Japan Went Through It First… The Next Crisis Facing South Korea's Hous…
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작성일2026-06-30 07:45:09
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Japan Went Through It First… The Next Crisis Facing South Korea's Housing Market
Hello, viewers. This is World Current Affairs Economy.
There was once a common belief in the real estate market:
The bigger the house, the better.
Large apartments always rise the most in value.
But that formula is beginning to break down.
This year, the best-performing apartments in Seoul were not large luxury units but smaller apartments ranging from 40 to 60 square meters. In the first half of the year, small apartments in Seoul rose by 6.72%, while apartments larger than 135 square meters gained only 2.09%.
Why is this happening?
The answer may lie in Japan.
Japan experienced population aging, low birth rates, and a rapid increase in single-person households long before South Korea did. As a result, large homes in regional areas became vacant, while smaller homes in major cities such as Tokyo continued to attract demand. Japan now has more than nine million vacant homes, accounting for approximately 14 percent of its housing stock.
South Korea now appears to be standing at a similar crossroads.
People are marrying later, having fewer children, and the number of one- and two-person households continues to grow. At the same time, stricter lending regulations and high interest rates are making large homes increasingly unaffordable.
As a result, many young buyers are shifting toward smaller, more affordable apartments.
The story, however, does not end there.
Seoul is unlikely to experience the same rapid decline seen in many regional areas of Japan. Housing supply remains limited, and jobs, education, and transportation infrastructure are heavily concentrated in the capital region. The Seoul metropolitan area remains the center of housing demand in South Korea.
Regional cities, however, face a different reality.
If populations continue to decline, jobs disappear, and younger generations move away, large apartments and aging homes outside the capital could increasingly face the same challenges that Japan is experiencing today.
Ultimately, South Korea's housing market is unlikely to move in one direction.
Prime areas of Seoul may become even more expensive.
Small apartments could continue to outperform.
Meanwhile, large homes in regional areas may become increasingly vulnerable.
The lesson from Japan is clear:
Real estate no longer rises simply because it is bigger.
In the years ahead, the winners in the housing market are likely to be places with people, jobs, and strong end-user demand.
Key Message
Japan experienced this real estate future first. South Korea may already be entering the same era.
#JapanRealEstate #KoreaRealEstate #SeoulApartments #SmallApartments #PopulationDecline #AgingSociety #HousingMarket #WorldCurrentAffairsEconomy
Hello, viewers. This is World Current Affairs Economy.
There was once a common belief in the real estate market:
The bigger the house, the better.
Large apartments always rise the most in value.
But that formula is beginning to break down.
This year, the best-performing apartments in Seoul were not large luxury units but smaller apartments ranging from 40 to 60 square meters. In the first half of the year, small apartments in Seoul rose by 6.72%, while apartments larger than 135 square meters gained only 2.09%.
Why is this happening?
The answer may lie in Japan.
Japan experienced population aging, low birth rates, and a rapid increase in single-person households long before South Korea did. As a result, large homes in regional areas became vacant, while smaller homes in major cities such as Tokyo continued to attract demand. Japan now has more than nine million vacant homes, accounting for approximately 14 percent of its housing stock.
South Korea now appears to be standing at a similar crossroads.
People are marrying later, having fewer children, and the number of one- and two-person households continues to grow. At the same time, stricter lending regulations and high interest rates are making large homes increasingly unaffordable.
As a result, many young buyers are shifting toward smaller, more affordable apartments.
The story, however, does not end there.
Seoul is unlikely to experience the same rapid decline seen in many regional areas of Japan. Housing supply remains limited, and jobs, education, and transportation infrastructure are heavily concentrated in the capital region. The Seoul metropolitan area remains the center of housing demand in South Korea.
Regional cities, however, face a different reality.
If populations continue to decline, jobs disappear, and younger generations move away, large apartments and aging homes outside the capital could increasingly face the same challenges that Japan is experiencing today.
Ultimately, South Korea's housing market is unlikely to move in one direction.
Prime areas of Seoul may become even more expensive.
Small apartments could continue to outperform.
Meanwhile, large homes in regional areas may become increasingly vulnerable.
The lesson from Japan is clear:
Real estate no longer rises simply because it is bigger.
In the years ahead, the winners in the housing market are likely to be places with people, jobs, and strong end-user demand.
Key Message
Japan experienced this real estate future first. South Korea may already be entering the same era.
#JapanRealEstate #KoreaRealEstate #SeoulApartments #SmallApartments #PopulationDecline #AgingSociety #HousingMarket #WorldCurrentAffairsEconomy
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