Frozen Real Estate Market... Sharp Drop in Housing Transactions Among Under-30s

'KDI Real Estate Market Trends' Report
Proportion of Home Sales Transactions Under Age 30, Q1 25.3% → April-May 24.7%

[Image source=Yonhap News]

[Asia Economy Sejong=Reporter Kwon Haeyoung] Due to the impact of interest rate hikes, the domestic real estate market is rapidly cooling down, resulting in a decrease in the proportion of housing transactions among those aged 30 and under.

According to the 'KDI Real Estate Market Trends' report by the Korea Development Institute (KDI) on the 30th, the proportion of housing transactions among those aged 30 and under in April-May this year was 24.7%. This marks a continuous decline following 27.8% in Q3 last year, 25.7% in Q4, and 25.3% in Q1 this year.

On the other hand, the proportion of housing transactions among those in their 50s increased by 0.3 percentage points from 21.4% in Q1 to 22.0% in April-May. The proportion among those aged 60 and above rose slightly from 22.8% to 22.9% during the same period, while the 40s age group maintained the same level at 21.4%.

The housing market freeze caused by interest rate hikes is interpreted as a reduction in chase buying by younger age groups aged 30 and under.

Nationwide housing transactions in April-May this year also decreased by more than 35% compared to a year ago. During this period, housing transactions recorded 122,000 units, down 36.2% from 191,000 units in the same period last year. Compared to the average of the same period over the past three years (154,000 units), this is a 21% decrease. In the metropolitan area, centered on Northeast Seoul, Gyeonggi, and Incheon, transactions dropped by 46.3% to 50,000 units, while in non-metropolitan areas, mainly Daegu and Daejeon, transactions decreased by 26.7% to 72,000 units across most regions.

KDI analyzed, "Due to uncertainty over further interest rate hikes, buyers have remained cautious, leading to a significant decrease in transaction volume," and added, "Housing transaction volume in April-May fell by 30% compared to the boom period of 2020-2021."

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