Flood on green meadow, trees and grass in water.  Landscape in sunny spring day.

Going Green Could Save The World $22 Trillion

According to economists, improvements in energy efficient buildings, public transit, and better recycling and waste management initiations could save over $22 trillion. And cities that spend the money to make “green” improvements and adjustments to their community will benefit more financially in the long run, and continue to save money that would otherwise be spent on more costly and less environmentally-sound maintenance of the city.

In addition to the massive cost-cutting benefits, the economist’s suggested global movement towards energy efficiency could prevent the carbon pollution equivalent of India’s entire greenhouse gas output annually. The suggested preemptive climate-saving changes could save money spent by cities around the world, as well as prevent further spending on combating the negative effects of climate change.

An independent organization comprised of seven different countries’ leading finance ministers and research institutions called The Global Commission on Economy and Climate released their findings this September. Economists, financial experts, researchers, and scientists from Colombia, Ethiopia, Indonesia, Norway, South Korea, Sweden and the United Kingdom agree that a global movement towards “green” cities could save trillions of dollars.

Among the benefits the group listed as a side-effect of the world enacting energy-efficient initiatives were increased global living conditions, health, and quality of life as well as financial benefits and cost-savings. They also claimed the climate-conscious improvements to the world’s cities would dramatically reduce poisonous carbon pollution and greenhouse gas emissions.

The estimated savings of over $22 trillion could feasibly be reached by 2050 if world governments began making energy effective efforts within the year, according to expert analysis. The global savings would come from reduced costs from saving money on transportation, buildings, and waste disposal.

Researches also found that by 2030, the cost-effective efforts would simultaneously prevent 3.7 gigatonnes of greenhouse gas emissions per year. But advocates within the group have acknowledged that the environmental benefits are not enough to tempt many world governments from enacting more energy efficient changes within their cities, so they performed the study to prove the cost-effective financial benefits of city upgrades to transportation, waste management, and buildings.

The study’s findings have disproved the concern that global energy efficient changes would be too costly. Researchers released the data to prove that reasonable improvements made to cities’ basic infrastructure could actually save them trillions of dollars, as well as reduce their pollution significantly within just 20 years.

Seth Schultz was among the economic researchers that were consulted for the report, in which he stated,“There is now increasing evidence that emissions can decrease while economies continue to grow. Becoming more sustainable and putting the world – specifically cities – on a low carbon trajectory is actually feasible and good economics.”

The report found that the most immediately noticeable changes, both financially and environmentally, would be in transportation. In many of the world’s largest cities, public transportation is almost non-existent, or is so dilapidated that it’s excessively expensive to run as well as extremely draining of costly and limited fossil fuels. Researchers said that by introducing more convenient and low-cost, energy efficient public transportation systems in every major city, lives could be saved from traffic accidents, commute times would be reduced by as much as 50% instantly, and millions of dollars would be saved in costs to run outdated transportation.

Individuals in urban areas would also save money personally by avoiding the expenses of owning, maintaining, and driving a car, while simultaneously reducing their individual carbon emissions, and would be travel statistically safer as well as faster. Improvements made in cities’ public transportations systems would create jobs and cut down on federal and personal costs, the study claims.

The study goes on to say that by making basic energy-efficient improvements in buildings, countless dollars could be saved in electricity spending, heat and cooling costs, and wasted water that racks up large bills. They even suggest that by harvesting biogas from waste management, cities’ waste could be harnessed as fuel to provide electricity to the cities’ communities, such as those already being done by Lagos in Nigeria and other cities around the world.

The suggested improvements for cities around the world could save an estimated $22 trillion as well as reduce harmful gas emissions, making the expert findings a powerful argument in the case for governments to make energy-efficient improvements a priority if they want to reduce national debt and spending.

Are We Trapped in Another Housing Bubble?

If you were personally affected by the housing market crash in 2006 to 2008, you are constantly keeping watch on real estate trends. When home prices begin to go up, it’s no wonder you are automatically suspicious. And with the rise in home values over the last few years, you aren’t alone in your concern. Many finance experts feel similarly – they are starting to feel nervous about where the latest home price increase will take us and when it will stop.

What is a Housing Bubble?

A housing bubble describes the increase in home prices due to factors such as high demand and speculation. When the prices get too high, high enough where consumers can no longer afford the cost, or the economy experiences a downturn, the bubble bursts. Houses drop drastically in value and depending on the severity, it can take many years for the market to fully rebound.

Is the Current Market Showing Signs of a Housing Bubble?

Yes, home prices are going up, but maybe not as drastically as some may think. All real estate prices are normally tied to industry growth at a local level. For instance, while homes are selling quickly, at above asking prices, in metropolitan areas like San Francisco and Boston, other areas see normal to stagnant movement of real estate. While home prices quickly jumped from 2013 to 2014 and continue to rise in 2015, the rate has slowed. Part of the increase in home value is due to builder caution against creating new inventory. While you may believe individuals were burned the most when the 2006 bubble burst, you would be mistaken – many builders took the brunt of the hit as well. In 2014, 1 million new homes hit the market, but only 700,000 were single family homes. In a healthy real estate market, 1.6 million homes are for sale, with single-family homes clocking in at over 1 million.

