geology instructor at a community college, she realized belatedly that it could contain radioactive material and had it tested. The technician sent her a report indicating that the granite was emitting low to moderately high levels of both radon and radiation, depending on where along the stone the measurement was taken.

"I don't really know what the numbers are telling me about my risk," Ms. Zick said. "I don't want to tear it out, but I don't want cancer either."

The E.P.A. recommends taking action if radon gas levels in the home exceeds 4 picocuries per liter of air (a measure of radioactive emission); about the same risk for cancer as smoking a half a pack of cigarettes per day. In Dr. Sugarman's kitchen, the readings were 100 picocuries per liter. In her basement, where radon readings are expected to be higher because the gas usually seeps into homes from decaying uranium underground, the readings were 6 picocuries per liter.

The average person is subjected to radiation from natural and manmade sources at an annual level of 360 millirem (a measure of energy absorbed by the body), according to government agencies like the E.P.A. and the Nuclear Regulatory Commission. The limit of additional exposure set by the commission for people living near nuclear reactors is 100 millirem per year. To put this in perspective, passengers get 3 millirem of cosmic radiation on a flight from New York to Los Angeles.

A "hot" granite countertop like Dr. Sugarman's might add a fraction of a millirem per hour and that is if you were a few inches from it or touching it the entire time.

Nevertheless, Mr. Witt said, "There is no known safe level of radon or radiation." Moreover, he said, scientists agree that "any exposure increases your health risk." A granite countertop that emits an extremely high level of radiation, as a small number of commercially available samples have in recent tests, could conceivably expose body parts that were in close proximity to it for two hours a day to a localized dose of 100 millirem over just a few months.

David J. Brenner, director of the Center for Radiological Research at Columbia University in New York, said the cancer risk from granite countertops, even those emitting radiation above background levels, is "on the order of one in a million." Being struck by lightning is more likely. Nonetheless, Dr. Brenner said, "It makes sense. If you can choose another counter that doesn't elevate your risk, however slightly, why wouldn't you?"

Radon is the second leading cause of lung cancer after smoking and is considered especially dangerous to smokers, whose lungs are already compromised. Children and developing fetuses are vulnerable to radiation, which can cause other forms of cancer. Mr. Witt said the E.P.A. is not studying health risks associated with granite countertops because of a "lack of resources."

The Marble Institute of America plans to develop a testing protocol for granite. "We want to reassure the public that their granite countertops are safe," Jim Hogan, the group's president, said earlier this month "We know the vast majority of granites are safe, but there are some new exotic varieties coming in now that we've never seen before, and we need to use sound science to evaluate them."

Research scientists at Rice University in Houston and at the New York State Department of Health are currently conducting studies of granite widely used in kitchen counters. William J. Llope, a professor of physics at Rice, said his preliminary results show that of the 55 samples he has collected from nearby fabricators and wholesalers, all of which emit radiation at higher-than-background levels, a handful have tested at levels 100 times or more above background.

Personal injury lawyers are already advertising on the Web for clients who think they may have been injured by countertops. "I think it will be like the mold litigation a few years back, where some cases were legitimate and a whole lot were not," said Ernest P. Chiodo, a physician and lawyer in Detroit who specializes in toxic tort law. His kitchen counters are granite, he said, "but I don't spend much time in the kitchen."

As for Dr. Sugarman, the contractor of the house she bought in Lake George paid for the removal of her "hot" countertops. She replaced them with another type of granite. "But I had them tested first," she said.

Where to Find Tests and Testers

TO find a certified technician to determine whether radiation or radon is emanating from a granite countertop, homeowners can contact the American Association of Radon Scientists and Technologists (aarst.org). Testing costs between $100 to $300.

Information on certified technicians and do-it-yourself radon testing kits is available from the Environmental Protection Agency's Web site at epa.gov/radon, as well as from state or regional indoor air environment offices, which can be found at epa.gov/iaq/whereyoulive.html. Kits test for radon, not radiation, and cost $20 to $30. They are sold at hardware stores and online.

