Index: Seniors Hold $4.3T of Home Equity

Americans 62 years of age or older hold an estimated $4.3 trillion of home equity, according to the NRMLA/Hollister Reverse Mortgage Market Index.The index, launched by the National Reverse Mortgage Lenders Association and The Hollister Group, is the first market indicator to collect critical market, housing, and demographic data and to track and project the market for reverse mortgages, Hollister said. "The idea of using home equity to finance retirement is becoming increasingly mainstream even among the current generation of seniors who have traditionally been debt-averse," said NRMLA president Peter Bell. "The RMMI illustrates the significant opportunity for mortgage industry participants as the home increasingly plays a role as a retirement asset." The reverse mortgage industry has grown rapidly in the past five years, but only about 300,000 reverse mortgages have been originated, representing less than 1% market penetration, Hollister said. In the first quarter, home equity held by senior citizens rose by $19 billion, which was reflected in a 0.4% increase in the RMMI from 204.7 to 205.6. The organizations can be found online at http://www.nrmlaonline.org and http://www.hollisterllc.com.