By Choi Sung-jin
With more households being forced to shift from chartered houses to monthly rental homes, their housing costs are snowballing, officials said Monday.
According to Statistics Korea, Korean households’ real housing costs stood at 74,200 won ($60) a month on average last year, up 20.8 percent from 2014. It was the first time since the office began gathering related figures in 2003 that monthly housing costs exceeded 70,000 won and the first time the increase topped 20 percent, officials said.
Housing costs are money spent directly on residence, such as monthly rent and maintenance costs, and does not include the financial costs of those who live in their own homes or chartered homes by paying large deposits but no monthly rents. Accordingly, the average housing cost tends to appear lower than the actual amount if it were to include expenses paid by all households, including home owners and those living in chartered homes, the officials said.
“The sharp increase in the number of people living in homes paying monthly rents has had a great influence on the rise in average housing costs,” an official said.
Meanwhile, it is getting more and more difficult for ordinary wage earners to buy a home.
As of last December, the average transaction price of apartments in Seoul was 551.3 million won, or 154 times the average disposable income of 3.56 million won a month for two-member households or larger, after excluding taxes. This means a family in Seoul has to save all of its income, spending not one cent, for 12.9 years, one year longer than in 2014.
Even saving money to raise deposits for chartered homes has become harder.In 2014, the average deposit amount was equivalent to 7.4 years of after-tax disposable income, but this increased to 8.7 years last year.