Examining the Underserved HECM Market

by Shannon Hicks
| One Comment
| October 17, 2016

MIT study reveals more detail about potential HECM market

We’ve heard for years that the Home Equity Conversion Mortgage has only been utilized by 2% of retired homeowners. We also know that reverse mortgage volume has fallen dramatically from its historic high endorsement volume of 114,000 units in 2009 to 48,900 units for the fiscal year 2016. What is our true market potential of not only age eligible homeowners but those who could potentially qualify.A recent study released by M.I.T. this summer provides a clearer picture of our missing market potential.

This summer, MIT released a 92-page study to estimate the percentage of retired households with sufficient home equity that could best use a reverse mortgage. The study analyzed 3,730 retired households with…

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Editor in Chief: HECMWorld.com

As a prominent commentator and Editor in Chief at HECMWorld.com, Shannon Hicks has played a pivotal role in reshaping the conversation around reverse mortgages. His unique perspectives and deep understanding of the industry have not only educated countless readers but has also contributed to introducing practical strategies utilizing housing wealth with a reverse mortgage.

Shannon’s journey into the world of reverse mortgages began in 2002 as an originator and his prior work in the financial services industry. Shannon has been covering reverse mortgage news stories since 2008 when he launched the podcast HECMWorld Weekly. Later, in 2010 he began producing the weekly video series The Industry Leader Update and Friday’s Food for Thought.

Readers wishing to submit stories or interview requests can reach our team at: info@hecmworld.com.

1 Comment

The_Cynic
October 18, 2016 at 8:20 am
This was an interesting study and should leave no question that the industry has many things to learn about its potential customer base. It would be interesting to know how conservative the researchers were.

Why is our penetration rate so low? Normally supply equals demand in part when the product is priced right. We all know our premiums are priced in part based on our margins.

Could it be that our margins to some degree, hold down demand? They are materially higher than they were seven years.
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