A Midsummer Night's Grumble, 2013
On a summer night in the middle of a heat wave, members of the women's association of an apartment building are sitting around a table outside and chatting. At first, cookies, fruit, and drinks are laid out. Soon instant cup noodles appear. It will not be a short session.
"The government seemed pretty determined on April 1st. But, even their measure to boost apartment prices isn't doing anything. They are saying it looked like the prices were budging a little, and the market was becoming more active. But pretty soon everything sank back to before."
"You're right. I guess what people are saying is right; apartments aren't going to be good investments anymore."
"What am I going to do? I made my children drop two after-school classes because I have to make the interest repayment..."
"Selling at a bargain price now is not an option. We can only sit back and hope that the prices will go up again."
There is more grumbling. Someone continues.
"Forget it. There's no hope any more. The prices for jeonse are skyrocketing but no one's buying or selling. It's because buyers are sending a clear message that they will wait until prices drop more."1
"I think we have done all we can. All members of the association agreed not to sell the apartments below a certain price. We've even chased the real estate agent out from the neighborhood who opposed us and tried to make deals at lower prices."
"I remember. I still clearly remember all the criticism in the media. Everything went down the drain."
Another woman who had been quiet says, "Well, whatever they say, an apartment is an apartment. We have to hold on no matter what and not sell at low prices for whatever reason. I'm sure one day that will do us good for sure. In a country like this, the amount of land is so limited and there are so many people. How can apartment prices not go up? It's those who are getting out and selling at bargain prices that are public enemies."
"Who would've wanted to sell for less? They were probably stuck in a tight situation."
"Who's right and who's wrong here? Has it not been, indeed, the well-chosen investment in apartments in the right areas that have yielded a profit many times over the annual salary of any decent employment?”
For about the last 40 years, apartments have been considered a sure cash cow in multiplying assets, the so-called wealth effect in economics. With the prices of apartments skyrocketing, the size of ordinary people's spending grew. "Let me put that on my credit card. I can pay back the loan all at once when I sell my apartment later."
The discontent with the relative deprivation on the renters’ side grew even deeper. At long last, they also opened their wallets. It was a spending out of despair.
The national economy was going fine. A national spending spree. Not only the haves, but also the have-nots, all stepped forward as agents of consumption. The warning from a minority, that this kind of "spending on the brink" can jeopardize the future of the country, was buried in silence. Even after the terrible experience of the 1997 Asian financial crisis, we remained ambivalent.