"House Prices May Drop Again"... Record Low First-Time Home Purchases in Q1

The Proportion Occupied by 30% or Less Also Hits an All-Time Low

Due to interest rate hikes and falling house prices, the number of people nationwide who bought a home for the first time in their lives in the first quarter of this year was the lowest ever recorded for a first quarter.

Apartment skyline in Seoul [Image source=Yonhap News]

On the 3rd, Economic Man Lab, a real estate information provider, analyzed court registry information and found that the number of first-time buyers of collective buildings (apartments, multi-family houses, officetels) in the first quarter of this year was 68,105. This is the lowest figure for the first quarter since related statistics began to be compiled in 2010. The number of first-time buyers of collective buildings peaked at 148,961 in the first quarter of 2021, then dropped to 87,660 in the first quarter of last year, and reached a minimum this year.

The proportion of buyers aged 30 and under was also the lowest ever. Among the 68,105 first-time buyers of collective buildings, 36,296 were aged 30 or younger, accounting for 53.3% of the total, which is the lowest level since the statistics began to be compiled.

By region, the number of first-time buyers of collective buildings in Seoul in the first quarter of this year was 5,172, the lowest ever recorded. The numbers were 23,510 in Gyeonggi, 5,635 in Incheon, 4,966 in Busan, 4,698 in Chungnam, and 3,326 in Daegu.

Although the government has introduced loan regulation relaxations and tax reduction benefits for first-time homebuyers, high interest rates and concerns over further declines in house prices are causing actual demand buyers to postpone purchasing their own homes.

Hwang Hansol, a research fellow at Economic Man Lab, said, "While the Bank of Korea’s decision to hold the base interest rate steady has eased the frozen real estate market, unless there is a shift toward interest rate cuts, the increase in actual demand for homeownership may remain limited."

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