engleski

nalysis of demographic and socio-economic trends significant for the European reverse mortgage industry development potential

A reverse mortgage is an innovative financial product intended for senior homeowners meant to assist them in financing a wide spectrum of everyday needs, primarily when other sources of funds in the form of savings, return on investments, or current income are insufficient to cover especially urgent or financially intensive costs. This product is, until today, present and used mostly in developed countries, predominantly in the USA, although both the perspective and a real need for its implementation, or offer as a financial possibility, exist in many other developed, as well as in less developed countries. The aim of this paper is to determine European reverse mortgage industry development potential according to the key demographic and socio-economic indicators movements. In different countries, homeownership is the main precondition, but not a guarantee, for reverse mortgage usage among senior population – even if, according to demographic or socio-economic trends, both obvious potential or necessity are present ; yet some other factors, primarily cultural ones, in addition to their potential impact, that often cannot be quantified or analyzed the aforementioned sense, may prove as crucial and must, therefore, be taken into consideration. In this paper, the most important measurable demographic and socio-economic indicators significant for the reverse mortgage industry development potential and trends are identified, compared and analyzed on the sample of 28 EU countries by using descriptive statistics methodology and correlation analysis. The analysis results represent a valuable source of information for governments, both existing and potentially new reverse mortgage creditors and borrowers, pointing at the unused potential of the reverse mortgage and its potential role in solving their problems connected with the consequences of analyzed trends and financing an ageing population. In that sense, a reverse mortgage could not be observed only as a last resort, but as a living condition improvement tool for senior homeowners.

reverse mortgage, demographic, socio-economic, seniors, funding

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