 

 

Great College Park Condo

Relocating Seller wants offer today. 12th floor efficiency condo with built-in bookcases overlooks Greenbelt Park and Courtyard. Seller will help with down payment and closing costs if needed! Secure building offers 24-hour desk attendant. Condo fee includes water,gas & electricity. Pool, sauna, exercise room and party room available. Convenience store on premises as well as Metro & UMCP shuttle bus. 5 minutes from University of Maryland, NASA Godard, Metro Station, BWI, I-95 and BW Parkway. 15 minutes from Walter Reed, Fort Meade, Naval Hosp., NIH, Washington D.C. (White House and the US Capitol).

Bank of America wins approval to buy Countrywide

By IEVA M. AUGSTUMS, AP Business Writer 5 minutes ago CHARLOTTE, N.C. -

The Federal Reserve on Thursday approved Bank of America Corp.'s purchase of distressed subprime mortgage lender Countrywide Financial Corp. ADVERTISEMENT In a statement, the federal regulatory said it considered many comments for and against the company buyout and "has considered carefully the financial factors of the proposal." Charlotte-based Bank of America, which announced its $4 billion acquisition of the Calabasas, Calif.-based mortgage lender in January, has faced much criticism for Countrywide's large exposure to subprime home loans that were offered to borrowers despite their shaky credit. Countrywide lost about $1.6 billion in the last six months of 2007, and the company faces numerous investigations and lawsuits related to its lending practices. Bank of America has said it will tighten those lending standards. "This transaction represents a rare opportunity for Bank of America to significantly gain market share in the mortgage business, allowing it to expand in a cornerstone financial product," Bank of America Chairman and Chief Executive Officer Ken Lewis said in a statement commenting on the Fed decision. In its order, the Fed board said that after the proposed deal Bank of America would remain the largest depository institution in the country, controlling approximately $773.4 billion in deposits, which represent 10.9 percent of total insured bank deposits in the country. When the deal was first announced, Bank of America said it would pay about $4 billion in an all-stock deal for Countrywide, exchanging 0.1822 shares of Bank of America for each share of Countrywide outstanding. In recent months, some analysts have speculated that the deal may be completed at a lower price because of further deterioration in the mortgage market and a continued rise in mortgage delinquencies and defaults. Experts have said that the deterioration of the mortgage market and Countrywide's loan portfolio could lead to costly write-downs and create a drag on Bank of America's earnings. But on Monday, Lewis told analysts on a conference call that he believed buying Countrywide was still a good deal even though the housing market had continued to falter since the deal was announced. Lewis said he believed that housing conditions would improve by early next year. He said that Countrywide and its professional sales force would give the bank a boost as it pushes to increase market share in the mortgage sector. Bank of America said it expects the sale to close in the July-September quarter. The Fed board approved the deal in a 32-page order issued Thursday. Countrywide had said previously that it will hold a special meeting of shareholders on June 25 to approve the proposed sale. ___ AP Economics Writer Martin Crutsinger in Washington contributed to this report.

Top Rated Wireless Carriers

The Tech Blog Verizon tops in wireless survey, Sprint falls behind Wed May 21, 2008 3:35PM EDT Buzz up!on Yahoo!Chatters are growing happier with their overall wireless service, according to a new survey, with Verizon Wireless taking top honors and Sprint slipping into last place among the four big carriers. That said, overall scores for customer satisfaction fell somewhat short of the stratosphere. The results come courtesy of the American Customer Satisfaction Index, which rates various industries and companies on a scale of 1 to 100 based on national phone surveys. The scores? Overall wireless service garnered a 68, the highest score in the four years that the index has been tracking wireless satisfaction—not bad, but not exactly what I'd call an A+. Verizon Wireless scored a 72 in the survey, giving it top marks among the four big wireless carriers. AT&T and T-Mobile both tied at 71, with AT&T gaining the most ground thanks to its four-percent spike since 2007 (thanks, in part, to the iPhone, according to ACSI researchers). Meanwhile, Sprint's ACSI rating fell to just 56, an 8 percent drop from last year. What happened? Well, the struggling carrier's decision to slash 5,000 jobs last year—with another 4,000 to come—could have something to do with it, ACSI researchers said. Just for comparison's sake, the spiraling airline industry got an ACSI score of 62 (tumbling almost 14 percent from 1994), the U.S. Postal Service got a 74 (up from a score of 61 in 1994), FedEx scored an 85, and both McDonald's and Microsoft made do with a middling 69. How's your carrier been treating you lately? Care to grade 'em on your own scale of 1 to 100? Fire away!

