"Apartments Are a Distant Dream: Villas Become a Dead End for 2030 Generation"

Young People Face Slim Chances of Winning 30,000 Pre-Subscription Units
Buying Villas to Secure Minimum Housing Stability
Jeonse Crisis Triggered by New Lease Law Ignites Market

The view of a villa neighborhood from a building in Yangcheon-gu, Seoul, where villa transaction volumes are increasing on the 11th. Photo by Mun Ho-nam munonam@

#A in their 30s, a salaried worker preparing for a wedding this fall, gave up the dream of starting a newlywed life in an apartment. No matter how much they calculated, it was difficult to overcome the reality that even small apartments on the outskirts of Seoul were priced over 700 million won. A said, "Due to the nature of my job requiring early morning commutes, living in Gyeonggi-do is impossible, so I am looking into newly built villas." The buying frenzy among the 2030 generation spreading to non-apartment housing is being analyzed as a ‘dead-end’ in securing their own home. While Seoul apartment prices are soaring, the new lease protection law has worsened the jeonse (long-term deposit lease) crisis. For those with slim chances of winning housing lotteries and insufficient funds, buying villas has become a choice without alternatives.

◇2030, Turning to Villas Instead of the Unreachable Apartments= According to the Seoul Real Estate Information Plaza, the number of multi-family and row house sales in July was 3,594, over 400 more than apartments (3,182). Although the number is expected to rise as reporting deadlines remain, this trend is unlikely to change since the comparison is based on the same period for both types of transactions. Seoul has about 1.72 million apartment units, double the 880,000 multi-family and row house units. Typically, apartment transaction volumes exceed those of multi-family and row houses. However, since January this year, the transaction volume reversal has continued for six consecutive months. As Seoul apartment sale and jeonse prices soar, lower-income residents unable to afford them are turning their eyes to multi-family and row houses, commonly called villas.

Especially, the proportion of villa purchases by those under 30 is increasing, driving price rises. Compared to apartments, villas lack infrastructure such as green spaces, playgrounds, and parking lots. Nevertheless, the 2030 generation is reluctantly buying villas to secure at least minimal residential stability through homeownership.

◇Government Policies Are False Hope= The government has introduced pre-sale options like the 3rd New Towns, urging people to "wait." However, most of the 2030 generation who choose to buy villas are ‘cheongpojok’?those who have given up on housing lotteries. If marriage or childbearing conditions are not met, even the 30,000 pre-sale units amount to nothing but false hope. Moreover, the supply in central Seoul, where the 2030 generation desires to live, is limited, worsening the supply-demand imbalance.

Recently, B, a salaried worker in their 30s who purchased a newly built villa in a redevelopment release area in northern Seoul, said, "For people like me, unmarried but earning a decent income as a ‘dirt spoon’ in a large corporation, housing lotteries are meaningless. I used my savings and housing lottery account to buy a villa that might become an apartment in about ten years."

◇Soaring Jeonse Prices Fuel Panic Buying= The jeonse crisis triggered by the new lease law is fueling villa purchases among the 2030 generation. According to KB Real Estate Monthly Price Trends, the average jeonse price for Seoul apartments in July was 634.83 million won, up 135.62 million won from 499.22 million won in July last year when the new lease law was implemented. This increase is 3.8 times higher than the 35.68 million won rise during the previous year (July 2019 to July 2020).

Song Seung-hyun, head of Urban and Economic Research, said, "The 2030 generation faces limits in available funds due to loan regulations and low housing lottery scores, making it difficult to aim for apartments through lotteries. Many are buying old villas hoping for redevelopment and future apartment occupancy, alongside newly built villas, as the government promotes redevelopment recently."

This content was produced with the assistance of AI translation services.