2014, Vol.24, No.2

Korea Real Estate Review 2023 KCI Impact Factor : 0.56

pISSN : 2092-5395 / eISSN : 2733-8339
https://journal.kci.go.kr/krer

Recently, there has been a growing interest in the valuation of contaminated properties and discussion of the promotion for soil environment assessments in real estate transactions. However, there has been little research about adaptation of contaminated land valuation in Korea. The purpose of this study is to review contaminated land valuation approaches and standards in other countries to be applied in Korea. As a result, this study proposes that preconditions need to be met in order for us to set up the requirements of contaminated land valuation. First, it will be required to develop standard calculation of clean-up costs. Second, this study makes a proposition that real estate appraisers need to cooperate with environmental pollution experts. Finally it will be required to improve the legal system related to soil environment assessment and real estate valuation.

We analysed the impact of demographic changes, such as the sharp increase of aged population and the sooner retirement of baby boomers to housing market, by using panel data of Seoul and six metropolitan cities in Korea from 2003 to 2012. We used several variables related demographic, socio-economic, and housing supply changes we found that some of the demographic and socioeconomic variables are statistically significant effects on the housing price changes, but all of the housing supply variables are not statistically significant. One important result is that the 1% increase of old dependency rate is associated with a decline of 0.12% in house prices. Anticipating the consequences of an aging baby boom generation should prepare planners to manage the supply of new construction to meet future housing needs and help the ageing baby boomers to stay in the cities.

As Korean baby boomers started to retire, the age cohort’s retirement is expected to have extensive impacts on both housing and wealth markets. With transforming socioeconomic fabric and changing asset allocation, this research is to assess wealth effects of home-owning baby-boomers on consumer spending. Using the Korean Labor and Income Panel Study, this study identifies 970 households nationwide and seeks to their housing wealth effects on non-durable consumption by age, housing structure type, and debt ratio. The results show that the baby-boomers have high aggregate wealth with high amount of debt, and their consumption elasticity is affected by aggregate wealth value, financial asset, housing property, non-residential property, net wealth and capital gains. Housing wealth effects on the consumption are as equal as those of financial assets, but are twice as high as those of non-residential property. Also, it’s found that the baby-boomers tend to reduce the debt ratio and to raise liquidity in order to afford an adequate standard of living since personal consumption expenditure rises, retirement declines income and alternative income sources are insufficient. The research implies that personal consumption of baby-boomers can’t be simply met by home equity extraction and realized capital gains on housing, so that housing wealth effects won’t produce much impacts on long-run consumption, particularly in times of economic slowdown.