County Council Raises Property Taxes in MC

Montgomery Passes Budget That Raises Taxes

By Ann E. Marimow
Washington Post Staff Writer
Thursday, May 22, 2008; 1:17 PM

 

With little discussion, Montgomery County Council members this morning gave final approval to a $4.3 billion budget that will bring property tax increases of about 13 percent for the average homeowner and raise energy taxes by about $10 a year for the average household.

Faced with slowing revenue from a weakened housing market, the council voted unanimously to exceed Montgomery's charter limit on property tax revenue for only the fourth time since the cap was approved by voters in 1990.

The council kept the rate at the current level rather than raising it by 7.5 cents as County Executive Isiah Leggett had suggested. But the bill for the median-priced home will still increase $316, or 14.3 percent, to $2,520, because of rising property assessments.

To ease the hit on homeowners, the council also approved a $579 credit for primary residences.

"This budget is a product of bad economic times and required compromises, which doesn't make for an optimal result, just a necessary one," said council member Roger Berliner (D-Potomac-Bethesda).

For days, the council was deeply divided over whether to revise labor union contracts that provide most government workers with raises of 8 percent. In the end, a compromise left contracts untouched, but requires an additional $16 million in cuts to be evenly divided between county government and school system operations.

Overall spending will increase 4.3 percent, the smallest annual increase in at least 12 years. Funding for the public schools will rise 4.1 percent, a smaller increase than the system requested but $10 million more than Leggett recommended.

Turn $451 a month into a Million Bucks

Turn $451 a Month Into a Million Bucks

<script type="text/javascript" src="http://fe.shortcuts.search.yahoo.com/script?fr=csc_fin_pf"></script> Tuesday, May 13, 2008provided by

<script type="text/javascript"></script> If you're 30 years old, you need to set aside $448 per month for next 35 years to become a millionaire -- if you earn a reasonable 8% annualized return in a retirement account. Don't have $448 to spare -- or even $248? Maybe you do and don't realize it. Let's take a look at how you can come up with the cash.

Save $219 Per Month on Taxes

Here's How: The average refund for the 2008 filing season so far is about $2,500. If you received an average refund and you are in the 25% federal tax bracket, you could be entitled to three extra exemptions worth $3,500 each. That would boost your take-home pay by $219 a month. A couple of reasons you might be eligible for more exemptions: becoming a new parent or buying a house.

Save $100 Per Month on Food

Here's How: Bring your lunch and snacks to work. Considering that the average meal at McDonald's costs $5 and Dunkin' Donuts charges $2 for a large cup of coffee, the brown-bag windfall can be substantial.

Save $80 Per Month on Entertainment

Here's How: We're talking about one fewer dinner-and-a-movie night every month. That assumes you and your significant other pay the average $33 per person for a restaurant meal (according to a recent Zagat survey) and that you spend $7 per ticket, the average price at the movies (according to the Motion Picture Association of America).

Save $28 Per Month on Health Care

Here's How: The typical family spends $1,321 on out-of-pocket health expenses each year, says the U.S. Department of Health and Human Serv­ices. You can pay those costs with a flexible spending account, which lets you set aside pretax dollars.

Save $10 Per Month on Auto Insurance

Here's How: The average consumer pays $829 annually for car insurance, according to the National Association of Insurance Commissioners. Raising your deductible from $250 to $1,000 can save you 15% or more.

 

Save $8 Per Month on a Well Maintained Car

Here's How: Keep your car's engine tuned and tires inflated to the proper air pressure. Those minor improvements can save you up to $100 on gas each year.

Save $6 Per Month on Generic Non-Prescription Medicines

Here's How: The average American spends $185 annually on over-the-counter medications. Generics cost up to 40% less than their brand-name counterparts and work just as well.

$451 Saved in Total!

Invest the found money every month in a retirement account that earns an average of 8% return over the next 35 years, and you'll have $1 million. That wasn't too hard, right?

Copyrighted, Kiplinger Washington Editors, Inc.

