Young Koreans pull out of housing subscription savings accounts

• Published date: 27 February 2023
• Publication title: The Korea Times

Young people in Korea are either closing down or opting not to open a housing subscription savings account as the real estate market here continues to remain in the doldrums. Falling home prices and a low annual deposit interest rate are also cited as the reasons behind this trend.

A housing subscription savings account?enables an adult to become eligible to purchase a state-subsidized or private apartment after a raffle after making deposits for a given period. It has been considered as a must for those who wish to buy their own house.

"The account is kind of a white elephant for me. I'm holding it because I have poured a lot of money into it for about five years, but I feel very uncertain whether I can buy my house with that in the future," an office worker who asked to be identified only by her surname Jeong told The Korea Times.

"I watched some YouTube videos that recommended transferring the money to an installment savings account that guarantees more profits now. I'm seriously considering closing down the account," the 27-year-old said.

But according to data the Ministry of Land, Infrastructure and Transport submitted to Rep. Yang Kyung-sook of the main opposition Democratic Party, the number of people who hold the account stood at 27.74 million as of January, down by 860,000 from last June. The figure has constantly decreased for seven months. During November alone, 519,000 people closed their existing housing subscription savings accounts.

The total amount of deposits in the accounts also continued to fall. The total deposit as of January...