The financing methods for the 2030 generation entering the Seoul apartment market have evolved. While the first wave of young investors from 2020 to 2021 relied heavily on ultra-low interest rates, credit loans, and overdraft accounts, the recent approach involves liquidating financial assets such as stocks, bonds, and cryptocurrencies to raise capital, supplemented by first-time homebuyer loan limits.
According to data submitted by the Ministry of Land, Infrastructure and Transport to lawmaker Kim Jong-yang of the People Power Party, the amount raised by those in their 30s through the sale of stocks, bonds, and cryptocurrencies for purchasing homes in Seoul reached 721.1 billion won in the first quarter of this year. This figure surpasses the 585.5 billion won raised by those in their 40s and the 464 billion won by those in their 50s. Since 2020, the 40s had consistently led in this category, but this quarter marked the first time the 30s took the top spot.
However, it is important to note that since February of this year, the sale of cryptocurrencies has been included in the funding plan reporting requirements. This change in statistical criteria may affect comparisons with past figures. Nevertheless, it is noteworthy that the 30s have allocated more financial assets toward home purchases than the relatively wealthier 40s and 50s.
After liquidating their financial assets, buyers maximized their loan limits. Although the loan-to-value ratio (LTV) for general housing loans in regulated areas has decreased following the 10-15 measures, the limit for first-time buyers remains at 70%. In a climate where borrowing thresholds for general buyers have increased, the first-time homebuyer loan has become an exception allowing the 2030 generation to enter the Seoul apartment market.
In fact, the number of individuals in their 30s purchasing multi-unit buildings for the first time in Seoul reached 12,403 in the first quarter of this year, doubling from 6,167 in the same period last year. This is the highest number since the first quarter of 2021, when demand surged during the COVID-19 pandemic, which saw 13,438 buyers. This trend suggests that despite high interest rates and lending restrictions, demand concentrated on utilizing first-time homebuyer benefits remains strong in the market.
The Bank of Korea's household debt statistics also confirm this trend. In the first quarter of this year, the average new housing loan for borrowers in their 30s reached 289.9 million won, the highest on record. The share of new housing loans taken by those in their 30s also increased to 41.4%, up from 37.1% in the previous quarter.
Recently, the approach of the 2030 generation has shifted from "using loans instead of stocks and cryptocurrencies" to "liquidating stocks and cryptocurrencies and then adding loans." While the previous trend of aggressively accumulating credit loans and overdrafts has diminished, the practice of liquidating financial assets and utilizing available loans still reflects a strong leveraging characteristic.
A real estate agent in a mid-range apartment area in Seoul noted, "Recently, buyers in their 30s often check their loan eligibility first and then liquidate stocks or cryptocurrencies to make up any cash shortfall. Although the atmosphere is not as aggressive as before in terms of taking out large credit loans, the tendency to liquidate financial assets and add first-time homebuyer loans remains strong."
* This article has been translated by AI.
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