The amount of home equity owned by American seniors fell by $63 billion between the first and second quarters, the National Reverse Mortgage Lenders Association/RiskSpan Reverse Mortgage Market Index found.
The index itself is at 149.9, down 2% from the first quarter and is now at its lowest point since the second quarter of 2004. The index value for the first quarter was 153.3, down from 157.7 for the fourth quarter 2010; the base index value of 100 was set for the first quarter of 2000.
NRMLA estimates that those 62 or older hold $3.14 trillion in home equity as of June 30. During the quarter, aggregate senior housing values declined by 1.6% to $4.16 trillion, while senior debt outstanding was $1.02 trillion.
At the start of the year, seniors held $3.3 trillion in home equity; three months later it fell to $3.2 trillion.
When the index started in the first quarter 2000, seniors had $2.1 trillion in home equity. At the peak, in the fourth quarter of 2006, they held over $4 trillion.
NRMLA president Peter Bell said in a press release, “While the senior equity level is 22% off of its second quarter 2006 peak, the equity level of the overall population is down 38% from its first quarter 2006 peak.” He said the difference is “due to the relatively fast growth and lower mortgage debt levels of the senior population.”
