Investors and property agents were jumping for joy last week when billionaire Warren Buffett predicted that U.S. residential problems will be largely behind us within a year or so.

On page 11 of his annual letter to shareholders, the great man opined that the US housing industry was currently in a shambles for two reasons.

The first, and most obvious, was that during the prolonged boom, housing starts ran at about 2 million annually, while household formation amounted to about 1.2 million annually.

After a few years of such large imbalances, the USA unsurprisingly ended up with far too many houses.

Jokingly, Buffet offered three ways to adjust the imbalance:
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1. Blow up a lot of houses, a tactic similar to the destruction of autos that occurred with the “cash-for-clunkers” program.

2. Speed up household formations by, say, encouraging teenagers to cohabitate, a program not likely to suffer from a lack of volunteers.

3. Reduce new housing starts to a number far below the rate of household formations.

Housing Starts Now at Record Lows
With housing starts at 554,000 last year, the lowest since records began in 1959, Americans are well on their way to correcting this imbalance. As Buffett stated, “our country has wisely selected the third option, which means that within a year or so residential housing problems should largely be behind us, the exceptions being only high-value houses and those in certain localities where overbuilding was particularly egregious”.

His second reason for the current distress in the US Housing market was due to the large gap in mortgage availability and interest rates offered to people who purchase site built homes vs factory built homes. This is a particular bugbear for Mr Buffett as his company owns an big factory home builder called Clayton Homes .

Far be it from me to read too much into the latest message from the worlds´ most celebrated investor, but I can imagine that he must constantly be toning down his messages to the general public due to his unique influence on the markets. If he came right out and said “you know what folks, 2010 is a pretty good time to purchase undervalued real estate because the market is well on its way to correcting imbalances during the boom years” there would probably be stampedes of investors trying to snap up available inventory all over the country.

If there were stampedes of investors all of a sudden, no doubt some of them would be pounding on the big doors of the beautiful clubhouse in Mosaic at Mall of Millenia . At the moment, properties in this resort start at just €44,000 ($60,900) have 97% occupancy and we have 7 units with double digit net yields.

It is probably worth mentioning that we mean real double digit net yields. Perhaps unsurprisingly, and no doubt in their excitement to promote a new product, some agents forget to include all the monthly costs before advertising how great the rental returns are.

No matter where you buy in the USA, you will get your real net yield when you subtract HOA fees, real estate tax, rental management fees and home insurance from your average monthly income. Anything else is misleading. In a lot of states (but not Florida), you´ll have to account for state tax as well.

What if Mr. Buffett´s prediction is right?
Let´s assume for a moment that his prediction of a US housing recovery sometime in 2011 is correct and let´s also bear in mind that people who have betted against him in the past haven´t done so well.

Is it better to wait until 2011 and start investing in property once prices start recovering? Or might it be worth using some money sitting in a (very) low interest savings account to purchase well priced high quality properties while they are still available?

It´s been a crazy 18 months in the real estate business, but as the Sage of Omaha himself said “Look at market fluctuations as your friend rather than your enemy; profit from folly rather than participate in it”.

Translation: These fluctuations caused a flood of motivated sellers to appear. They won´t stay so motivated indefinately.

Foreclosures are down; sales of single-family homes are up. Mortgage rates are about as close to a record low as they have ever been, at a time when prices are on the rise.

Basically, these are the market conditions in Boston right now. Of course, as with everything else, there are exceptions to these rules.

Suburban residents are playing the “I’ll scratch your back if you’ll scratch mine” game. In other words, prospective buyers are telling prospective sellers, “If I can sell my house, I’ll buy your house.”

In order to be able to do this, sellers and buyers are doing a lot of interesting things. These include placing contingency clauses in home contracts, temporarily “floating” two mortgages—one on the house they are selling, and the other on the house they are buying—until such time as the for-sale house is purchased.

Just as with anything else, whether or not you can afford to buy a home anywhere in Boston or its suburbs is a personal decision that only you and your spouse or partner can make. High-end homes and/or homes in locations that you may have once believed were far beyond your reach have become more affordable, and, yes, interest rates are also down. But, you still must determine whether or not you can meet even reduced payments.

The same things that must always be considered when buying a home, no matter what the economic situation is, still hold. Your debt-to-income ratio, your credit score, and your employment situation, including the possibility that it could change, are all still factors in the decision.

Property taxes and municipal services, in some instances, will also play a role. Although you may not consider them a part of the mortgage, they are a part of the overall expense of owning a home.

Market conditions in Boston are continuing to fluctuate, just as they are in other parts of the country. Before making what is going to be one of the most important decisions you will ever make, you still need to consider all angles of buying a home.

If you do decide you are able to make that investment, there are Realtors available to help you find just the right house. Or, if you prefer to go the “for sale by owner” route, these are available, too, and you can find people who can help you navigate the home-buying process.