The Brighter Side of Housing

The Brighter Side of Housing

<script type="text/javascript" src="http://fe.shortcuts.search.yahoo.com/script?fr=csc_fin_pf"></script> by James R. Hagerty
Friday, April 25, 2008provided by

<script type="text/javascript"></script> Amid Downturn, 'Unaffordable' Is Within Reach

And now for the heartwarming side of the housing bust: It's helping some people buy homes that they couldn't afford a couple of years ago.

Michelle Dudley for years commuted 50 miles each way to her job as a civil servant in Anaheim, Calif., because she and her husband, Don, didn't feel they could afford a home near her office. This week, though, the Dudleys moved into a three-bedroom house in Anaheim that they recently bought for $390,000, down from the original listing price of $445,000 in November. Similar homes in the area were selling for as much as about $600,000 two years ago, says Erin Eckert, an agent for Redfin, an online real-estate brokerage that represented the Dudleys.

More from WSJ.com: · Drinks? DJs? See Realtor Inside · My $1,200 Radon Job • Moving Out Ahead of the Demolition Brings Sadness, Joy

Still, many potential buyers are holding out for better deals. The Wall Street Journal's quarterly survey of housing-market conditions in 28 major metro areas points to continued downward pressure on prices in much of the country.

As usual, there is huge variation from town to town. In most of the country, inventories of unsold homes are no longer growing quickly, as they did in 2006 and 2007, but remain huge. The supply has shrunk modestly in Boston and Denver over the past year. But the number of for-sale signs continues to rise swiftly in the Portland, Ore.; Seattle; Raleigh-Durham, N.C.; San Francisco; and Washington areas.

The biggest gluts are in Florida. In the Miami-Fort Lauderdale area, the supply of single-family homes and condominiums is enough to last 34 months at the average sales rate of the past year. That months-supply figure is about 21 in Orlando, 18 in Tampa and Las Vegas, 17 in Detroit and 14 in Phoenix. A six-month inventory is generally considered a rough balance between supply and demand.

For condos alone in Miami-Dade County, the supply would last 45 months at the current sales rate.

Prices are coming down fast. Real-estate data company Zillow.com estimates that the median value for all homes in the 12 months ended March 31 fell 25% in the Las Vegas metro area, 19% in Miami and Orlando, and 16% in Phoenix. The typical value is still rising modestly in a few places, including the metro areas of Raleigh and Charlotte, N.C., Dallas and Houston. One hitch for house hunters, though, is that mortgage lenders have become much more restrictive with loans. And even buyers who can get financing still face a tricky question: Should I wait for a lower price? Buying now, with home prices generally falling, is "a gamble," says Ms. Dudley, who just moved into her new Anaheim home. But, she says, home prices will rise again at some point. Meanwhile, she was tired of her long, expensive commute.

See a sortable chart of housing data

Kevin McCleary, a computer-security consultant, remained a renter through the housing boom even though he could afford to buy, because he believed prices were reaching unsustainable levels. In October, though, he and his fiancée finally decided to buy a foreclosed home in Herndon, Va., and negotiated a price of about $443,000. The same home sold in 2005 for $645,000. "I don't believe we hit it at the perfect time," Mr. McCleary says. On the other hand, he says, "we were just tired of putting our lives on hold."

During the boom, home prices rose far faster than incomes. Home prices as measured by the S&P/Case-Shiller national index shot up 74% in the six years through 2006, while median household income rose 15%. (Neither figure is adjusted for inflation.) Now prices in many areas are adjusting back toward more affordable levels, a process that could take several years.

In an analysis of 330 metro areas in last year's fourth quarter, National City Corp., a banking concern, and Global Insight, an economic research firm, found that home prices were sharply overvalued in relation to household income and other factors in 21 metro areas, down from a peak of 58 metro areas in the second quarter of 2006.

Economists at the two firms look at home prices in relation to household income and other variables, including population density (an indication of how much land is available) and past differences in prices caused by factors like climate and schools. They then classify as "overvalued" metro areas where home prices are more than 33% above a level that could be explained by fundamental drivers of housing costs. Among areas where this analysis finds that home prices are still too high are Bend, Ore., Atlantic City, N.J., Miami, Honolulu and Portland, Ore.

In most of the country, "we're getting a return to normalcy" in the relation between home prices and incomes, says Richard DeKaser, chief economist at National City. But, he adds, prices may overshoot on the down side.

