South Korea’s housing crunch offers a warning for other countries

“Buying the house in 2021 might be one of the biggest regrets of my life,” says Kim Myung-soo, a 33-year-old whose home in Jamsil, eastern Seoul, has fallen in value by about $400,000. His wife is 33 weeks pregnant and Mr Kim does not know how he will repay the mortgage. He had planned to wait for prices to rise before selling the property to pay off the loan.

Mr Kim is not alone in his worries. Across the rich world, property markets look precarious. Few are in as bad shape as South Korea’s. House prices fell by 2% in December alone, the biggest monthly drop since official figures began in 2003. The slump has been particularly brutal for apartments in Seoul: prices are down by 24% since their peak in October 2021.