National Homeownership Rate Increased Year-on-Year
But Median Income Households Declined by Income Group
In 2022, the nationwide homeownership rate increased, but the homeownership rate among middle-income households declined.
According to the Construction Industry Research Institute on the 28th, an analysis of the Ministry of Land, Infrastructure and Transport's housing survey showed that the nationwide homeownership rate in 2022 was 61.3%, and the home occupancy rate was 57.5%, both rising compared to the previous year. The homeownership rate refers to the proportion of houses owned regardless of residence, while the home occupancy rate refers to the proportion of houses owned and directly lived in by the owner.
View of the Noryangjin redevelopment site in Seoul from the 63 Building observatory. Photo by Hyunmin Kim kimhyun81@
In the metropolitan area, the homeownership rate was 55.8%, and the home occupancy rate was 51.9%, both slightly increasing from the previous year. The homeownership rate in metropolitan cities also rose to 62.8% compared to the previous year, while the home occupancy rate remained steady at 58.7%.
Although housing prices began to decline in the second half of 2022, the homeownership rate among middle-income households decreased, and the proportion of renter households increased. The homeownership rate for middle-income households in 2022 was 65.5%, down 0.3 percentage points from the previous year. The homeownership rates for higher-income and lower-income households increased.
The home occupancy rate for middle-income households fell by 1.0 percentage point, a larger decline compared to other households. The home occupancy rate for higher-income households decreased by 0.4 percentage points, while that for lower-income households rose by 1.0 percentage point.
Regional Homeownership Rates, Homeownership Rates by Income Level (Source: Korea Research Institute for Human Settlements)
In the U.S. housing market, housing prices and homeownership rates have also shown simultaneous rises or falls. The U.S. homeownership rate was 69.2% in 2004 but dropped to 62.9% in the second quarter of 2016 following the financial crisis.
In South Korea, housing prices and homeownership rates also fell together during the financial crisis, with particularly significant declines in the metropolitan area and among middle-income households. The Construction Industry Research Institute explained, "The decline in housing prices in 2022 is also presumed to have proactively influenced the housing choices of middle-income households."
Researcher Heo Yoon-kyung of the Construction Industry Research Institute stated, "Since the decline in housing prices was even greater in 2023, it is necessary to monitor changes in the homeownership rate of middle-income households," adding, "Changes in the homeownership rate of middle-income households indicate social changes from various perspectives, including housing policy, asset markets, and class shifts."
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