20s and 30s Rush to Max Out Loans for Homes Despite Regulations

Since the real estate measures on June 27 of last year, there has been a significant increase in the proportion of people in their 20s and 30s taking out loans close to the maximum limit of 600 million won for mortgage loans in the metropolitan area and regulated regions.

The trend of young people in their 20s and 30s scrambling to secure loans—often referred to as yeong-kkeul, or pulling together every possible resource—appears to be accelerating. This is evidenced by an increase in first-time homebuyers in the relatively expensive Gangnam area, as well as rapid home price hikes in places like Dongtan-gu in Hwaseong, Gyeonggi Province, where many employees of semiconductor companies receiving large performance bonuses reside.

According to data provided by the Financial Supervisory Service to Representative Kim Sang-hoon of the People Power Party, loans in the range of over 400 million won to 600 million won totaled 7.1577 trillion won from January to May of this year.

This is an increase of 610.8 billion won compared to the same period last year.

While loan amounts in other brackets actually decreased, this specific bracket was the only one to see an increase.

This is interpreted as demand concentrating in this bracket as people attempt to borrow the maximum amount allowed following the financial authorities' decision to cap mortgage loans at 600 million won through the June 27 measures last year.

In particular, this so-called full-amount borrowing in the over 400 million won to 600 million won range was prominent among the 20s and 30s age group.

From January to May of this year, these loans reached 3.9356 trillion won, an increase of 921.1 billion won, or a staggering 30.6 percent, compared to the same period last year.

The growth rate of full-amount borrowing among those in their 20s and 30s is more than three times that of all age groups combined.

Analysts suggest that as successive real estate demand suppression measures were introduced, the mentality of "borrow as much as you can while you still can" has strengthened.

There were also signs of attempts to bypass loan regulations by utilizing parental support.

According to data from the Ministry of Land, Infrastructure and Transport, the proportion of funds for home purchases by people in their 20s and 30s derived from gifts or inheritance reached 38.4 percent from January to April of this year, an increase of 3.9 percentage points from last year.

In particular, gifts were notable in the Gangnam area, with 224 people purchasing their first home in Gangnam-gu during the month of May alone.

Corporate loans, which are excluded from the Debt Service Ratio (DSR) regulations, have also surged.

From January to April of this year, the guarantee scale of SGI Seoul Guarantee for private companies reached 602.5 billion won, a 26.3 percent increase compared to the same period the previous year.

Reported by Kim Minjeong | Video by Jang Yu-jin | Graphics by Yang Hye-min | Produced by SBS Digital News
※ Please note: This article was translated by AI and may contain errors.