Seoul's housing market, dominated by people in their 30s... Gift and inheritance funds surpass 50%

In the first quarter of this year, the Seoul housing market saw a trend of people in their 30s actively using gift, inheritance funds, and proceeds from the sale of financial assets to purchase homes. As housing prices continue to rise and loan restrictions persist, statistics show that the actual demand group in their 30s, who find it difficult to enter the market relying solely on income, is filling the funding gap through family support and disposal of investment assets.

According to the Seoul Housing Purchase Fundraising Plan statistics received by the Office of Congressman Kim Jong-yang of the Land, Infrastructure and Transport Committee, from the Ministry of Land, Infrastructure and Transport, the total amount of gift and inheritance funds used for purchasing Seoul homes in the first quarter (January to March) was 2.1813 trillion won. The housing funding plan is a document filled out at the time of home purchase indicating the source of funds; it must be submitted for all homes within restricted areas, and for homes over 600 million won outside restricted areas, it must be submitted to local authorities within 30 days of contract signing. Submission obligations for restricted areas, including Seoul, have been in effect since October 27, 2020.

Among these, gift and inheritance funds used by people in their 30s to buy Seoul homes amounted to 1.0915 trillion won, accounting for about half of the total. Following closely are people in their 40s with 526.5 billion won, in their 50s with 229.9 billion won, over 60s with 227.8 billion won, in their 20s with 103.3 billion won, and under 20s with 2.2 billion won. The proportion of people in their 30s increased from 34.8% in 2023 to 40.9% in 2024, further expanding to 43.5% last year, and in just the first quarter of this year, this proportion has already exceeded 50%. The total gift and inheritance funds used for purchasing Seoul homes also surged from 1.7451 trillion won in 2023 to 3.3257 trillion won in 2024; last year, it reached a record high of 6.5779 trillion won, and within just three months this year, the amount already accounts for about one-third of last year’s total.

In terms of funding raised through the sale of investment assets such as stocks, bonds, and virtual currencies, the presence of people in their 30s is also very prominent. In the first quarter of this year, funds raised by this group through such means amounted to 721.1 billion won, surpassing the 585.5 billion won from people in their 40s and 464 billion won from those in their 50s. Previously, the 40s, with relatively more accumulated assets, had always held the largest share in this category. In fact, from 2020 to last year, the 40s led in the scale of funds from stock and bond sales, with 1.9151 trillion won last year, compared to 1.7452 trillion won for those in their 30s. However, since February 10 of this year, the fundraising plan application process has included not only stock and bond sales but also virtual currency sales, making the actual funding mobilization ability of people in their 30s more clearly evident.

Experts believe that the rising housing prices in Seoul and financial regulations are the common background for this change. As housing prices increase, initial capital burdens grow, and loan limits are restricted, young first-time homebuyers are turning to support from parents or disposal of their investment assets to purchase homes. This also means that the entry barrier to the Seoul housing market is rising accordingly. This trend is likely to continue depending on Seoul’s housing price levels, the strength of loan restrictions, and the returns of risk assets, including virtual currencies.