Student Loans and Housing Behaviors: Evidence from South Korea

This study seeks to explore the complex connection between student loans and housing tendencies among the millennial population in South Korea. I utilized the Youth Panel data set spanning from 2014 to 2021, which was made available by the Korea Employment Information Service, along with a Cox proportional hazard model. The results of this study are as follows. While student loans did not appear to strongly hinder the move to homeownership, they notably influenced the preference for renting as a housing option, particularly during millennials’ relocations. More specifically, older millennials born between 1978 and 1986, or those with an associate degree or higher, may be more inclined toward renting, moving out of their parents’ homes, and pursuing a self-sufficient lifestyle. Understanding the complex relationship between student loans and housing behaviors is crucial, especially vis-à-vis housing policies aimed at increasing homeownership rates among young adults in South Korea. My findings provide evidence to support this effort.