For 28-year-old Hong Seong-kyun, buying a home in Seoul has been near the top of his bucket list for years, even before he started worrying about getting a job in the city.
Born and raised in Seoul, he thought owning an apartment, however small it might be, was not a far-fetched dream. But years later, he has come to know otherwise. Hong now has about 15 million won ($13,370) sitting in his savings account, which guarantees nothing when it comes to housing.
The 28-year-old spends about eight hours a day inside a 12-square-meter studio apartment when he is not at his part-time job at a coffee shop. Even this tiny space costs Hong 500,000 won per month on top of his 5 million won deposit.
“In evening dramas or movies, people my age with law degrees or those who have landed high-paying jobs as consultants or bankers get off work and find themselves inside houses as big as soccer fields, but I know too well that’s nothing close to my reality,” Hong said.
“In my reality, I am cornered inside a tiny studio watching that fantasy through a smartphone while chowing down on instant noodles. The fact that I’m not the only person living like this is probably the last remaining hope for me.”
According to a survey carried out in August by Honjok King, a local service operator for those living alone, 78.6 percent of respondents between the ages of 26 and 30 said they lived in officetel units or studios. The rate stood at 45.1 percent for people between 31 and 35, and 61.8 percent for people between 20 and 25.
In Seoul, studio apartments are often less than 20 square meters and rent is 500,000 won a month or more. And even that is out of reach for many, who struggle to land jobs that offer a stable monthly income.
With housing prices skyrocketing throughout Seoul, the entry barriers to the capital’s real estate market are getting higher and higher. The city may not be very welcoming to its residents, but it is especially hostile to newcomers.
Like Hong, many young South Koreans are sustaining their lives through part-time or temporary jobs, with distant hopes of landing full-time jobs and starting real careers. Finding such jobs in Seoul has been difficult for many years, but COVID-19 has pushed things to a new level.
According to Statistics Korea, the number of jobless people in their 20s and 30s reached 627,000 in March, up 63,000 from a year earlier. The number of people in that age group who were “taking a break” from work reached 648,000 the same month.
“I’m scared to tell my parents now that I failed another job interview, but it is what it is,” said Cha Dong-min, a 29-year-old graduate of a Seoul-based university who has been living with his parents in Daejeon since graduating last year.
He is looking for a public relations job, but none of the applications he’s submitted have met with success.
“If I don’t have a job, I can’t pay the monthly rent, but I do want to find a job in Seoul. That’s where everyone is and where everything is, and being there could likely increase my chances of getting a job in Seoul.”
Cha said even his efforts to find a part-time job at a fast food place or convenience store in Seoul had been unsuccessful. Demand for workers at such establishments has diminished with the pandemic, with some closing down and others shortening their hours.
“Of course, I want to stay in Seoul while applying for jobs,” he added. “But I simply can’t ask my parents to invest more without knowing the prospects of it, so for the time being, I will be staying here.”
Many real estate agents agree that it is increasingly difficult for young people to find a place to live in Seoul. But the game is becoming more extreme, as the wealthy stay wealthy while the poor become more desperate.
“I’ve seen many college graduates coming to my office asking if anything is offered for 300,000 won per month, and I tell you, that is absurd even for this area,” said Lee Bok-ea, a real estate agent based in Noryangjin, southern Seoul.
“But at the same time, I’ve seen some college graduates with handsome amounts of cash on their hands looking for rather expensive jeonse or monthly lease deals.” A jeonse contract involves a large lump-sum deposit in lieu of monthly rent.
Lee said she noticed that job seekers and young people just starting their careers are off to a better start if they’re backed by wealthy parents, as they do not have to worry about bleeding out rent every month on top of paying interest on a loan to pay a housing deposit.
For someone without support from parents, even if they manage to land a full-time job in the city, eventually owning an apartment in Seoul is nearly impossible. It is far out of reach for most young people, especially with the unprecedented rise in housing prices under the incumbent administration.
According to KB Kookmin Bank, the median price of an apartment in Seoul was 964.8 million won as of February, while Koreans earned an annual average of 37.4 million won last year.
This means that an average person would have to save for close to 26 years without spending anything just to afford a midrange apartment. In the meantime, of course, apartment prices would rise further and homeownership would remain out of reach.
“I say buy whatever is out there if you have the money for it. The price is going to keep rising while the Moon Jae-in administration stays in power,” said another real estate agent based in Yeongdeungpo-gu, western Seoul, when asked what properties would be realistic targets for young workers.
“But as you probably saw on most websites, there’s really nothing you can buy with your own cash. By the time you think you have enough, the price is going to shoot up again. It’s probably better for your health to give up on the idea as a whole.”
In response to concerns from the younger generation, the Seoul city government and related agencies are preparing affordable housing near subway stations for young people to live in.
These units, provided to young singles and married couples under 40, are up to 40 percent cheaper than nearby housing options and loans are offered on relatively favorable terms.
Landing one of these, however, is a long shot. The competition for a government-led apartment project in Gwangjin-gu, eastern Seoul, in 2019 was 1 to 140; for a similar project in Seodaemun-gu, western Seoul, the same year it was 1 to 122.
Experts have voiced the need for an increased supply of affordable housing in Seoul to address the issue. This is part of Seoul Mayor Oh Se-hoon’s plan since taking office last month.
Oh has prioritized overhauling the city’s housing policy and creating 360,000 new housing units to resolve the supply crunch, which turned public sentiment against the Moon administration and contributed to Oh’s landslide election win.
Yet some young Seoul residents remain pessimistic, as they believe that no government has ever really cared about or paid attention to the younger generation.
“It could be the same stuff all over again,” said Jeong Sang-jun, a 31-year-old accountant based in Mapo-gu, western Seoul, who lives in a one-bedroom apartment through a jeonse deal.
“As far as I’m concerned, every politician vowed the same when running for election but really didn’t do much after taking office. We will have to see if this was all sugar-coated or not.”
By Ko Jun-tae (email@example.com