As stock prices and home prices rise at the same time, the 2030 generation's FOMO (fear of missing out) is appearing in both the stock and housing markets. Some are investing even the money set aside to buy a home into high-risk stock products, while in the housing market, more people in their 20s and 30s are making their first-ever purchases, saying they will buy a home before it is too late. Anxiety about falling behind alone in asset price gains is spurring both investing and homebuying.
A office worker in his 30s, identified as A, who is about to get married, signed a contract early this year to buy an apartment in Gwanak District, Seoul, adding a loan to the 400 million won saved with his fiancée. But as the stock market's "bull frenzy" continued ahead of the interim payment, he put all the cash except the down payment into a leveraged exchange-traded fund (ETF) that doubles the daily return of a single semiconductor stock. The idea was to add stock revenue to further increase funds to buy a home.
The investment made revenue at first, but as the stock market plunged, he lost a significant portion of the principal. A said, "Even with a side job, it is nowhere near enough to quickly make up the loss," and "I think about quitting countless times a day, wondering if I should take my severance pay and invest again."
In June, when stock market volatility increased, forced sell-offs surged. According to the Korea Financial Investment Association on the 25th, the amount of forced sell-offs relative to credit balances in June was 1.1228 trillion won, up 58.7% from 707.6 billion won in May. It was the first time this year that monthly forced sell-offs exceeded 1 trillion won. A forced sell-off occurs when an investor fails to repay a credit balance by the settlement date and the securities firm forcibly disposes of the stocks held.
Some are torn between putting money into stocks or dwellings. B, a office worker in his 30s working in Yeouido, suggested in June that they buy an 800 million won-range apartment in Nowon District as a newlywed home, but the fiancé proposed growing funds further with stocks. B said, "The asking price for sale of an apartment with the same area as the one we viewed then has recently exceeded 1 billion won," and "I am attending real estate investment seminars because it seems it will be hard to buy a home in Seoul if not now."
At the time forced sell-offs increased in the stock market, first-ever purchases by people in their 20s and 30s rose in the housing market. In both markets, anxiety about falling behind in asset gains appeared. ZIGBANG CO.'s analysis of Supreme Court Registry Plaza data showed that in July, first-ever purchases of collective buildings in Seoul totaled 7,547, the most since November 2021. That was up 4.7% from the previous month. Purchases by people in their 30s rose from 3,979 to 4,300, and those in their 20s increased from 765 to 887. The share of buyers in their 20s and 30s among all buyers was 68.8%.
Apartment price increases stood out outside the three Gangnam districts (Gangnam, Seocho and Songpa). According to KB Real Estate, as of the survey on the 10th, the average apartment sale price in Seoul was 1.60739 billion won, surpassing 1.6 billion won for the first time. Jungnang District (2.25%), Seongbuk District (2.08%), Nowon District (1.95%), Jongno District (1.94%) and Gangseo District (1.86%) outpaced the Seoul average.
The industry views the 2030 generation's moves in the two markets as different outcomes of anxiety about falling behind rising asset prices. In the stock market, it has appeared as high-risk investments expecting high returns in a short period, and in the housing market, as an increase in first-ever purchases from those trying to buy a home before it is too late.
A source in the financial investment industry said, "Young people jumped into the stock market trusting the government's will to support it, but they were exposed as-is to sharp volatility and high-risk leveraged products," and "Anxiety about falling behind whether choosing stocks or real estate is amplifying a sense of relative deprivation."