Aging and the Income Value of Housing Wealth / Steven F. Venti, David A. Wise.

Format:

Book

Author/Creator:

Venti, Steven F.

Contributor:

National Bureau of Economic Research.

Wise, David A.

Series:

Working Paper Series (National Bureau of Economic Research) no. w3547.

NBER working paper series no. w3547

Language:

English

Physical Description:

1 online resource: illustrations (black and white);

Place of Publication:

Cambridge, Mass. National Bureau of Economic Research 1990.

Summary:

The potential of reverse annuity mortgages to increase the current income of the elderly is analyzed. We conclude that most low-income elderly also have little housing equity, although this is not always the case. In general, a reverse annuity mortgage would substantially affect the income only of the single elderly who are very old -- whose life expectancy is short. On the other hand, if the transfer were in the form of a lump sum amount -- rather than an annuity -- the payment would increase the liquid wealth of most elderly families by a large fraction. Thus legislation that would facilitate the market for reverse mortgages could improve substantially the financial status of a small proportion of the elderly. But the specter of a large number of poor widows with vast amounts of "locked-in" housing equity does not reflect the reality. Most low-income elderly have relatively little housing wealth.

Notes:

Print version record

December 1990.