Dubbed Commonwealth Solar II and Commonweath Solar Stimulus, the programs aim to fill the gap in financial incentives left when the first, $68 million Commonwealth Solar program ran out of money in October — more than two years ahead of schedule.

At the time, solar installers told the Boston Business Journal they were concerned the lack of incentives would stop projects from moving forward.

Commonwealth Solar II will provide rebate incentives for small residential and commercial systems, with total allocations up to $4 million per year. This program will be funded through the Massachusetts Renewable Energy Trust, which managed the last Commonwealth Solar program and is funded by a surcharge on electricity bills.

For larger projects, state officials plan to tap $8 million in state energy plan funding from the American Recovery and Reinvestment Act to provide rebates to projects.

Both programs are expected to begin in late January.

“Commonwealth Solar has already played an important role in speeding the Bay State’s transition to a clean energy economy,” Gov. Deval Patrick said in a statement. “I commend the more than 1,200 homeowners, businesses and municipalities who have taken advantage of this innovative program in the past two years, and encourage many more to partner with the commonwealth as we continue along the path toward a cleaner future.”

The state continues to work on a long-term incentive program based on renewable energy credits, which must be purchased by utilities and can be used to finance projects, rather than post-construction rebates. The Massachusetts Department of Energy Resources is developing regulations for such a scheme, and officials say they expect a program to launch in January.

“I generally use my patio for entertaining, but for a spa treatment, that’s special,” says garden designer Jill Slater. With simple embellishments from around the house and purchased from the garden center, Jill shows how you can turn your patio into a day spa where special guests can enjoy facials, foot baths and even spa rock treatments.

Creating a spa-like atmosphere
In order to create a tranquil spa retreat, find ways to appeal to the five senses – sight, smell, taste, sound and touch – to help you get in the mood. Incorporate plants and accessories that offer appealing colors, textures, fragrances and even tastes.

To start, embellish existing patio furniture with big, comfortable pillows that invite spa-goers to sit and rest. Don’t be afraid to use different colors, sizes and textures. You can find a variety of pillows designed for indoor and outdoor use, and if you want something that stays on the patio, many of the new weatherproof fabrics are durable and attractive. Toss the pillows anywhere a bit of added comfort is desired.

However, if you’re looking for an inexpensive alternative to dressing up drab pillows and cushions, use a beach towel as a covering. This way you can adjust it to fit an existing pillow accordingly, and when you’re finished, take it back inside to wash in the laundry. “The best spas are meticulously clean so a beach towel that gets flung into the washing machine after a messy spa treatment makes a lot of sense,” Slater says.

A home spa just wouldn’t be a spa without the sound of tranquil water. “You can buy miniature tabletop fountains practically anywhere,” Slater says. To add your own personal touch to your tabletop water feature, float flowers from your garden in the water or add brightly colored rocks or marbles to the water basin.

The soothing power of plants is an important ingredient to your backyard spa oasis. Use plants with palate-pleasing scents and textures. Herbs such as rosemary, lavender and scented geraniums not only smell and look great but can also be used in your homemade herbal spa treatments. Incorporate plants in shades of pastel pinks, purples, whites and silvers to create a soothing color palette. Get creative with moveable container plantings.

Finish setting up your outdoor spa by accessorizing with scented candles, an outdoor rug, hand towels, bottled water and other objects. Play some soft mood music in the background. Set up a standalone umbrella to protect spa-goers from the sun or stand an oscillating fan in one corner to provide a gentle breeze on a hot day.

Homemade spa treatments
Once the atmosphere has been created, invite some friends over for a day at your home spa and prepare all-natural homemade spa treatments that you can give to your friends. Start with a foot and hand soak. Add equal parts of warm water and buttermilk to a large bowl and stir gently. Then add a few dashes of essential oil to the mixture. Lavender can be used for its calming and balancing properties, while eucalyptus is a good choice for an uplifting, refreshing feel. Place hands in the bowl and allow to rest for a few minutes. Add smooth rocks to the bowl for a nice foot massage.

Perhaps a little exfoliation is on the menu? Prepare two cups of sea salt, one cup of grapeseed oil and a few liberal dashes of jasmine essential oil for a moisturizing exfoliating treatment.

And who doesn’t love a rose mask facial? Prepare three tablespoons of natural yogurt (not the low-fat kind), 2-1/2 tablespoons of rose water and a dollop of honey as a natural antiseptic.

You could even grow the sponge used to apply these mixtures. The loofah sponge is a natural exfoliant and can be grown in your own garden. Purchase loofah gourd seed online or at a specialty garden center and plant them after the last frost date. Let the fruit ripen on the vine. Harvest them when you can hear the seeds rattling inside. Peel away the skin, remove the seeds and allow them to soak in water prior to use.

Patios are supposed to be relaxing sanctuaries that make you feel better, and here’s one that helps you look better too. But the best part about the patio spa? No appointment necessary!

