Reverse Mortgage Industry Trends – April 2010
June 16, 2010
We’ve been talking the past few months about a few specific markets around the country that have weathered the storm of decreased volume, most notably Baltimore. Rather than beat the Baltimore drum another month, let’s talk about a slightly different topic that caught our interest this past month.
We’ve been underwhelmed by the volume (or lack thereof) of HECMs for home purchase since the program’s introduction but we think it’s time to look a little closer at what’s happened thus far. But while the total has been uninspiring, the trend is definitely headed in the right direction.
Take a look at the chart below for an illustration how this tiny niche of the HECM market grew over the course of 2010.
The market grew nicely over the year even as principal limits were reduced in October, although it’s very early to tell whether HECM Purchase is more or less affected by those changes. Another interesting way to look at the volume is to see where the product is doing well geographically, as illustrated below.
It’s perhaps no surprise to see some of the leading HECM states in CA and FL take charge here as well, but if you’re doing business in either of these states perhaps these charts can help you point out the value of HECM Purchase to your business network. HECMs assisted in closing over 1,200 home sale transactions last year for almost $325 million in home value.
It’s a small number today, but it points the way toward incremental growth both for our own senior market and for real estate business partners.
Click on the image below to view the full Industry Trends report for this month.
Thank you so much for just being there as a resource. I’m a Realtor in Florida and I’ve been dumbfounded by the lack of information and knowledge that my industry has exhibited in this area. No wonder there have only been 1,200 Purchases. Very few people in Real Estate know much.
Over the past four months I’ve surveyed 11,000 fellow Realtors in Florida, NY, MA, NJ, MO and IL. I sent most of them emails but I’ve had the opportunity to speak with dozens of fellow agents. Mind you, I don’t do mortgages. I am strictly an interested party with only the interest of my clients at heart.
Not only were the Realtors unaware of the Jan.1, 2009 intro of the HECM Purchase, but I could find no reference to it in the National, State or my own local Realtor association web sites. In conversations with your industry people I learned that many of the Purchase transactions they came into were instigated by knowledgable consumers who had to ‘pull’ their Realtors along. So I decided to do something about it.
With the content editorial review and criticism of several RM specialists I wrote and launched a beta site for the education of both my fellow agents and the consumer on the subject of the HECM Purchase. Use the password HECM2010 to visit it at http://www.belgeriassociates.com/floridamovesboomers/firstre I will continue to promote the program to my fellow Realtors and your data will be most helpful. Thanks.