Older Americans are sitting on over 14 trillion in equity
Didier Malagies • November 24, 2025
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What the Trend Is
- Huge Senior-Held Home Equity
- Older Americans are sitting on a lot of home equity — reports suggest more than $14 trillion. HousingWire+2National Mortgage Professional+2
- This represents a big source of wealth that could potentially be mobilized for other uses — including helping younger generations.
- Helping the Next Generation Buy Homes
- According to a recent discussion of this phenomenon, more seniors are using their equity to help their adult children buy homes. HousingWire
- For example, some are taking out reverse mortgages or other home-equity loans and using the proceeds to provide down payments. HousingWire+1
- There are real-life stories: one couple gave their daughter over $600,000 for a down payment so she could stay in a high-cost area (rather than having to move somewhere cheaper).
- According to the National Association of Realtors (NAR), 1 in 4 first-time buyers are getting some family assistance.
- Motivations and Risks
- On the one hand, this can be a strategic way for older generations to pass on wealth in a way that helps with their children’s long-term prospects.
- On the other hand, tapping too much equity can risk reducing the senior’s resources in retirement (less cushion for medical costs, maintenance, or other needs).
- There’s also the risk profile of certain home-equity products: reverse mortgages, for example, have specific terms, costs, and potential trade-offs.
- Wider Implications
- This trend reflects broader intergenerational wealth dynamics: as housing becomes less affordable, the “bank of Mom and Dad” is playing an increasingly important role.
- At the same time, relying on family help to get into homeownership might exacerbate housing inequality: not everyone has parents or family with large equity.
- There’s also a policy dimension: how financial products (like reverse mortgages) are regulated, and whether there are incentives or protections for seniors who choose to use their equity to help others.
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My Thoughts / Analysis
- This trend makes sense in the current housing environment: for many younger buyers, it’s very hard to accumulate enough savings for a down payment, so family help can be a lifeline.
- For seniors, using home equity this way can be seen not just as “spending” but as investing in their family, especially if they view this as a legacy or want to help their children stay in certain areas.
- But it’s not risk-free: the decision should be made carefully, ideally with financial planning. Seniors need to balance current needs, future costs, and how much they’re willing to give up.
- From a policy/market standpoint, this could be a growing area of tension: how to support intergenerational wealth transfer without creating dependency or encouraging risky borrowing.
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There are now more loans with interest rates over 6% than those with rates under 3%. 40% of the volume closed were refinances, and 30% of the loans done were NON-QM loans. There was a 10% drop in mortgage volume at the end of 2025, with a drop in interest rates. With 1.4 trillion in credit card debt, it seems that 1.4 trillion in credit card debt may be the reason for the refinancing. It is interesting that the NON QM loans captured so much of the closed business, and will only grow more in 2026 Popular program is the bank statement loan, which does not require tax returns, 1099's or W-2s If you are looking at doing a rate term refinance, remember to look for a 2% drop with no points tune in and learn https://www.ddamortgage.com/blog didier malagies nmls#212566 dda mortgage nmls#324329
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