Some retirees find life in the country has perks

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Some retirees find life in the country has perks

It was two years after he retired that Mr. Han, 57, concluded that he should move out of Seoul. There were no signs of an imminent rebound in the real estate market and the costs associated with living in Korea’s capital city didn’t seem to be worth it anymore.

Those factors prompted him to sell his apartment house early last year and move out of the affluent Bangbae neighborhood in Gangnam District, southern Seoul.

Han sold his 84-square-meter apartment unit for 950 million won ($880,150), almost double the average in Seoul at 490 million won.

With enough cash in his pocket, he bought a similarly sized apartment unit in Yongin, about a 30-minute drive from Seoul, for less than half the price of his previous home at 495 million won.

With the surplus, he used 300 million won to pay off his mortgage and spent 100 million won to help finance his son’s wedding, a customary practice among Korean parents.

He now has 100 million won left over, which he said will be spent on his retirement.

Had Han not moved out of the upscale Gangnam area, however, choosing to settle a relatively underdeveloped satellite city, it is highly unlikely he would have been able to so easily handle those affairs.

“It takes less than half an hour to reach my son’s house in Gangnam District from my house in Yongin if I take the Seoul-Yongin Expressway,” he said, adding that he appreciated living outside Seoul for the lower costs and the natural surroundings.

Han’s case is not unique among retirees or those who are about to retire in coming years.

As more in the baby boomer generation who were born between 1955 and 1963 retire, an increasing number of people in their 50s are on the lookout for alternative living outside the capital, a city with a population of more than 10 million that is known for its high costs and heavy traffic.

“Now people have to map out a 30-year retirement plan, which means that the demand for lower expenses and environmentally friendly surroundings on the outskirts will increase among the silver-haired generation,” said Hong Seok-min, the director of the real estate market team at Woori Bank.

Another factor driving many retirees to consider settling out of the city is the sagging real estate market in Seoul. According to Kookmin Bank, housing prices in the city have dropped by 4.19 percent on average over the past five years, which hasn’t provided much incentive for retirees to stay here. That’s led many to consider selling their houses to buy property in outlying areas like Yongin in Gyeonggi.

The situation couldn’t be more different than the past, when retirees held onto their houses in the hope that value of their city apartment units would rise dramatically. Owning an apartment in Seoul was considered a golden ticket during the economic boom in the 1970s and ’80s.

“There are fewer incentives for those in their 50s to keep paying their mortgages in Seoul at a time when the prospects for a robust real estate market are slim to none,” said Kim Tae-sup, a researcher at the Korea Housing Institute.

People used to keep their houses as long as they could so that they could sell them at much higher prices than what they had paid years later and pass on the extra in their children’s inheritance, Kim continued, though that era is long gone.

But despite the positives associated with living outside the city, experts say retirees should try to live in the countryside for at least one year to see if they could adapt to the change in pace.

“This is a 30-year plan you’re talking about here. You should not rush to make a decision over where you are going to spend your last 30 years, and instead explore all the options available in all parts of the country,” said Park Sang-un, who heads U&R Consulting, which specializes in real estate.

One 55-year-old retiree told the JoongAng Ilbo that he wrapped up his life in Hongcheon, Gangwon, two years after he moved there with his wife.

“I had no friends there and no one to talk to besides my wife,” he said. “It took over an hour just to drive to the movies. We decided to move because we felt like we were living in a prison.” 

BY SPECIAL REPORTING TEAM [jkkang2@joongang.co.kr]


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