Lost Seoul: S.Korean middle-class dreams spoiled by soaring house prices

first_imgEven with unemployment spiking as the coronavirus pandemic swept South Korea in February, Baek Seung-min asked his wife to quit her nursing job to help reach a dream they had spent a lifetime chasing: buying their own apartment.The 35-year-old interior designer said giving up his wife’s 58 million won ($48,000) salary would improve their chances of securing a property after the government introduced a host of measures aimed at cooling rampant property prices.The unusual plan was to cut his wife’s income for a while so the couple’s annual earnings were low enough to be eligible for a quota system in new property developments designed to give more low-income newlyweds access to housing. Anger at inequalityWhen the left-leaning Moon took office in 2017, his central promise was to create a level playing field for all South Koreans and a society where hardworking people could raise a family and afford a home.But tighter mortgage rules featuring vastly lower loan-to-value ratios, along with various tax penalties to discourage speculative transactions, are contributing to higher rents and larger down payment requirements – hurting those the policies are intended to help.Mortgage rules for Seoul now cap borrowing at 40% of the value of the home. Pockets of the glitzy suburb of Gangnam are also subject to a transaction permit system, meaning sales without a permit can be made invalid if a purchase is considered “speculative”.Critics say such policies mean the “gold spoon” children of the wealthy can snap up the best homes with their cash, leaving “dirt spoons” trapped as second-class citizens – fuelling the inequality Moon promised to tackle.While some families are cutting their incomes to improve their chances of getting a boost onto the property ladder, others are getting divorced on paper to reduce real estate taxes or not registering their marriage to keep separate home-buying applications, according to two lawyers and a tax accountant Reuters spoke to.Anger at Moon’s economic policies has wiped out a surge in his approval ratings from the handling of the coronavirus pandemic, slipping back to a near nine-month low of 44.5%, according to a Real Meter survey on Thursday.The Presidential Blue House declined to comment for this article.On Tuesday, Finance Minister Hong Nam-ki said stabilizing home prices was the government’s biggest public welfare policy goal as plans were announced to add more than 132,000 new homes in Seoul through 2028.Middle class ticketFor decades following the 1950-53 Korean War, South Koreans saw a degree from a top university and an apartment in Seoul as the fastest way to the middle class, which explains why about three-quarters of household wealth is concentrated in real estate.But now, “dirt spoons” who studied hard and secured white-collar jobs such as lawyers and interior designers say the cooling measures Moon introduced have made it impossible for them to buy a property in Seoul even with a six-figure salary.It now takes an average Korean household more than 14 years of income to buy an average Seoul home, assuming zero expenses. It was 11 years when Moon took office, KB Bank data shows.Hong Na-ri, a lawyer who rents a three-bedder with her twin daughters and husband in Seoul, says her family is priced out of the property market.The price of the flat Hong has been renting in Seoul’s Songpa neighborhood has more than doubled to 1.8 billion won since she moved to the area in 2015.”When I got married [in 2015] I believed prices will go down…now everyone asks me why didn’t buy one when I could. It makes me anxious, but there is nothing I can do,” said the 35-year-old, whose combined household income ranges from $6,700-$10,000 a month.”It’s not like I can move outside of Seoul, away from our babysitter, preschool, and my job.”Moon is trying to fix structural problems in the economy.He has sought to rein in the powerful chaebol conglomerates such as Samsung and Hyundai, which have seen their profits far outstrip household income growth. Tighter mortgage rules were introduced because the easier credit available under his predecessor was blamed for initially stoking the housing bubble.Yun Chang-hyun, a conservative economist and member of parliament for the opposition United Future Party, says the government’s approach is creating more uncertainty about future.”More than 20 separate set of measures without success has caused stress and anxiety among people they must buy something now or never.” Even so, Baek and his wife decided to settle two hours west of his Seoul workplace in Incheon, where borrowing rules were looser and apartments far cheaper.”Seoul home prices grew way out of reach, we had to go all the way to Incheon to buy our place,” Baek said. “The government is crushing our dreams when they curb loans and tell us not to buy homes, it enrages me.”Despite more than 20 cooling policies introduced by President Moon Jae-in’s government, home prices in Seoul have risen more than 50% since 2017, the fastest pace in the world, according to statistics site Numbeo.The surge has dashed the hopes of many young families and signaled that the “middle class contract” that helped build Asia’s fourth-largest economy may have slipped out of reach.center_img Topics :last_img read more