It’s clear the price increases can be mostly tied to a lack of inventory, most likely stemming from builder and current homeowner caution. In many cases, builders simply do not want to take on the same amount of risk again. For homeowners, they are most likely trying to regain the lost equity from 2006 and may still be underwater on their mortgages. For a real estate market to flourish, homeowners have to be willing to pack up and move and lately, that has not been the case.

So while many experts point to the rising prices as indications of a bubble, it’s most likely due to the continued aftershocks of the 2006 downturn. Lenders are not providing loans to anyone who applies – strict standards still apply to all applicants. As confidence in the economy grows, more and more homeowners may be willing to list their homes, providing a greater range of inventory and creating a steadier flow of sales and the home price inflation will steady. So if you’re thinking about buying or selling, be cautious, but don’t change your mind due to distant threats of a housing bubble approaching – it is most likely not the case and a repeat of 9 nine years ago has a low chance of occurring.

What You Really Need to Consider Before Trying Your First Flip

The dream of the income property is still alive and well, whether it’s in the form of renovation and rental or picking up an out of shape house and flipping it for straight profit. Flipping a house isn’t quite as easy as the TV shows make it look, though, and if you’re looking to try your first flip, there are some things you should consider beforehand to make sure you get the most money after the fact.

Budget

This goes for time and money. You’ll start out with a calculated timeline and what seems like a reasonable budget. You might even build in a bit extra for delays in work or unforeseen expenses. No matter what your spreadsheet says now, assume that figure is a low-ball. Most flips run over budget and over schedule, simply because certain things won’t be known until you start the process. Bad plumbing and faulty wiring, for example, often aren’t seen until after the property is purchased and the demolition phase begins. Those kinds of problems end up costing thousands extra and days or weeks more than planned.

Take a look at your budget now. If you’re operating within narrow margins, the type where the property is only worth buying if you don’t spend any more than you currently have planned on the renovations, a flip isn’t for you. There’s a reason not everyone is out there doing this – properties that are affordable and require just the right amount of work to not eclipse resale value aren’t abundant, and competition is often fierce. Consider what you’re really getting, and what you can really afford. If you only have what you plan for, or if you can only take 3 weeks of work to make it happen, you’re budget isn’t reasonable for a flip.

Your Team

First, realize something important – you can’t do it all. Certain things are going to be difficult for you to do on your own, such as installing large fixtures, while others might lead to illegal results if not undertaken by a professional, such as electric wiring. Figure out who’s going to be on your team before you ever have to start working with them.

If you have a partner in the process, all the better! Make sure you guys are on the same page when it comes to how labor, financing, and the end sale will work. The more you’re able to manage expectations, the better you’ll be able to get through any difficulties that may arise.

Talk to plumbers, electricians, and contractors beforehand, too. Even if you do the bulk of the work on your own, you’ll likely need each of those at least once. Take the time beforehand to set up a team that you know you can trust – read reviews, check licensing, talk cost and payment, make sure everything is in order. That way, you’ll be spared the stress of having to bring in a random company of unknown quality later on.

Function vs. Aesthetic

You want to make the house look good, that’s what going to sell it later on. But don’t ignore necessary upgrades that may not be seen in favor of purely aesthetic features. Cutting corners structurally to add more funds into the feature fireplace you’re planning isn’t just unethical, it could lead to lawsuits later down the road. Make sure everything is structurally sound first – have inspectors come out and let you know where the problem areas are. Worry about how good something looks after that.

On the same note, remember that just because something looks good doesn’t mean it’s functional. Adding pieces that have no functional purpose, such as unnecessary extra cabinets in a kitchen, might offer some visual appeal on paper, but they could end up clogging a space and actually driving the renovation value down. Look around the area – see what the top sellers are highlighting. If an open floorplan is what’s moving in the area, go for that even if it means modifying some of the original design. It’s more about what’s going to sell than what the flippers think will look good. Give your buyers the space that they’re going to want.

Permits

This flies under the radar with a lot of first time flippers. Even when you own a property, you aren’t able to do anything you want to it without some general reporting or oversight. Check with your city, county, and state to see what on your list of renovations will need a permit before you ever touch the house, and get those permits straightened out in advance.

Not having a permit or having improper permits could slow a project by weeks or even months. Front-load the hassle to make things easier as renovations get underway.

There’s no one right way to flip a house, and when it’s done right, working on your fist income property can be an exciting new business venture. Just make sure you have at least some of your flip beyond wall colors and room flow figured out early. That way, you’ll be ready to handle the rest as it comes.