Senior home equity continues to rise in 2012 with the third quarter posting the fastest quarterly gain since 2005, according to data from the National Reverse Mortgage Lenders Association (NRMLA) and RiskSpan Reverse Mortgage Market Index (RMMI).
The RMMI reported a 2.4% rise in senior home equity to a reading of 150.0, which the index mentions as the highest level it has seen since the second quarter of 2009.
Driving the growth was a $74 billion increase in senior home equity resulting from a $66 billion rise in aggregate value of senior housing and an $8 billion decline in seniors’ mortgage debt.
The value of senior housing is based on the Federal Housing Finance Agency’s (FHFA) third quarter 2012 all-transactions indices, says Allen Jones, RiskSpan’s managing director. These indices saw housing values increase in 84% of the 395 metropolitan service areas covered by RiskSpan, notes Jones.
This latest reading from the RMMI marks the third consecutive increase for senior home equity in 2012. Home equity among seniors recorded a reading of 146.27 in the first quarter. For the second quarter, senior home equity recorded a level of 146.45.
Written by Jason Oliva