▲ A view of apartment complexes in Seoul
The apartment move-in outlook index for July has risen significantly across the country, driven by a combination of recent home price increases, expectations for improved financial conditions due to a revitalized stock market, and forecasts of a future supply shortage.
The Korea Housing Institute announced on July 9 that, based on a survey of housing developers, the national apartment move-in outlook index for this month reached 97.5, up 12.9 points from the previous month.
The move-in outlook index is a metric that predicts whether those who have purchased apartments will be able to pay their remaining balances and move in as scheduled.
An index reading above 100 indicates that positive sentiment regarding the move-in environment is dominant, while a reading below 100 suggests that negative sentiment prevails.
By region, the index rose by 20.9 points in the Seoul metropolitan area (from 81.7 to 102.6), 18.9 points in metropolitan cities (from 84.4 to 103.3), and 5.5 points in provincial areas (from 85.8 to 91.3).
After falling to 69.3 in April due to tighter lending and external uncertainties such as the Middle East conflict, the national move-in outlook index has shown a steep recovery for three consecutive months, reaching 74.1 in May, 84.6 in June, and 97.5 in July.
The institute analyzed that this is the result of a complex interplay of factors, including improved market sentiment due to rising housing prices, better financial conditions fueled by a strong stock market, and expectations of a future decrease in supply.
Within the Seoul metropolitan area, the index rose by 16.0 points in Seoul (from 102.7 to 118.7), 18.9 points in Incheon (from 70.3 to 89.2), and 27.8 points in Gyeonggi Province (from 72.2 to 100.0).
The institute noted that while the upward trend in home prices in the metropolitan area continues, the strength in housing prices, particularly around the semiconductor belt including Dongtan, has significantly improved market sentiment.
Among metropolitan cities, Daegu saw the largest increase, rising 29.3 points (from 81.8 to 111.1). Other cities also saw gains: Daejeon rose 23.9 points (from 82.3 to 106.2), Busan 21.9 points (from 72.2 to 94.1), Gwangju 15.6 points (from 77.7 to 93.3), Ulsan 15.3 points (from 92.3 to 107.6), and Sejong 7.6 points (from 100.0 to 107.6).
Daegu, Ulsan, Sejong, and Daejeon all exceeded the baseline of 100, indicating that positive expectations for move-in conditions are dominant in these areas.
The institute explained that for Daegu, the results reflect expectations of reduced burdens from non-move-ins due to a decrease in unsold units after completion and a reduction in the volume of new move-ins.
In provincial regions, the index rose by 25.0 points in South Chungcheong Province (from 75.0 to 100.0), 22.2 points in South Jeolla Province (from 66.6 to 88.8), 13.4 points in Gangwon Province (from 66.6 to 80.0), and 8.6 points in Jeju (from 71.4 to 80.0).
Conversely, the index fell by 10.0 points in North Jeolla Province (from 100.0 to 90.0), 8.4 points in North Gyeongsang Province (from 100.0 to 91.6), and 7.1 points in South Gyeongsang Province (from 107.1 to 100.0).
The institute explained that while the overall outlook has improved due to a sharp drop in move-in volumes in provincial areas, recovery expectations in some regions remain limited due to the accumulation of unsold units and sluggish local economies.
The institute projected that although banks are tightening criteria for mortgage loans amid rising household debt, investment sentiment in the housing market as a whole is likely to improve for the time being, supported by liquidity in the stock market.
It added that while the Seoul metropolitan area is likely to maintain a favorable trend supported by both actual and investment demand, continuous monitoring is necessary for provincial areas, where the pace of recovery may be slower due to the burden of unsold units and local economic conditions.
The national apartment move-in rate for June was 69.9%, down 1.3 percentage points from the previous month.
The rate fell from 84.8% to 83.0% in the Seoul metropolitan area and from 70.1% to 62.9% in the five major metropolitan cities and Sejong, while it rose from 66.9% to 70.2% in other regions.
Reasons for not moving in were reported in the following order: delays in selling existing homes (36.7%), failure to secure balance loans (26.5%), failure to secure tenants (20.4%), and delays in selling pre-sale rights (2.0%).
(Photo: Yonhap News)
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