Under-Teens Also Purchased 2,000 Homes Over 3 Years, Totaling 354.1 Billion KRW
Assemblyman Kim Hoe-jae: "Unreasonable Wealth Gap, Must Alleviate Through Fiscal Investment"
[Asia Economy Reporter Jo Gang-wook] It has been revealed that the amount spent on home purchases by those aged 20 and under has reached tens of trillions of won over the past three years. There are calls for drastic measures to reduce the asset gap.
According to data on ‘Home Purchase Status by Age Group’ submitted by the Korea Real Estate Board to Kim Hoe-jae, a member of the Democratic Party of Korea, the number of home purchases by those aged 20 and under since January 2019, when age-specific home purchase statistics began, until August this year, totaled 141,851 cases.
In particular, the amount spent by the 20-and-under age group to purchase these approximately 140,000 homes reached 35.0537 trillion won.
The number of home purchases and the purchase amount for those aged 20 and under have been steadily increasing.
In 2019, the number of homes purchased by those aged 20 and under was 35,270, with a purchase amount of 7.7009 trillion won. This expanded to 61,919 cases and 15.6479 trillion won in 2020. As of August this year, those aged 20 and under purchased 44,662 homes, spending 11.7048 trillion won.
If this trend continues, it is estimated that by the end of this year, the number of home purchases by those aged 20 and under will reach 66,993 cases, with a purchase amount of 17.5572 trillion won. This represents an increase of 89.9% in the number of cases and 128.0% in purchase amount compared to 2019.
The number of homes purchased by those aged 10 and under over the past three years also reached 2,006 cases. The total purchase amount was 354.1 billion won.
Similar to those in their 20s, home purchases by those aged 10 and under are also on the rise. The number of homes purchased, which was only 332 cases in 2019, increased to 728 cases in 2020, and as of August this year, it has already recorded 946 cases, surpassing last year. The purchase amount rose from 63.8 billion won in 2019 to 154.9 billion won as of August 2021, more than doubling.
It is estimated that the majority of home purchases by those aged 20 and under, who have low incomes, are thanks to the ‘family chance.’ According to the Ministry of Land, Infrastructure and Transport’s housing fund procurement plan, 59.8% of homebuyers under the age of 10 procured housing funds through gifts.
Kim pointed out that the real estate gap caused by the ‘family chance’ is even leading to an asset gap.
Analyzing the asset gap of the MZ generation through microdata from Statistics Korea, Kim found that the asset quintile ratio of households in their 20s was 38.92 times last year. This is a deterioration of 5.5 percentage points compared to 33.42 times the previous year.
The quintile ratio is the value obtained by dividing the average assets of the top 20% by the average assets of the bottom 20%, and a larger multiple indicates worsening inequality.
Kim emphasized, “It is unreasonable that the low-income age group of 20 and under has purchased hundreds of thousands of homes worth tens of trillions of won. The asset gap is even stealing the dreams of young people. Drastic financial investment is needed to reduce disparities among youth in jobs, housing, and asset formation.”
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