Moody’s Reaffirms Panama Canal’s A2 Long-Term Rating

first_imgThe Panama Canal Authority’s (ACP) A2 long-term rating has been reaffirmed with a stable outlook, according to ratings agency Moody’s.The ACP’s strong financial performance has resulted in better than anticipated financial metrics, driven by the successful operations of the Expanded Panama Canal, the agency explained.Moody’s also noted the canal’s strong operating track record and robust growth after the expansion.“Once again the credit rating agency confirms the great operational and financial strength of the canal and recognizes that the robust institutional structure and governance continue to be key to the success of the Panama Canal Authority,” Francisco J. Miguez, Panama Canal Vice President of Finance, said.The credit rating agency said that the canal has demonstrated resiliency in times of economic downturn, highlighting that “despite macroeconomic factors, such as sluggish economic global performance, tariff disputes, and a low demand for raw materials in Latin America and Asia, that could negatively impact the canal’s operations, Moody’s estimates tonnage to continue increasing during 2019.”In August, Fitch Ratings affirmed the ACP A investment grade rating with a stable outlook for its long-term issuer default rating and its senior unsecured notes. In July, Standard & Poor’s (S&P) Global Ratings improved the canal’s outlook from stable to positive, and also affirmed its A- rating of the waterway.last_img read more

Stone’s squad looking to avenge blowout against Illinois

first_imgMany athletes know that learning from your mistakes will help improve your performance. This Thursday, the women’s basketball team will be hoping to learn from their mistakes that caused them a loss to Illinois early in the season.In that game just over three weeks ago, Illinois jumped out to a 16-point lead midway through the first half and never looked back. Wisconsin ended up suffering its worse loss of the season 84-54, and it all took place at the Badger’s home court at the Kohl Center.Illinois was unstoppable in that game as they finished 57 percent from the field and an astounding 11-of-16 from behind the arc.”Well, we hit a buzz saw when [we met last time],” head coach Lisa Stone said of the game. “They were obviously hot and made a ton of three’s on us. We had trouble getting through staggered screens the last time we played them. But they came in off a disappointing loss and then took it at us, and they’ve not won a game since they played us.”Now that doesn’t mean that they’re not capable,” Stone continued. “They’re having a nice year, and hopefully we can play much better defense on the perimeter.”The Badgers will have to contend once again with 5-foot-8 senior guard Janelle Hughes, who leads the team in scoring at 13.6 points per game. She has come out strong her senior year after coming off the bench all of last year. Hughes had 15 points in the last meeting, and the outside shooting of her and Lori Bjork burned the Badgers.The duo combined to go 9-of-13 from the three-point line, which all but sealed the Badgers fate. “They’ve got a terrific freshman in Bjork and great leadership, a senior point guard and a senior inside that really are leading the charge,” Stone said. Bjork had a career-high 24 points to lead all scorers in that earlier matchup, tallying five of those 11 made three-point shots. Another Illini who had a stellar game last time the two teams met is senior point guard Maggie Acuna, who got a record of her own in that game when she recorded 16 assists. That number was not only a school record but also the high mark for assists in a game ever at the Kohl Center. Now, things look different for the Badgers when they head to Champaign.The once strong Illinois team has been struggling as of late. Illinois started the season hot in conference play at 4-1 but has now lost six straight contests.Illinois now sits at 4-7 in conference but 12-10 overall.In all fairness to Illinois, they faced all the teams in the top half of the Big Ten standings, excluding Iowa, in just the past three weeks. That includes two matchups with last year’s national runner-up, Michigan State. And the Illini, whose last five games are to teams ranked lower than them in conference, can possibly finish .500 in conference play if they can defeat the Badgers.For the Badgers getting out to a strong start will be key to victory, as they were never able to catch up after falling behind so far in the last game.”If we’re not hitting and we’re hurrying all the time, we’re going to be playing from behind the whole game,” Stone said. “That’s the type of mentality that we have to have, because that’s the way you’re going to win games.”The only Badger to get into double figures in the last game was Jolene Anderson, who had the team high with 16 points. The team as a whole shot just 37 percent, but the return of Janese Banks to the starting lineup should bolster the offense.Banks, the team’s second leading scorer, came back slowly, coming off the bench originally. Since then, she has gotten to start again and she has produced in a big way.The sophomore guard has combined for 29 points, 10 rebounds and 10 assists in just the last two contests.Wisconsin will definitely need her to help not only on offense but to contain the outside shooting if they have any hope to come away with a win. The last time Wisconsin defeated Illinois was two years ago on their home court, and they hope to accomplish that feat again Thursday at Assembly Hall in Champaign.last_img read more

