Economics at your fingertips  

The Global Financial Crisis and transition out of homeownership in Korea

Kyung-Hwan Kim and Seung Dong You

Journal of Housing Economics, 2021, vol. 54, issue C

Abstract: We investigate the impact of the 2008-2009 Global Financial Crisis (GFC) on housing tenure transitions in Korea, focusing on the determinants of pathways out of homeownership. Using Korean Labor and Income Panel Study (KLIPS) data covering the period 1999-2016, we analyze tenure transitions made by owner occupiers on the cusp of homeownership. The Korean case is interesting because an asset-based rental lease type, known as chonsei, and monthly rental leases with varying amounts of deposit, comprise the vast majority of private rental options. Western-style monthly rental leases account for a very small market share. Paying close attention to the availability of these private rental contract types, we investigate tenure transition by homeowners exposed to competing risks in the aftermath of the GFC. Estimates from the Cox single-hazard model suggest that, other things being equal, the hazard of homeowners’ transiting to a rental lease during the crisis years is 32% larger than during the non-crisis period. We also find that the effects of the crisis on transitions out of ownership depend on the types of private rental arrangements available to homeowners. Finally, about 50% of the ex-homeowners are still renters by the end of the 4th year, falling to 30% by the end of the 10th year after exiting from homeownership.

Keywords: Housing tenure transition; Single hazard model; Cause specific hazard morel; Global Financial Crisis (search for similar items in EconPapers)
Date: 2021
References: View references in EconPapers View complete reference list from CitEc
Citations: Track citations by RSS feed

Downloads: (external link)
Full text for ScienceDirect subscribers only

Related works:
This item may be available elsewhere in EconPapers: Search for items with the same title.

Export reference: BibTeX RIS (EndNote, ProCite, RefMan) HTML/Text

Persistent link:

DOI: 10.1016/j.jhe.2021.101803

Access Statistics for this article

Journal of Housing Economics is currently edited by H. O. Pollakowski

More articles in Journal of Housing Economics from Elsevier
Bibliographic data for series maintained by Catherine Liu ().

Page updated 2022-03-12
Handle: RePEc:eee:jhouse:v:54:y:2021:i:c:s1051137721000589