A major kitchen overhaul can be very costly, yet equally effective when placing your home on the market. While not everyone can afford the cost of a possible $75,000 full-scale remodel, there are simple, wallet-friendly steps you can take to spruce up the heart of your home with a surface renovation. Here are the top 10 do-it-yourself tips for updating your kitchen and making it sparkle:

1. Stick to the Plan – The key to keeping your kitchen update within budget is by not changing the existing layout. Use what you have to make the job easier and much more affordable. This will also keep any plumbing or electrical costs to a minimum.

Replacing the handles and knobs on your cabinetry and drawers can enhance the design of your kitchen.

2. Accessorize – You’d be surprised with how replacing the old knobs and handles on your cabinetry and drawers can make a difference in your design. Today’s hardware comes in any shape or design you can imagine, and can pull a room together with a polished, clean look.

3. The Magic of Paint – New paint makes everything look clean and bright again. And don’t forget the ceiling. Applying a fresh coat to your kitchen is an easy, inexpensive, effective way to revive the room. Have fun with it, and paint the trim a contrasting color, or create an accent wall by using a different shade of the same color. Try to stick to neutral colors, as an overbearing scheme can turn off some potential buyers.

4. Everything but the Kitchen Sink – Replace the faucet and update it with a more sleek, stylish model available at any home improvement store. The work is not difficult and just requires a few basic tools. But the outcome does wonders for the look and design of your kitchen.

5. Make a Splash – Updating the backsplash can add a new dimension of style and creativity to your design. This project can be done with a bit of tile, a new coat of paint, wallpaper, or even beadboard.

Installing a rack above your island creates a stunning focal point.

6. Shade for Your Island – Does your kitchen have an island? If so, install a pot rack over the island to save space while adding an interesting focal point.

7. Save Face – Do your appliances clash with the new design of your kitchen? You can update your appliances without buying new ones by replacing the panels to your dishwasher, stove, or refrigerator to match your new color scheme or even your cabinet door color.

8. On the Surface – If your existing countertop is old, worn or outdated, try replacing it with some new tile. This can be done pretty inexpensively, especially if you don’t have a lot of counterspace. Again, try to keep it neutral.

9. Let there be Light – Creating the best lighting design for your kitchen is like cooking a great meal; you have to have the right recipe and the proper ingredients. Ceiling lighting sources can be replaced with updated fixtures or designs, many of which utilize brighter, energy efficient bulbs. Adding under-cabinet lighting eliminates shadows created by ceiling lights placed close to cabinets. Plus, they create abundant light to help you see your meal preparing projects better.

10. Look Down – Once all the other work is completed, look to the floors to complete your updated package. Choose flooring that is easy to maintain, since spills, drops and accidents of all sorts happen in the kitchen. Think function before beauty when it comes to the kitchen floor. Rest assured, with all the styles and designs available today, there are plenty of beautiful choices.

Making the Most of Dining Rooms

When considering various dining room ideas, it’s important to think about the size of the room compared to the size of the dining room furniture. Dining room tables and dining room chairs must be the right scale for the size of the floor plan, or else no one will be able to sit comfortably and enjoy a meal. The general guideline for dining room chairs is to allow about two to three feet clearance for guests to get into and occupy seats. The minimum allowance for traffic around the dining room table and chairs should be approximately two feet. This will ensure for an easy traffic flow for your guests.

In addition to the size of the space, you should also consider how many people will be using the dining room. For a family of four, their daily needs are for a minimum of four dining room chairs. If guests frequently join the family for lunch or dinner, then an expandable table along with several extra dining room chairs will be invaluable. For a home with one dining area, this adjustable dining room furniture design will be even more important as the room transforms to accommodate small or large gatherings.

Dining Room Furniture Options

Dining room ideas are really limitless since the materials available for tables and chairs can range from wood, metal, glass, plastic, stone, leather, and fabric. The basics of dining room decorating involve first selecting the right table and chairs. Dining room tables come in many shapes such as round, square, and rectangle. Round tables allow for better eye contact than oblong or rectangle versions. A round or oval table will also make it easier to add an extra chair when the need arises. Square dining room tables are becoming more popular especially in contemporary dining room design. Banquette or booth designs are ideal for breakfast nooks or casual dining spaces.

Dining room chairs are often available in a matched set with a table. However, an eclectic mixture of different chairs is well-suited to a cottage, country ranch, or contemporary dining room design. One painless way to try this idea is to buy the same style of chair in different colors or finishes if that is available; otherwise, you have them upholstered or painted in several coordinating colors.

If space allows, dining room furniture should also include pieces for use as serving areas and storage. The most commonly seen dining room furniture used to serve up food include buffets, sideboards, console tables, and harvest tables. A contemporary dining room design often features a large floating shelf as a buffet area. Dining room furniture storage options for dishware and glassware include china cabinets, breakfronts, cupboards, baker’s racks, wine racks, or open shelving.