The aggregate housing wealth of homeowners aged 62 and over increased 3.4% in the first quarter of 2021 from the previous quarter. This represents an increase of roughly $ 305 billion to a record $ 9.23 trillion, according to data provided by the National Reverse Mortgage Lenders Association (NRMLA) in conjunction with market research firm RiskSpan.
The increase in debt was reported on Thursday in the NRMLA / RiskSpan Reverse Mortgage Market Index (RMMI) quarterly release, according to an NRMLA press release.
The RMMI rose to 322.89 in the first quarter of 2021, another all-time high since the index was originally published in 2000. This increase has been described as mainly due to an approximately 3% (or $ 329 billion) increase in the value of owned homes. older people. However, this was offset by a 1.2% (or $ 23.9 billion) increase in pre-emptive mortgage debt.
The increase in RMMI was primarily due to the update of the relevant data sources used to estimate the size of the 62+ homeowner cohort – along with older home prices – using the 2019 American Community Survey (ACS). The data source for estimating primary credit value (LTV) levels has been updated using the 2016 Consumer Finance Survey, according to RMMI, based on a press release.
“A new Fidelity study predicts that the average 65-year-old couple will spend $ 300,000 on post-retirement health care, while single women spend $ 157,000 and single men $ 143,000,” says NRMLA president Steve Irwin in the announcement of new data. “As the baby boomer generation matures and the pressure on public resources increases, strategic use of equity capital can help retirees cope with these potential challenges.”
On an annualized basis, RMMI increased by 8.3% in 2020, outpacing changes in previous years, including 2019 (5.4%) and 2018 (6.3%), which is believed to be associated with higher levels of price increases for housing in 2020. NRMLA President Steve Irwin emphasized that the increased value of older-owned homes could make the reverse mortgage option worthy of renewed consideration, according to RMMI’s latest quarterly report. april, bringing the housing wealth of older people to over $ 8 trillion for the first time.
According to previous data from RMMI in the United States, the state of the housing stock of the elderly for the first time in history exceeded $ 7 trillion. March 2019… It then continued to rise, reaching USD 7.23 trillion. april 2020, $ 7.54 trillion. June, $ 7.70 trillion. October and $ 7.82 trillion. January 2021…
While the year-on-year growth in 2020 is an improvement, it hasn’t quite been able to match the 8.4% growth recorded in 2017, but it slightly outperformed the 8.2% growth seen in 2016.