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.