Economists at Goldman Sachs say home prices are likely to level off by late 2009. They also point to improving affordability. Goldman's chief U.S. economist, Jan Hatzius, says the share of a typical family's income needed to pay mortgage payments on a median-priced home averaged about 17.5% from 1993 to 2003, before jumping to 26% in 2006. The figure now has fallen to 20% and is likely to keep declining as home prices fall.

Mr. Hatzius estimates that average U.S. home prices have fallen 15% since the second quarter of 2006 and projects they will fall an additional 10% before stabilizing late next year. But he also sees a risk that home prices will fall further, particularly if the foreclosure problem proves worse than already expected.

Goldman estimates that foreclosures will add 1 million to 1.5 million homes to the for-sale market this year, compared with less than half a million a year before 2007.

During the first quarter, homes acquired by lenders through foreclosure accounted for 33% of all sales of previously occupied homes in California, up from just 3.2% a year earlier, according to DataQuick Information Systems, a research firm in La Jolla, Calif.

Homeowners hoping to avoid a foreclosure are adding to downward pressure on the market, says Daniel R. Odio, owner of DROdio Real Estate Inc. in Alexandria, Va. Such people often seek to unload their homes through a "short sale," in which the price is less than the amount owed on the mortgage and the lender agrees to forgive the difference. Homeowners hoping to do a short sale sometimes advertise very low asking prices to lure buyers, even if there is little chance the lender would accept bids at that level, Mr. Odio says. The "fictional" asking price, in turn, misleads potential buyers about the value of nearby homes.

The supply of lower-priced homes has surged in some areas. Steven Thomas, president of Re/Max Real Estate Services in Aliso Viejo, Calif., says there are about 1,260 condos available for under $250,000 in Orange County, Calif., or about triple the year-earlier total.

Write to James R. Hagerty at bob.hagerty@wsj.com

Copyrighted, Dow Jones & Company, Inc. All rights reserved.

Eight Ways to Cut Summer Energy Bills

Eight Ways to Cut Summer Energy Bills

<script type="text/javascript" src="http://fe.shortcuts.search.yahoo.com/script?fr=csc_fin_pf"></script> by Stephanie AuWerter
Friday, May 9, 2008provided by

With summer finally kicking into gear across the country, you can almost hear the gentle hum of air conditioners ratcheting up. And with it, climbs home energy bills.

These days, the average household spends $1,900 annually on energy (based on electricity and gas usage), according to the Environmental Protection Agency (EPA). But much of that, say energy conservationists, is money wasted.

The good news: Cutting back doesn't mean you need to be a tree-hugging naturalist, suffering stoically as you read by candlelight. These days, you can do right by the environment and your pocketbook-without any major lifestyle sacrifices. In fact, by taking some relatively painless steps, you can cut your bills by one-third or more.

More from SmartMoney.com: · 13 Simple Ways to Lower Your Electric Bill · 7 Energy-Saving Eco-Gadgets • 8 Ways to Cut Your Grocery Bill

Here are eight easy ways to save this summer (including a few tips that will work year-round).

1. Upgrade Your Thermostat

Are you the type who likes to chill after a sticky workday by coming home to a house that's as cool as a meat locker? You can live this dream and cut your energy costs by investing in a programmable thermostat. These handy little devices allow you to cool your home at different temperatures at specific times.

So you could, for example, turn down the AC during the day, when your family is away from home-and crank it up again 30 minutes before the first family member returns. Or, you could turn it down during the wee hours of the morning, when no one's likely to notice a shift in temperature.

Installing a programmable thermostat shouldn't set you back more than $100 to $150-and the energy savings can be substantial. According to the U.S. Department of Energy (DOE), you could cut your heating and cooling bills by 10% annually just by turning your thermostat back 10% to 15% for 8 hours a day.

2. Go Green

Ok-this will require a bit of effort on your part, but the returns are twofold: Planting just three shady trees around your house not only can whack $100 to $250 off your annual heating and cooling costs, according to the DOE, but will most likely make your yard more attractive, to boot. (Leafy trees can shield the house from direct sunlight, keeping temperatures down, while still permitting sunlight to hit your house during the winter months.)

Not interested in nurturing your green thumb? Simply pulling the shades (or drawing your curtains) can cut energy costs as well, says Mel Hall-Crawford, an energy efficiency expert at the Consumer Federation of America.

