Retirement

While home equity is a concern for every homeowner, seniors often rely on their equity as supplement for their retirement income.

Home Values for Seniors Slowly Rising

According to the Buffalo News, the Standard & Poor's/Case-Shiller 20-city home price index rose for the eighth month in a row. Home prices rose in 12 cities on the index, with Los Angeles realizing the biggest monthly gain at 1.8 percent from December values. The same article reported that prices were nearly 4 percent higher than the May 2009 low, yet 30 percent below the record home values from May 2006.

Home Values May Be Increasing for Seniors

An Altos Research report, reported by Forbes Magazine, put together data to pinpoint where home prices are increasing the most. Their top ten list includes:

  1. Lexington, Massachusetts
  2. Bay Village, Ohio
  3. Sunnyvale, California
  4. Poway, California
  5. University City, Missouri
  6. Ambler, Pennsylvania
  7. Allison Park, Pennsylvania
  8. New Braunfels, Texas
  9. Kemp, Texas
  10. Arcadia, California

Reverse Mortgage Options

Seniors age 62 and older applying for a reverse mortgage qualify for a particular loan based on the equity in their home and their age, so this makes home values even more important to reverse mortgage applicants.

Reverse mortgage lenders offer borrowers several choices for accessing the equity in their home: a lump sum upfront payment, a monthly income or a line of credit. Some borrowers opt for a combination of these options. For example, if the homeowners want a lump sum amount to pay off debt, or to make a home improvement, they can use some of their equity right away, and reserve the rest for a line of credit or monthly income.

Michele Lerner
Michele Lerner is a freelance writer with twenty years of experience writing articles and web content for newspapers and magazines on topics related to real estate, personal finance and business. Her clients include The Washington Times, Urban Land Magazine, NAREIT's Real Estate Portfolio, and numerous Realtor association publications. Michele's first book, "HOMEBUYING: Tough Times, First Time, Any Time" is available now at Amazon.com or from www.MicheleLerner.com.

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