Despite the rise in home equity to record highs, total mortgage debt has seen a slight decline from $13.4 trillion in 2012 to $13.3 trillion in 2024. This trend is attributed to historically low mortgage rates, which contribute to reduced refinancing activity. While many households experience wealth gains, this has resulted in a stagnant market as homeowners hold onto their equity. The reverse mortgage sector, particularly Home Equity Conversion Mortgages, has shown resilience, with only a marginal drop in endorsements, reflecting ongoing opportunities amid economic challenges.
Home Equity Conversion Mortgage (HECM) endorsements dropped by only 1% in May to 2,296 loans, showing their resilience despite a stressed housing market.
Record-high home equity has uneven benefits on the housing market; while many households gain wealth, the low incentive to refinance slows market activity.
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