The housing wealth of homeowners aged 62 and over grew by 1.4 percent, or $98 billion in the fourth quarter of 2018, resulting in a record total housing wealth level of $7.05 trillion, according to figures reported Wednesday by the National Reverse Mortgage Lenders Association (NRMLA) in its quarterly release of the NRMLA/RiskSpan Reverse Mortgage Market Index (RMMI).
“Despite slower home price appreciation, we ended 2018 on a high note,” said Steve Irwin, Executive Vice President of NRMLA, in a press release announcing the data. “The RMMI increased for the 31st consecutive quarter, there are now 23.9 million senior homeowners – the highest number ever – and these homeowners hold a record $7.05 trillion in home equity. For many retirees, a reverse mortgage offers the perfect solution to extract this home equity and put it to good use, so that they can live more financially secure lives.”
In the fourth quarter of 2018, the RMMI rose to 254.10, described as another all-time high since the index’s initial publication in the year 2000. The increase in senior homeowner wealth was driven primarily by an estimated $110 billion, or 1.3 percent increase in senior home values. It was offset by an $11.7 billion, or 0.7 percent increase of mortgage debt held by seniors according to the press release.
The RMMI also 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. “The slowdown in the rate of growth in the RMMI can be attributed to lower home price [appreciation] rates nationwide,” the press release noted.