A study of the effectiveness of the Hong Kong reverse mortgage scheme on improving the standard of living for the elderly

Abstract

The population of Hong Kong is getting aged which causes a number of social problem and increasing government expenses. These include decline of workforce, increase demand in health care & social facilities. For individual elderly, the longer life expectancy implied an increasing retirement life and subsequent expenditures. One of the ways to solve the problem is reverse mortgage. It is a financial scheme that helps liquidate the home asset of the elderly homeowner in return of a stable cash stream; by using the self-occupied home as collateral while the elderly are still allowed to line in this home. The objective of this study aims at evaluation the performance of the Hong Kong Reverse Mortgage scheme on improving the standard of living of elderly. The quality of life was adopted as object of value of the standard of living while four dimensions: Life Satisfaction, Self-Esteem, General Health Care & Functional Status and Socioeconomic Status were adopted for measuring quality of life of the elderly. A questionnaire survey was conducted to obtain the opinion on the Hong Kong Reverse Mortgage Scheme. As a whole, the respondents provide a positive feedback and tend to agreed that the Hong Kong Reverse Mortgage scheme help improving the standard of living. In addition, respondents were found particular positive towards the special feature of the Hong Kong Reverse Mortgage scheme: the flexible bequest arrangement and the deferred payment arrangement. Moreover, it was also observed that Tenure Choice was negatively associated with the Age of respondents while the evaluation of effectiveness of the scheme was positively associated with the income change after engaged in the Hong Kong Reverse Mortgage scheme. In depth interviews were also conducted to obtain the opinions of other persons that closely related the Hong Kong Reverse Mortgage scheme. Result suggested that the first reverse mortgage product in Hong Kong is on the right track and more effort should be spend to promote the scheme to the local elderly homeowners. The direction of future study may include other object of values and the corresponding measurement dimensions.published_or_final_versionHousing ManagementMasterMaster of Housing Managemen