NRMLA: Seniors See Home Values Increase 12.5% Since 2011

Posted by Patrick Barnard on October 21, 2013 No Comments
Categories : Residential Mortgage

Americans age 62 and older saw their home values increase an average of 12.5% since the second quarter of 2011, according to a report from the National Reverse Mortgage Lenders Association (NRMLA).

As such, seniors now have more equity in their homes than at any time since mid-2008, according to the NRMLA/RiskSpan Reverse Mortgage Market Index (RMMI).

In aggregate, home equity held by Americans 62 and older grew about $101 billion in the second quarter, driven by an estimated $98 billion increase in home values. As of the end of the second quarter, seniors had a total of about $3.34 trillion in equity.

Meanwhile, seniors' collective mortgage debt declined by about $3.4 billion and stood at about $1.07 trillion – its lowest level since the third quarter of 2007. Senior mortgage debt peaked at $1.14 trillion in the third quarter of 2010, according to the report.

‘Today's report brings good news for the American housing market and for senior homeowners,’ says Peter Bell, president and CEO of NRMLA, in a release. ‘Home values continue to recover. Collective home equity levels have been steadily rising while mortgage debt has been declining, creating a valuable resource homeowners can use to help finance their retirement.’

The collective home equity of Americans 62 and older has grown by 83.7% since the RMMI's starting point in the first quarter of 2000. At that time, seniors owned about $2.10 trillion in home equity, compared to $3.34 trillion today.

Still, home values are down about 10.8% compared to their peak in the fourth quarter of 2006. What's more, the collective home equity held by seniors is down by about 16.6% compared to that quarter.

The report draws on home price data provided by the Federal Housing Finance Agency and RiskSpan.

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