JTYK should be utilized to boost senior citizens' consumption
- Date 2015-06-23
- Views 657
JTYK should be utilized to boost senior citizens' consumption
- More diverse home loans necessary to improve the structure of the housing finance market -
- Fixed-rate mortgages for low- and middle-income households need to be expanded to enhance market stability -
- HF, Korea Housing Welfare Forum, and the Korean Association for Housing Policy Studies hold a joint housing policy seminar -
The claim was recently raised that the JooTaekYeonKeum (JTYK) reverse mortgage loan program should be more
widely utilized in order to stave off a long recession caused by a slow down in consumption by the elderly.
It has also been pointed out that the qualitative structure of the housing finance market should be improved
and that various mortgage products should be developed.
On the 23rd, Korea Housing Finance Corporation (HF, CEO Kim Jae-Chun) held a joint seminar with Korea Housing
Welfare Forum (Chairman Hong Cheol) and the Korean Association for Housing Policy Studies (President Chung
Eui-Chul) under the theme of ‘The role and future task of housing finance for housing welfare’at its headquarters
in the Busan International Finance Center, announcing the below statement:
JTYK boosts consumption for seniors
- JTYK, which offers a stable income stream, should be utilized to boost their consumption
At the joint seminar, HF Research Fellow Koh Je-Hun gave a presentation entitled ‘The impact of JTYK subscription
on stimulating consumption for seniors,’and claimed, "It has been found that senior citizens who have joined the JTYK
program regard the monthly JTYK disbursements as a stable source of income and therefore tend to show a high level
of consumption. In this context, JTYK should be proactively utilized to boost their buying power.”He also added,
“JTYK will be a viable solution as a slow down in domestic consumption due to seniors' weak purchasing behavior
can become one of the causes of a long recession.”
The need to maintain the stability of the housing finance market and improve the qualitative structure
of household debt
- Mortgage products to be more diversified to cover residential, commercial, and lease-to-own properties
In his presentation entitled ‘A comprehensive approach to the housing finance market and future tasks,’ Korea
Research Institute for Human Settlements Research Fellow Park Chun-Gyu stressed the need to ▲ maintain
the market's soundness; ▲ expand its coverage and enhance the efficiency of housing finance; and ▲ take
a comprehensive analytical approach to consumer protection in order to establish the housing finance support
system. In particular, he explained, “To maintain the stability of the market and improve the qualitative structure
of housing debt, mortgage products need to be more diversified to cover residential, commercial, and lease-to-own
properties.”He added, “There is a need to provide asset securitization and other methods of income generation,
targeting specific groups like newly weds and recent college graduates who have difficulty building wealth
and retirees who have income restrictions.”
Fixed-rate, fully-amortizing loans with level payments need to be offered more widely
- The nation's mortgage system needs improvement to reflect the characteristics of financial consumption
by low- and middle-income families
In her presentation jointly prepared by Professor Lee Yong-Man at Hansung University and Professor Noh
Seung-Han at Konkuk University entitled ‘The role and future task of housing finance to provide housing support
for low- and middle-income households,’ Kim Duk-Rye, a research fellow at Korea Housing Institute, stated, “It is
necessary to make fixed-rate, fully-amortizing loans more widely available, especially for low- and middle-income
households with less financial capacity, and to bolster the housing stability and repayment capacity of those
lower-income families by introducing a limited-liability loan (non-recourse loan).”
She also emphasized that in order to strengthen the role of housing finance offered for low- and middle-income
families, it is necessary to ▲ set the definition of low- and middle-income families, ▲ develop and make available
home equity loans*, and ▲ improve the nation's mortgage system to reflect the characteristics of financial
consumption by low- and middle-income families.
* Equity loan: a loan taken out against home equity in the form of equity investment in which the lending
institution and the borrower share investment risks and returns
These presentations were followed by a discussion moderated by KDI School of Public Policy and Management
Professor Cho Man. The discussion was joined by KDI Researcher Song In-Ho, Land & Housing Institute senior
researcher Lee Jong-Kwon, Korea Institute of Finance Senior Researcher Lee Jae-Yeon, Herald Business Daily Senior
Reporter Jang Yong-Dong, Hanyang Cyber University Professor Ji Gyu-Hyeon, and HF Housing Credit Guarantee
Department Leader Seo Young-Dae.
An HF official described the seminar as follows, "It was a meaningful occasion in which public housing finance agencies
and academic researchers shared their thoughts for improved housing welfare. The opinions and suggestions made
during the discussion will significantly help the improvement of the nation's housing welfare.”