Save up to 63 years to be able to buy an apartment in Seoul

Specifically, an average worker here will have to save about 63 years to buy an apartment, according to statistics in 2020-2021. This number is much higher than in 2019, when a worker here would have to save about 63 years to buy an apartment. Ordinary workers only have to save about 22 years.

Data from the General Statistics Office of Korea and KB Kookmin Bank show that the average salary of workers in 2021 is about 1.49 million Won. Meanwhile, the average price of an apartment in Seoul at a time when real estate is soaring can reach 1.99 billion won.

The ChosunIlbo newspaper reported that the average income of Korean workers in the past five years has increased by 14.4% to 5.37 million won per month, while their average spending has increased by 10.2% to 3. .89 million Won per month. However, house prices in Seoul have increased by 98%, at the time of the census.

Deliberately quitting work to buy subsidized housing

Baek Seung Min, a 35-year-old design professional, asked his wife to quit her job as a nurse during the Covid-19 pandemic. The reason is not because he is worried about the risk of disease, but to meet the requirements to buy a house for low-income people.

This irony takes place after the Korean government issued a few new regulations in an attempt to cool down the real estate market. Accordingly, low-cost housing projects will give priority to low-income households. Therefore, if his wife quits her nursing job with a salary of 58 million Won, the family will be eligible for approval.

However, the Baek family could not find a satisfactory home in Seoul, so they had to move back to Incheon to work towards affordable housing projects.

“House prices in Seoul have increased too high for us, my family has to go all the way to Incheon to buy a house,” said Mr. Baek sadly.

According to Reuters news agency, despite more than 20 new government regulations to cool down real estate, house prices in Seoul in 2020 have increased by more than 50% since 2017. This was the highest in the world at that time.

This situation has caused many families to cut their spending, even marry without registration to be able to submit 2 documents to buy a cheap house.

Average apartment price in Seoul (Ten thousand Won) in the 10-year period from 2010 to 2020. Photo: Reuters

Mr. Hong Seoung-kyun (28 years old) born and raised in the capital Seoul, once made his first priority when starting to live independently, having a house of his own. However, this dream is increasingly difficult to realize with the current housing price situation.

After many years of accumulation, he saved about 15 million Won (nearly 13,370 USD) but this money could only help him earn a 12 square meter studio apartment, for 500,000 Won/month and a deposit of 5 million Won. .

Hong Seoung-kyun shared with the Korea Herald, “In movies, people my age usually work in high-paying jobs and live in large houses. In real life, I have to huddle in a tiny room, eating instant noodles while dreaming of such a life.”

The middle class also has a “headache” because of the pressure to buy a house

In the decades since the end of the war, Koreans have believed that a college degree and a home are the prerequisites to quickly becoming middle class. Possessing these two things, they will be appreciated as successful people in their career. This is why three-quarters of households’ wealth is often concentrated in real estate.

But today, people born into ordinary families, without good financial conditions, are facing a lot of difficulties in buying a house. Even if they graduate from university and get a stable job with a high salary, buying an apartment in Seoul is still very difficult.

According to Reuters, the average South Korean household will take 14 years to spend all of their income, not spending anything, to be able to own an apartment in Seoul. In 2017, the number was 11 years. If the household has to spend on daily living, pay for education, investment… then this number will increase even higher.

Lawyer Hong Na Ri, who rents a three-bedroom apartment with her two children and husband in Seoul, said house prices are worrying the whole family. The rent for Hong Na Ri’s apartment has doubled to 1.8 million won since the family moved here in 2015.

Meanwhile, the income of lawyer Hong’s family is about 10,000 USD, belonging to the middle class like many other families. However, worry is still standing in her mind when looking at housing and real estate prices increasing rapidly.

“When I got married and moved here in 2015, I thought house prices would go down. Now everyone asks me why I don’t buy a house for my children early while I can. It made me very insecure but there was nothing I could do. I can’t move outside of Seoul because then, the distance from the current school, company or babysitter is too far,” Hong lamented.

*According to News Today63