Beach volleyball’s 16-game home win streak comes to end

first_imgIn an epic home opener at Merle Norman Stadium against a pair of beach volleyball powerhouses —Pepperdine and UCLA — the Trojans fell on the wrong side of both nail-biting matches 3-2. Freshman Haley Hallgren (above) won both of her matches with her teammate freshman Sammy Slater. Sunny Dong | Daily TrojanThe clash between three of the nation’s top programs was one to remember, as the Trojans fought hard but came just short. Both matches came down to third sets in the teams’ final matchups with both teams anxiously watching their final duos play. Unfortunately for the Trojans, both matches ended in losses leading to the end of their 16-game winning streak.Against UCLA, the Trojans split the fourth and fifth courts. On the fourth court, USC seniors Jo Kremer and Jenna Belton defeated UCLA freshman Mac May and sophomore Savvy Simo 21-12 and 21-15. The fifth court saw UCLA junior Izzy Carey and freshman Megan Muret defeat USC freshman Maja Kaiser and graduate student Alexandra Poletto 21-12 and 21-12.On the second court, USC sophomore Joy Dennis and junior Brianna Sizemore dropped their match 21-11 and 21-18, while freshmen Haley Hallgren and Sammy Slater won their match 21-19 and 21-18, setting up a showdown of both team’s No. 1s to decide the dual. In the deciding match, UCLA juniors Megan and Nicole McNamara downed senior Terese Cannon and junior Abril Bustamante 21-17 and 21-18 to lock down the victory for the visiting Bruins. Against the Pepperdine Waves, the Trojans started off strong with the fifth court team of Kaiser and Poletto defeating juniors Nikki Lyons and Kaity Bailey 21-19 and 21-16. However, soon after, the Trojans were put on the ropes. On the fourth court, Pepperdine’s junior Skylar Caputo and freshman Alexis Filippone defeated Belton and Kremer 19-21, 25-23, 15-12 and the first court match saw freshman Brook Bauer and junior Madalyn Roh defeat Cannon and Bustamante 21-19 and 21-18. After the third court duo of Hallgren and Slater were able to overcome the Waves in three thrilling sets (21-14, 16-21 and 17-15) and keep USC’s hopes alive, both squads turned their attentions to court two where Dennis and Sizemore were locked in a tight battle against Pepperdine senior Corinne Quigle and sophomore Deahna Kraft. After splitting two thrilling sets (21-18, 19-21), Sizemore and Dennis eventually dropped the third 15-13 and the Waves’ celebration began.After two tough losses, head coach Anna Collier said that today can be used as a learning experience“We learned a lot,” Collier said. “If we don’t learn from this and grow, this was all for nothing. You’ll learn more from losing than you ever will from winning.”Collier also said that while the passing of the team left something to be desired in her eyes, she said she was happy with how the team adjusted to their new roles and that one or two plays could have changed the result. “We have to pass better,” she said. “I think if we can do that better, we’ll be fine. I don’t think they did anything that was that special, we just have to finish better.”Despite the losses, Collier praised the team’s tenacity and their willingness to adjust to a new year. “We’re all playing different positions because we have new, young team,” she said. “That’s difficult to do and I thought they embraced that.”The Trojans will look to bounce back in Malibu on Saturday where they will take on both Pepperdine and UCLA again in the Zuma Classic.last_img read more