Korean Job Discussion Forums

[basic69isokay]

So almost all Koreans and foreigners alike know that housing prices here are due for a massive correction downwards, but when will it happen? The only part of the country that might see continued increases in value would be Jeju, because of the Chinese taking over and investing there.
But other than that, my guess is maybe 2018? A sharp decrease wouldn't surprise me, even 50-70%.
Anyone who recently bought? How do you feel?

[Cave Dweller]

People keep telling me that I should never buy a villa here, as they don't appreciate. Apartments can only go up so high. The population isn't growing here but they keep building more of them.

If I were buying, a villa it would be. If I could get back 90-100% of what I paid, it's a good investment. If housing prices tank, I don't think villas will go down a lot.

[Stan Rogers]

I bought and I'm happy with my purchase.

All I can say is location, location, location.

And Jeju is a good location.

[Lazio]

It largely depends on the location.

I bought a villa almost a year ago. We were able to get it for little under market price and also the prices went up a bit in the neighborhood since. So all in all, if I were to sell it now I could get 10% more than what I paid. If I took the time to sell it, maybe even 15%. A similar sized brand new villa in my neighborhood would be 30-35% more than what I paid for mine. That is a good indicator. My place is 7 years old btw.
There are a lot of huge developments planned within walking distance for the next couple of years so I think at the very least it won’t go down.
But in the end; I didn’t buy this place to get rich on it. Just needed some stability, a place to live and wanted to get out of the jeonse boat.

[Stan Rogers]

BTW Jeju was doing just fine before the Chinese showed up. They just made it even better.

[FDNY]

I don't think it will pop at all. Prices will not come down, they will also
continue to rise in select locations.

However, if you don't live in Gangnam or Jeju, then don't waste your
money in real estate.

Put in enough key money so you don't pay rent. This could be upwards
of 100,000,000KRW depending on size or location. Then put the rest of
your money into several diversified mutual funds. Don't look at it or touch
it for 7-10 years. When you withdraw it it will at least double.

[radcon]

[Cave Dweller]

If you have 100 million in a 전세 property that's worth 150-200k, it's cool when you don't get it back. You get to put a lein on the property. It'll be sold at an auction and you'll get your money back.

[radcon]

[Lazio]

[Jimskins]

Jeju might be one of the only place still viable for investment property. I have a friend in the suburbs of Daegu who reckons his new apartment has gone up around 10% since he bought it last year (although I've yet to see any proof).

Gangnam!? That's the worst bubble of the lot. My parents-in-laws' place in Gangnam was worth 23억 at its peak. They tried to sell it for 3 years, eventually lowering it to 16억 last year, still no takers so they gave up and rented it for Jonsei.

In the UK people have been waiting for the bubble to pop for the best part of 20 years, but due to sluggish construction and a half decent birth rate (just under 2), amongst other minor factors, it hasn't happened. In Korea you've got one of the world's lowest birthrates combined with an unrestrained 15 years and counting construction splurge. Simple maths will work this one out.

If your sick of jonsei,want some stability for your kids and are not shelling out a fortune, by all means buy. But buying property on mainland Korea, especially in Seoul, as an 'investment' , is madness.

[Jimskins]

I should add that that prices are also flatlining at best ( KBS intermittently reporting a 'huge rebound' because prices in some part of Gangnam have risen 0.2% -whoopee) against a background of a government throwing everything it can at the market to keep prices up.

As the previous government (same party) encouraged everyone to invest and go into debt as prices would go up' forever' it has no choice but to keep adding more gas to the bubble and pray they aren't the one flying the plane when the wings fall off.

The question as always is not if but when.

[Stan Rogers]

I bought because I was sick and tired of moving.

I need a place to live in so I have no intention of selling whatever the price is.

[PRagic]

Real estate prices have decreased in 6 of the past 7 years. Recent government policies (Choinomics) induced a temporary surge in sales, especially in the capital area, largely on the back of screamingly high chunsae rates and pent up demand.

A lot of low priced sales are kept under the radar by the seller, buyer and agent, but the word has quietly gotten out that some prices in some apt complexes have fallen by as much as 40%.

But in my book, 40% off of too much is still, well! too much!

[Lucas]

The whole system will collapse in the not too distant future.

Jeonsae loans, rely on high interest rates to make the owner money. The interest rate is now - what 2%?

It's only going to go one direction too, with the whole Japan situation.

So owners will increase the loans even more to near 100% of the property value.

Most areas of Korea have an oversupply of new apt's, Koreans love to buy NEW NEW NEW - a 10 year old apt is old, a 15 year old apt is 'ancient'