Young People Give up on Buying Apartments

  • By Shin Su-ji

    August 03, 2022 12:58

    The number of younger Koreans who borrow heavily to buy their first home has fallen to a record low.
    The trend appears to be due to an increase in interest rates on housing loans while apartment prices remain high despite paralysis in the market.
    According to the Korea Real Estate Board on Tuesday, 24.8 percent of the paltry 2,014 buyers of apartments in Seoul in June were under 30.
    In 2019, buyers in their 20s and 30s accounted for around 30 percent of apartment purchases in Seoul, but the figure rose rapidly to 40.3 percent in 2020 and to 44.8 percent in 2021 amid panic buying triggered by fears that prices would spiral out of control. It remained in the low 40-percent range early this year but fell to 37.3 percent in May.
    The number of first-time buyers also fell to a nine-year low due to rising interest rates. According to the Supreme Court registry, 32,605 people bought their first home last month, the fewest since January 2013.
    After rising to a monthly average of 56,856 in 2021, the number of first-time home buyers fell to 40,459 in January this year and has stood below 40,000 since February.
    Realtor Kwon Il said, "Interest rates are expected to rise further in the second half of this year and young buyers won't be able to flock back into the market any time soon."
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