South Korea: High housing prices affect the economy

SGGP September 16, 2023 07:04

In its quarterly report to the South Korean National Assembly , the Bank of Korea (BOK) noted that the house price-to-income ratio stood at 26%.

This means the average worker would need to save their entire salary for 26 years to buy a ^90m2 house. This rate has gradually increased from 17.4% in 2020, to 23.6% in 2021 and 29.4% in 2022.

According to the BOK, when compared with basic economic conditions, housing prices in Korea remain high, regardless of income.

Since April this year, household loans issued by banks have been steadily rising to worrying levels. As of August, the amount of loans had increased by more than 25 trillion won ($18.8 billion) in just five months, with home mortgages driving the overall increase.

South Korea's household debt has been rising steadily, to the point where it could threaten financial and microeconomic stability, the BOK report noted.

Source: https://www.sggp.org.vn/han-quoc-gia-nha-dat-do-anh-huong-kinh-te-post705809.html