People in their 20s and younger who are struggling with debt… Highest mortgage delinquency rate among all age groups

A direct hit from high interest rates… Highest for 2 years
17,000 people under the age of 30 ‘dispose of their homes’

Kim Joong-hyeon (28) purchased an apartment in Gyeonggi-do two years ago using mortgage and credit loans. The loan he took out on a 500 million won house alone amounted to 400 million won. Since it was a Bogeumjari loan, the interest rate was relatively low, but the monthly principal and interest repayment alone is well over 1.5 million won. Mr. Kim said bitterly, “I bought a house with the thought that if I didn’t buy it now, I wouldn’t be able to live in it for the rest of my life, but now I have more moments where I worry about whether I should sell it,” and “I am in a situation where I am paying off my debt by reducing my expenses somehow.”

The worries of the ‘young kkeuls’ (debtors who took out loans with their souls) in their 20s are deepening. This is because they hastily borrowed money from banks to fill the gap in real estate assets and were hit with high interest rates. Mortgage delinquency rates are on the rise across all generations, but the delinquency rate of borrowers in their 20s continues to be higher than that of other generations. According to data received from 19 banks (commercial, regional, and internet-only banks) through the Financial Supervisory Service on the 11th by Rep. Yang Kyung-sook of the Democratic Party of Korea, a member of the Planning and Finance Committee of the National Assembly, the home loan delinquency rate for people in their 20s and younger was 0.39% as of the end of the third quarter of this year. It was counted. This refers to the percentage of principal and interest delinquent for more than one month, which is a sharp increase of 0.15 percentage points compared to the same period last year (0.24%).

This is a high level even compared to the delinquency rate of other generations. As of the end of the third quarter of this year, the delinquency rate for people in their 30s was 0.20%, which is half of that for people in their 20s and younger. Those in their 40s and 60s or older accounted for only 0.23% each. Those in their 50s recorded a slightly higher rate of 0.25%, but it was significantly different from borrowers in their 20s or younger.

The delinquency rate for those in their 20s and younger has surpassed that of other generations and has continued for eight quarters since the end of the third quarter of 2021. At that time, the delinquency rate was 0.14%, which surpassed the delinquency rate of people in their 50s (0.12%) and 60s (0.13%). At the end of the second quarter, it recorded 0.44%, rising to the highest level ever.

Young people who cannot withstand high interest rates end up giving up their homes. According to Statistics Korea’s ‘2022 Home Ownership Statistics’, as of November last year, the number of homeowners under the age of 30 was 274,000, a decrease of 17,000 from the previous year (291,000).

Reporter Min Na-ri