Why are univ. grads continuing to live in college towns?

A freshman from Wonju, Gangwon Province moved to Seoul to attend a four-year college in 1997. He rented a room in a private boardinghouse that was a five-minute walk from his school.

Rent was just 180,000 won (163 U.S. dollars) per month for the small room, and he also had to share the bathroom with others. But none of this disappointed him because of his dream that he would rent a small house and have his own family in Seoul within a decade.

After 15 years, the man, now 34, still lives in a college town. One difference since 1997 is that he moved to another college town to be close to his office. After living 10 years near his college, he moved to another college town three years ago to cut his commuting distance. The security deposit was 10 million won (9,000 dollars) and rent 500,000 won (453 dollars) per month.

The reason he could not move out of the college town was money. He works for a small public relations company and his annual salary is just 25 million won (22,700 dollars). Because of this income, he cannot afford a studio in downtown Seoul, which would cost at least 700,000 (635 dollars) to 800,000 won (725 dollars) in monthly rent. Though he wants to save monthly rent by renting a house on "jeonse," or a lump sump loan to the landlord that he would receive when moving out, he lacks that kind of money.

After subtracting living expenses, rent and utilities and giving a small amount to his parents, he has nothing left over to save. “Most of my friends who are single live in college towns like me...I think no college graduate can leave a college town without parental support,” he said.

○ College town “old boys”

A larger number of college graduates looking for work or who have jobs are staying in college towns. They rent small studio apartments there because the relatively lower rent and cost of living make it easier for them to deal with the ever-rising prices and rent in Seoul.

A landlady, 50, who rents out studios near Korea University in northern Seoul said, “I have many tenants who graduated from college as college students... A college graduate got a job in (Seoul`s southern district) of Gangnam, but decided to stay here because the rent is cheaper.”

Rent for studios in downtown Seoul is too expensive for new employees just starting out. According to real estate information agency Real Estate 114, a studio covering 27 square meters at Doosan We’ve Centium Officetel in Gangnam costs 830,000 won (752 dollars) per month and a security deposit of 10 million won (9,000 dollars).

Another studio with the same size in the same area cost 750,000 won (680 dollars) per month with the same deposit. Finding more expensive units is also easy.

The price of jeonse housing has also shot up. Over the past two years, the number of jeonse units lower than 100 million won (907,000 dollars) fell 41 percent from 900,596 to 533,792.

In college towns, however, people can rent studios for 400,000 (363 dollars) to 500,000 (453 dollars) per month with a security deposit of 10 million won (9,000 dollars).

Even more money can be saved if a renter is willing to live in a half-basement unit, which can have rent as low as 350,000 won (317 dollars).

A 31-year-old man who graduated from Korea University in February 2010 still lives in his college town and studies at the university library. For two years after graduation, he spent to pass the higher civil service exam, but after failing the test two years in a row, he decided to get a job. Leaving the college town seems quite difficult for him for the time being.

○ Old not making way for the new

As more graduates decide to stay in college towns, college students are experiencing more difficulty getting their own homes. Whenever a new semester approaches, many students worry about fighting another war to secure rooms.

Hyun Taek-soo, a sociology professor at Korea University, said, “This isn`t an isolated case in Korea. It’s a common problem in many other countries. Without a drastic measure put in place, the problem of graduates unable move out of college towns will only get worse.”

More than a few college students say they seem to see their own sad future in graduates who compete with younger ones over finding homes in college towns.

A Yonsei University senior majoring in economics said, “I try to comfort myself thinking that things will get better if I get a job in the future. But when I see college graduates in town, I feel down because getting a job doesn`t seem to help them.”

Experts warn that more graduates will continue living in college towns due to prolonged youth unemployment. Kim Hyeon-ah, a researcher at the Construction and Economy Research of Korea, said, “The inability of new employees or college graduates looking for jobs to move out of college town shows that the quality of housing and life of those in their 20s and 30s have been worsening... The only solution would be the creation of quality jobs.”

yunjung@donga.com ryu@donga.com