South Korean Baby Boomers Prefer Smaller Apartments

Industry officials believe home buyers in their 50s and 60s are looking towards smaller apartments as they plan to rent them out, or leave them for their children to inherit. (Image: Yonhap)

SEOUL, May 24 (Korea Bizwire) – New statistics show an increasing number of South Korean baby boomers in their 50s are purchasing smaller apartments.

Daewoo Engineering & Construction (Daewoo E&C) teamed up with the industry academic research team at Konkuk University and conducted a big data analysis which revealed that over 36 percent of buyers of small homes that are 40 to 50 square meters in size are in their 50s.

Home buyers in their 60s followed closely, accounting for 30.3 percent, while those in their 40s and 30s accounted for 25.8 percent and 7.6 percent, respectively.

Industry officials believe home buyers in their 50s and 60s are looking towards smaller apartments as they plan to rent them out, or leave them for their children to inherit.

Those over 50 showed the strongest purchasing power, even when it came to large apartments that are bigger than 165 square meters, accounting for over half of the apartments sold.

One Daewoo E&C official said, “Baby boomers in their 50s typically have children who aren’t married and are preparing for life after retirement, so they need a bigger living space.”

“After accumulating a certain amount of wealth, those who are looking to purchase real estate to inhabit themselves usually go for bigger types of apartments, while smaller types are popular for investors,” the official added.

The study also found the distance between an individual’s original address on the nation’s official resident registration system and where the newly purchased apartments are located has grown further in recent years.

In Seoul, the average distance between where people currently live and where they purchase a new apartment is 7.82 kilometers, particularly for smaller apartments as experts predict they are being purchased as investments.

The study was conducted between 2010 and 2016, and was based on a sample of 26,329 households living in apartments in Seoul and the surrounding areas, the findings of which were compared to previous research conducted between 1999 and 2004 in order to highlight recent changes in the housing market.

Hyunsu Yim (hyunsu@koreabizwire.com)