The 'big players' in their 30s have returned to the Seoul real estate market. In May this year, people in their 30s purchased the most apartments in 20 months since September 2021. As various regulations were eased and the special Bogeumjari Loan was introduced, demand for switching homes and buying first homes revived, leading to a gradual rise in Seoul housing prices.
According to the Korea Real Estate Board on the 5th, out of a total of 3,711 apartment transactions in Seoul in May, 1,286 were made by people in their 30s. This is the highest number in 20 months since 1,505 transactions in September 2021.
Apartment purchases by people in their 30s in Seoul shrank to 171 transactions in November last year due to the impact of high interest rates originating from the U.S. However, as the real estate market gradually recovered recently, the number exceeded 1,000 in March this year and surpassed 1,200 in May.
Unlike the nationwide apartment market dominated by people in their 40s, in Seoul, those in their 30s are called the big players who influence apartment prices. They usually have the highest purchase volume and respond more sensitively to the real estate market atmosphere than any other generation. The purchase share of people in their 30s, which maintained around 30% during the real estate boom, dropped to the low 20% range in the second half of last year when housing prices sharply declined, and recently rose to the mid-30% range. It recorded 35.2% in April and 34.7% in May. Seoul apartment prices turned upward in May after 15 months since February last year, coinciding with the surge in purchases by people in their 30s, and continue to rise.
The recent increase in purchases by people in their 30s is interpreted institutionally as a result of interest rate stabilization due to consecutive base rate freezes and the easing of various loan and tax regulations under the 1·3 measures. Currently, all areas except Gangnam-gu, Seocho-gu, Songpa-gu, and Yongsan-gu in Seoul have been removed from regulated zones, lowering the threshold for home purchases. The introduction of the special Bogeumjari Loan also led to increased purchases of mid- to low-priced apartments by people in their 30s. The special Bogeumjari Loan allows buyers of homes priced under 900 million KRW to borrow up to 500 million KRW at a low fixed interest rate regardless of income level. Additionally, psychological factors such as growing desire to own a home due to the spread of jeonse fraud and the perception that housing prices have bottomed out, increasing demand to upgrade to better areas, have also attracted buying momentum among people in their 30s.
Yeokyung Lee, Senior Researcher at Real Estate R114, explained, "People in their 30s have less capital compared to middle-aged groups, so they respond more sensitively to the market considering their borrowing capacity. It seems that the perception of a price bottom spreading in the Seoul apartment market recently has significantly increased purchases by people in their 30s."
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