Across the United States, nearly 10 million homeowners are still making forward mortgage payments who are at least 65 years old or higher. While it’s unlikely that all of those homeowners would be approved for a product like a reverse mortgage is difficult to say, but it gives additional context to the presence of an addressable market and the potential for the product category. There is a catch, however.
The statistic comes from LendingTree, which last week released the results of an analysis of data from the U.S. Census Bureau, aiming to localize them to one of 50 American metropolitan areas.
“We found across these 50 metros that an average of nearly 19% of homeowners who are 65 and older still have a mortgage,” the results read. “Beyond that, we also found that homes owned by people in this age group tend to be less valuable than those owned by the general population — and that their monthly housing costs tend to be lower.”
The largest share of 65-plus homeowners with a mortgage in the United States is concentrated in three metro areas across two states: Miami, Fla. and both Sacramento and Los Angeles, Calif. Across these areas, nearly a quarter of senior residents – 23.64% – have an active, traditional mortgage.
Three Texas-area metros – Houston, Austin and Dallas – contain the smallest share of senior homeowners with an active forward mortgage, comprising 13.71% in these areas, according to the Census data. In terms of the “catch,” it revolves around seniors’ homes having less comparative value than the general population. This is not a universal constant, however.
“Across the nation’s 50 largest metros, older homeowners’ homes are worth an average of $10,626 less than homes owned by the general population,” the findings read. “That being said, the disparity in value varies by metro, and there are a handful of areas where homes owned by older people are worth more than those owned by the overall population.”
Another point concerns the costs of housing for seniors when compared to other members of the population. According to the Census Bureau’s data, seniors have generally lower costs associated with their housing situations.
“Across the nation’s 50 largest metros, the average total monthly housing costs for 65-and-older homeowners with a mortgage are $268 less than they are for the general population,” the findings read.
Read the findings of the Census Bureau data analysis at LendingTree.