3. Keep It Clean

Keeping your air-conditioning unit clean and in peak performance is another big money saver. To kick the summer off, your AC unit should have a professional tune up (expect to pay somewhere between $90 and $120), says Maria Vargas, an Energy Star spokesperson at the EPA. (Energy Star is a joint program run by the EPA and the DOE that, among other things, deems certain products energy-efficient.) And air-conditioning filters (regardless of whether you have central air or an individual unit) should generally be checked every month or so to see if they need cleaning or replacement. This is something you should be able to do on your own.

Another item to add to your spring cleaning list: Dusting off your refrigerator condenser coils, says Hall-Crawford. This will make the unit run more efficiently.

4. Buy a Better Bulb

Compact fluorescent light bulbs (called CFLs) require 75% less energy than traditional (officially called incandescent) light bulbs, and last up to 10 times longer, according to the ASE. Be sure to look for CFLs with the Energy Star label, since these bulbs won't have any buzzing or humming problems, promises Energy Star's Reed. These bulbs now come in smaller sizes (called subcompacts) that can fit into any lamp, and they have a wider color spectrum. According to the Alliance to Save Energy (ASE), replacing just four well-used 100-watt incandescent bulbs with equivalent 23-watt CFLs will save you $120 to $200 over three years.

Also, do you still have one of those halogen lamps leftover from your college days? (You know-those tall lamps that didn't cost much more than a couple of pizzas to buy?) Do yourself a favor: Dump it. Not only are these dangerous fire starters, but their bulbs, which can generate temperatures of 700 to 1,100 degrees Fahrenheit, are energy hogs as well, says Vargas. That makes them considerably less inexpensive than they seemed back in the day.

5. Join the Fan Club

A ceiling fan can balance out a room's temperature, allowing you to turn down the AC and still feel cool.

6. Unplug

Even when all of your home electronics are turned off, many continue to suck down energy. The main culprits: televisions, VCRs, DVD players, stereos, phones and microwave ovens. (Generally, anything that has a clock, a remote control or an on/off light falls into this category.) In fact, idle TVs cost U.S. consumers $600 million annually, or $5 per household, according to the EPA. One solution: Plug the items that can truly be turned completely off into a power strip, and then use that as your on/off switch.

7. Fight Leaks

Your pricey, cooled air might be leaking right out of your house. Leaky windows and ducts (which carry the air to the rooms in your home) are two ways that cool air can be lost, making your air conditioner work harder. "We have found that as many as 70% of ducts are installed with leaks," says Vargas. Having your ducts properly sealed and insulated could save you as much as 10% in energy costs, according to the EPA. So if you think your duct system is faulty, try to have it checked out by an HVAC (heating, ventilation and air-conditioning) technician. (One way to find one is to visit the North American Technician Excellence web site.)

8. Be a Savvy Shopper

By far the biggest way to save is to invest in energy-efficient appliances. When shopping around, look for the Energy Star label. There are more than 44 product categories that qualify.

Of course, replacing your appliances (particularly the biggies, like a refrigerator or dishwasher) will require an upfront investment. But if you've got an old clunker, you could recoup your costs quickly. For example, if your central-air-conditioning unit is more than 10 years old, replacing it with an Energy Star-qualified model could cut your operating costs by 30%.

Expanded Mortgage Help

BUSH ADMINISTRATION TO EXPAND MORTGAGE HELP FOR STRUGGLING FAMILIES
Expanded FHASecure able to help half a million homeowners stay in their homes by cutting mortgage payments

WASHINGTON - The Bush Administration today announced additional mortgage assistance for subprime borrowers who are at risk of foreclosure. The plan, which is designed to help address the adverse economic conditions affecting many communities across America, will help break the cycle of house price depreciation that is being caused by an increasing number of foreclosures and the overall contraction in the credit market. Under the new plan, HUD's Federal Housing Administration (FHA) would have the added flexibility to insure more mortgages, including those for borrowers who were late on a few payments and/or received a voluntary mortgage principal write-down from their lender.

This FHASecure expansion will help more homeowners who are struggling to keep up with mortgage payments on their high-cost subprime loans. With this expansion of FHASecure, the Administration expects about 500,000 families to refinance into prime-rate FHA-insured mortgages in total by the end of this year.

