Yi Whan-woo is a Korea Times journalist primarily covering finance. He writes in-depth articles on macroeconomy and financial markets and previously covered sports, politics, diplomacy and inter-Korean affairs, among others. Feel free to contact him at yistory@koreatimes.co.kr.
Financially pressed older adults urged to downsize homes to secure cash
An old customer is grocery shopping at a supermarket in Seoul in this undated photo. Korea Times file
By Yi Whan-woo
Older people should consider downsizing their homes to secure cash, as many do not have stable incomes amid soaring costs of living, according to economists and researchers on Monday.
They cited a report released by the Hana Institute of Finance, which showed that 81.3 percent of Koreans aged 65 or older in 2023 were either living alone or with an additional family member, usually a spouse.
A separate report from the Bank of Korea (BOK) in 2024 showed that 57 percent of those aged 65 or older found their income not sufficient for their needs after retirement.
The BOK report showed the surveyed group was financially strained, with more than 85 percent of their assets tied to their houses and other forms of real estate that cannot be quickly converted to liquid funds.
“Under the circumstances, downsizing a house can be an option for the seniors to secure cash and improve their financial well-being,” said Chung Yoon-young, who authored the Hana report.
“By moving to a smaller or less expensive home, seniors can use the money that is left over after selling the property to pay taxes, insurance, and other living expenses,” Chung said. “Furthermore, they can make investments in stocks, bonds and other easily-cashable assets, which can be a reliable source of income.”
Ha Joon-kyung, a Hanyang University economics professor, voiced a similar view.
“Many seniors are living in a house that is far bigger than they actually need,” the professor said.
His remarks were in line with the Hana report, which in 2023 found that 57.5 percent of older people had lived in the same home for 10 years or longer.
The report indicated that many survey takers had previously lived together with spouses and children before being separated due to death, jobs, marriage or other reasons.
The professor said there should be tax incentives and other financial support to encourage seniors to downsize their homes, adding that 93.4 percent of older homeowners in the report expressed reluctance to move.
“The rate suggests that changing the financial mindset of seniors concerning their property is essential,” Ha said.