Older homeowners continue to rake in the home equity as home values appreciate across the nation, with the latest data revealing that equity levels for the 62-and-older set grew by $104 billion last quarter.
That brought senior housing wealth to a record-breaking $7.14 trillion in the first quarter of the year, according to a quarterly index published by National Reverse Mortgage Lenders Association and RiskSpan.
The record-breaking total was driven by an estimated 2.4% increase in senior home values, which combined with increase of 0.8% in the senior home-owning population, the NRMLA/RiskSpan Reverse Mortgage Market Index revealed. This figure was then offset by a 1.1% – or $6.5 billion – increase of senior-held mortgage debt.
NRMLA President and CEO Peter Bell said this immense source of wealth highlights the role home equity could play in creating a stable retirement for older Americans.
“Reverse mortgages have become an essential component for addressing a huge problem for many Americans: funding retirement,” said Bell. “More than 1.12 million families have used a reverse mortgage alongside side their 401(k)s, IRAs, savings, investments, Social Security, Medicare and Medicaid to cover life’s daily expenses, so they could live more financially secure lives.”
“As with all major financial decisions, a reverse mortgage should be part of an overall strategic plan, with input from knowledgeable professionals, and family members who may be impacted,” Bell added.