"Our plan will help hundreds of thousands of desperate families who have no place else to turn for safer, lower cost ways to keep their homes," said Federal Housing Commissioner-Assistant Secretary for Housing Brian D. Montgomery at a hearing of the House Financial Services Committee. "We want to be able to help families who are in the right house, but the wrong mortgage."

In August 2007, FHA modified its refinancing program to help creditworthy homeowners who missed payments after their teaser rates reset. Now, FHASecure is expanding its eligibility standards. Homeowners who believe they meet this additional eligibility criteria must fall into one of the following categories:

1. Borrowers with adjustable rate mortgages who were late on two consecutive monthly mortgage payments or at two different times over the previous twelve months. FHA will require a 97 percent loan-to-value (LTV) ratio for these borrowers to refinance, the same LTV as FHA's current standard.
   
   
2. Borrowers with adjustable rate mortgages who were late on three consecutive monthly mortgage payments or at three different times over the past 12 months. FHA will require a 90 percent LTV ratio for these borrowers to refinance.

With these new criteria, the expanded FHASecure can help additional borrowers access a more viable refinancing option and will offer lenders an alternative to foreclosing on these individuals. Lenders may voluntarily write down the outstanding subprime mortgage principal balances to a 97 percent or 90 percent LTV ratio depending on the borrowers' circumstances. FHA will also encourage lenders to make other arrangements, such as subordinate financing, to "fill the gap" between the existing loan balances and the FHA-insurable loan amount. The refinanced loan amount backed by the FHA would be based upon a new appraisal, performed by an FHA-approved appraiser.

FHA will insure new, more affordable mortgages in exchange for this equity cushion, which will protect FHA's insurance fund, and thus the taxpayer, against risk. Currently, FHA's insurance fund is self-sustaining, meaning that it requires no appropriation of taxpayer dollars because homeowners pay for the product themselves. Further, any new FHASecure loans will continue to meet FHA's no-nonsense underwriting standards. Lenders will be required to ensure borrowers have the capacity to repay their mortgages; show a reasonable credit history; employment history; and fully document and verify their incomes.

Like all FHA-insured loans, borrowers will be required to pay upfront and annual premiums on their loans, which directly contribute to the soundness of FHA's insurance fund and protect taxpayers. FHA will also be simultaneously updating the pricing policy for these premiums. The new policy will base premiums on the individual borrower's credit risk profile. More than 90 percent of FHA-backed loans are 30-year fixed rate mortgages. Homeowners currently using FHASecure are saving $400 a month on average compared to their previous subprime loans.

"More homeowners continue to turn to FHA to find mortgage terms they can afford. We're keeping families in their homes while doing what's in the best interest of future generations who will rely on the safety and soundness of FHA to put a roof over their heads. The modifications to the existing FHASecure product offer a prudent, yet appropriate, way to help more families refinance without putting the government or taxpayers at risk. Consistent with FHA's historical mission, the changes are designed to help FHA provide additional liquidity and stabilize local real estate markets."

Since September 2007, FHA has helped pump nearly $68 billion of much-needed mortgage activity into the housing market, $28.5 billion of which was through FHASecure. FHASecure has helped more than 150,000 homeowners who are current or past due on their loans avoid foreclosure, and, with today's announcement, it is expected to assist 500,000 total families by December 31, 2008.

Housing Crisis Over?

The Housing Crisis Is Over

By CYRIL MOULLE-BERTEAUX
May 6, 2008; Page A23

The dire headlines coming fast and furious in the financial and popular press suggest that the housing crisis is intensifying. Yet it is very likely that April 2008 will mark the bottom of the U.S. housing market. Yes, the housing market is bottoming right now.

How can this be? For starters, a bottom does not mean that prices are about to return to the heady days of 2005. That probably won't happen for another 15 years. It just means that the trend is no longer getting worse, which is the critical factor.

Most people forget that the current housing bust is nearly three years old. Home sales peaked in July 2005. New home sales are down a staggering 63% from peak levels of 1.4 million. Housing starts have fallen more than 50% and, adjusted for population growth, are back to the trough levels of 1982.

Furthermore, residential construction is close to 15-year lows at 3.8% of GDP; by the fourth quarter of this year, it will probably hit the lowest level ever. So what's going to stop the housing decline? Very simply, the same thing that caused the bust: affordability.

