Homeowners age 62 and older saw their collective housing wealth increase in Q1 2019 by 2.7 percent compared to the previous quarter. This constitutes an increase of approximately $104 billion to a record of $7.14 trillion, according to data provided by the National Reverse Mortgage Lenders Association (NRMLA) in conjunction with data analytics firm RiskSpan. The increase was reported Monday in the quarterly release of the NRMLA/RiskSpan Reverse Mortgage Market Index (RMMI).
The RMMI rose in Q1 2019 to 257.12, which marks another consecutive all-time high since the index’s original publication in 2000. That increase was described as being primarily drivenby an estimated 2.4 percent (or $110 billion) increase in the values of homes owned by seniors, which also includes an estimated increase of 0.8 percent in the population of senior homeowners.
This was offset, however, by a 1.1 percent (or $6.5 billion) increase of senior-held mortgage debt.
“Reverse mortgages have become an essential component for addressing a huge problem for many Americans—funding retirement,” said NRMLA President and CEO Peter Bell in a press release announcing the data. “More than 1.12 million families have used a reverse mortgage alongside side their 401Ks, IRAs, savings, investments, Social Security, Medicare and Medicaid to cover life’s daily expenses, so they could live more financially secure lives.”
Bell also echoed the sentiment he shared about reverse mortgage products in a recent USA Today op-ed, which responded to an investigative story concerning the safety and effects of taking out a reverse mortgage loan.
“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 advised.
Senior housing wealth topped $7 trillion for the first time ever according to the previous RMMI data release in March 2019. The RMMI also previously recorded a year-over-year increase of 6.5 percent in 2018, lower than the 8.4 percent increase recorded in 2017 and the 8.2 percent increase in 2016.