NEW YORK: Senior citizens have more equity in their homes than at any period since the financial crisis, giving rise to reverse mortgage potential, says an international study. In the third quarter of 2014, equity levels rose to their highest level since the third quarter of 2007.
The measuring index finished the period at 183.87. A $94.6 billion increase in senior home equity in the third quarter was driven by an estimated $97.8 billion increase in the aggregate value of senior housing offset by a $3.2 billion increase in mortgage debt held by seniors.
The third quarter of 2014 was the tenth consecutive quarter in which the index has risen, and the $3.84 trillion estimated aggregate value of home equity owned by seniors eligible for reverse mortgages is now just 4% below its peak level of $4.0 trillion in Q4 2006.
The current levels represent a 30% recovery since the financial crisis when seniors’ equity levels had fallen to an estimated $3 trillion…