The boom made housing unaffordable for many American families, especially first-time home buyers. During the 1990s and early 2000s, it took 19% of average monthly income to service a conforming mortgage on the average home purchased. By 2005 and 2006, it was absorbing 25% of monthly income. For first time buyers, it went from 29% of income to 37%. That just proved to be too much.

Prices got so high that people who intended to actually live in the houses they purchased (as opposed to speculators) stopped buying. This caused the bubble to burst.

Since then, house prices have fallen 10%-15%, while incomes have kept growing (albeit more slowly recently) and mortgage rates have come down 70 basis points from their highs. As a result, it now takes 19% of monthly income for the average home buyer, and 31% of monthly income for the first-time home buyer, to purchase a house. In other words, homes on average are back to being as affordable as during the best of times in the 1990s. Numerous households that had been priced out of the market can now afford to get in.

The next question is: Even if home sales pick up, how can home prices stop falling with so many houses vacant and unsold? The flip but true answer: because they always do.

In the past five major housing market corrections (and there were some big ones, such as in the early 1980s when home sales also fell by 50%-60% and prices fell 12%-15% in real terms), every time home sales bottomed, the pace of house-price declines halved within one or two months.

The explanation is that by the time home sales stop declining, inventories of unsold homes have usually already started falling in absolute terms and begin to peak out in "months of supply" terms. That's the case right now: New home inventories peaked at 598,000 homes in July 2006, and stand at 482,000 homes as of the end of March. This inventory is equivalent to 11 months of supply, a 25-year high - but it is similar to 1974, 1982 and 1991 levels, which saw a subsequent slowing in home-price declines within the next six months.

Inventories are declining because construction activity has been falling for such a long time that home completions are now just about undershooting new home sales. In a few months, completions of new homes for sale could be undershooting new home sales by 50,000-100,000 annually.

Inventories will drop even faster to 400,000 - or seven months of supply - by the end of 2008. This shift in inventories will have a significant impact on prices, although house prices won't stop falling entirely until inventories reach five months of supply sometime in 2009. A five-month supply has historically signaled tightness in the housing market.

Many pundits claim that house prices need to fall another 30% to bring them back in line with where they've been historically. This is usually based on an analysis of house prices adjusted for inflation: Real house prices are 30% above their 40-year, inflation-adjusted average, so they must fall 30%. This simplistic analysis is appealing on the surface, but is flawed for a variety of reasons.

Most importantly, it neglects the fact that a great majority of Americans buy their houses with mortgages. And if one buys a house with a mortgage, the most important factor in deciding what to pay for the house is how much of one's income is required to be able to make the mortgage payments on the house. Today the rate on a 30-year, fixed-rate mortgage is 5.7%. Back in 1981, the rate hit 18.5%. Comparing today's house prices to the 1970s or 1980s, when mortgage rates were stratospheric, is misguided and misleading.

This is all good news for the broader economy. The housing bust has been subtracting a full percentage point from GDP for almost two years now, which is very large for a sector that represents less than 5% of economic activity.

When the rate of house-price declines halves, there will be a wholesale shift in markets' perceptions. All of a sudden, the expected value of the collateral (i.e. houses) for much of the lending that went on for the past decade will change. Right now, when valuing the collateral, market participants including banks are extrapolating the current pace of house price declines for another two to three years; this has a significant impact on the amount of delinquencies, foreclosures and credit losses that lenders are expected to face.

More home sales and smaller price declines means fewer homeowners will be underwater on their mortgages. They will thus have less incentive to walk away and opt for foreclosure.

A milder house-price decline scenario could lead to increases in the market value of a lot of the securitized mortgages that have been responsible for $300 billion of write-downs in the past year. Even if write-backs do not occur, stabilizing collateral values will have a huge impact on the markets' perception of risk related to housing, the financial system, and the economy.

We are of course experiencing a serious housing bust, with serious economic consequences that are still unfolding. The odds are that the reverberations will lead to subtrend growth for a couple of years. Nonetheless, housing led us into this credit crisis and this recession. It is likely to lead us out. And that process is underway, right now.

Mr. Moulle-Berteaux is managing partner of Traxis Partners LP, a hedge fund firm based in New York.