A report by South Korea's Ministry of Land, Infrastructure, and Transport reveals that a Korean family would need to save every penny for 13 years in order to afford a home in Seoul, given the current housing market. This stark reality has emerged as housing prices in the capital continue to rise, making homeownership increasingly difficult for average citizens.
The report, which surveyed 61,000 households nationwide from June to December 2023, highlights a concerning trend in housing affordability. According to the data, the median selling price of a home in Seoul is 13 times higher than the median household income.
"Simply put, an employee must save every penny earned for 13 years to purchase a home in the city," the report states.
This housing price-to-income ratio is the highest among all major cities and provinces in South Korea. In comparison, Sejong, the city where the government complex is located, has a housing price-to-income ratio of 8.7, followed by Gyeonggi Province at 7.4 and Daejeon at 7.1.
In Busan and Daegu, the two largest cities outside Seoul, the housing price-to-income ratio stands at 6.7. The lowest ratio in the country is in South Jeolla Province, where it is 3.1.
The growing disparity in housing affordability has led to a decline in homeownership across the country. The share of homeowners fell from 61.3% in 2022 to 60.7% in 2023. In the Seoul metropolitan area, the homeownership rate dropped slightly from 55.8% to 55.1%, while in metropolitan cities outside Seoul, it decreased from 62.8% to 62.3%. In the provinces, the drop was from 69.1% to 68.6%.
The skyrocketing housing prices in Seoul are part of a larger trend that has been developing over the past decade. Factors such as population growth in the capital, limited land for new housing, and speculative investment in the real estate market have all contributed to the surge in prices. As a result, many young South Koreans are finding it increasingly difficult to purchase a home, forcing many to delay marriage or consider living in smaller towns or suburban areas far from Seoul.
The government’s response to this issue has included initiatives to increase housing supply, implement price controls, and introduce policies aimed at improving affordability. However, critics argue that these measures have yet to make a significant impact, and the situation remains dire for many middle-income families.
While Seoul continues to dominate as the center of economic and job opportunities, the high housing costs have also contributed to a growing regional divide. Young people, in particular, are increasingly moving to cities with more affordable housing options, such as Busan, Daegu, and Gyeonggi Province. However, the desire to live and work in Seoul, coupled with the city’s status as the nation’s economic hub, means the demand for housing remains high, keeping prices up.
