This month, the outlook for apartment move-ins across the country has declined. In the metropolitan area, the drop was more pronounced due to a slowdown in transactions and an increase in wait-and-see attitudes following stricter real estate regulations on loans and taxes.
On September 10, the Korea Housing Industry Institute (KHI) reported that the national apartment move-in outlook index for September is 87.6, a decrease of 6.8 points from the previous month.
The move-in outlook index predicts whether individuals who have purchased apartments will be able to pay the remaining balance and move in as scheduled. A score below 100 indicates a negative outlook for the move-in market, while a score above 100 suggests a positive outlook.
In the metropolitan area, the move-in outlook index fell to 81.0, down 8.4 points from the previous month. In Seoul, the index dropped to 90.6, a decrease of 9.4 points, while Incheon fell to 65.3, down 18.5 points. Conversely, Gyeonggi Province saw a slight increase to 87.0, up 2.7 points.
KHI noted, "The uncertainty stemming from stricter household loan management and tax regulations on non-residential properties has led to a slowdown in housing transactions, particularly in key areas like Gangnam and the Han River belt. However, a balloon effect has emerged, with demand shifting to the outskirts of Seoul and southern Gyeonggi Province, which has somewhat limited the extent of the decline in the metropolitan area’s move-in outlook."
In major cities, the index fell to 92.9, down 1.0 point from the previous month. Busan dropped from 88.8 to 80.0, a decrease of 8.8 points, and Daejeon fell from 92.8 to 85.7, down 7.1 points. In contrast, Gwangju increased from 100.0 to 107.1, up 7.1 points, and Daegu rose from 81.8 to 85.0, an increase of 3.2 points. Ulsan and Sejong remained unchanged at 100.0.
In rural areas, the index fell to 86.0, down 10.8 points from the previous month. Jeju experienced the largest drop, falling 26.2 points to 66.6, while Jeollanam-do decreased by 22.3 points to 77.7, and Gangwon fell by 15.0 points to 75.0. Chungbuk dropped 14.3 points to 85.7, and Gyeongbuk fell 8.4 points to 91.6. Jeollabuk-do and Gyeongnam remained at 100.0, while Chungnam stayed at 91.6.
Last month, the actual national apartment occupancy rate was 59.5%, down 8.6 points from the previous month. In the metropolitan area, it decreased from 85.4% to 80.8%, a drop of 4.6 points, while the four major cities outside the metropolitan area, along with Gwangju and Sejong, fell from 58.9% to 55.5%, down 3.4 points. Other regions saw a significant decline from 68.5% to 51.6%, a drop of 16.9 points.
The main reasons for unoccupied units included failure to secure final payment loans at 37.2%, delays in selling existing homes at 31.4%, lack of tenants at 15.7%, and delays in selling pre-sale rights at 5.9%. As major banks tightened their mortgage lending criteria in the second half of the year, the proportion of respondents citing failure to secure final payment loans, which had dropped to 26.5% in June, continued to rise last month.
KHI stated, "The simultaneous decline in the move-in outlook for September and the occupancy rate for August suggests that the worsening funding conditions due to stricter loan regulations are impacting the move-in conditions for prospective residents. A comprehensive response plan considering the housing market's supply-demand conditions and funding environment is necessary."
On September 10, the Korea Housing Industry Institute (KHI) reported that the national apartment move-in outlook index for September is 87.6, a decrease of 6.8 points from the previous month.
The move-in outlook index predicts whether individuals who have purchased apartments will be able to pay the remaining balance and move in as scheduled. A score below 100 indicates a negative outlook for the move-in market, while a score above 100 suggests a positive outlook.
In the metropolitan area, the move-in outlook index fell to 81.0, down 8.4 points from the previous month. In Seoul, the index dropped to 90.6, a decrease of 9.4 points, while Incheon fell to 65.3, down 18.5 points. Conversely, Gyeonggi Province saw a slight increase to 87.0, up 2.7 points.
KHI noted, "The uncertainty stemming from stricter household loan management and tax regulations on non-residential properties has led to a slowdown in housing transactions, particularly in key areas like Gangnam and the Han River belt. However, a balloon effect has emerged, with demand shifting to the outskirts of Seoul and southern Gyeonggi Province, which has somewhat limited the extent of the decline in the metropolitan area’s move-in outlook."
In major cities, the index fell to 92.9, down 1.0 point from the previous month. Busan dropped from 88.8 to 80.0, a decrease of 8.8 points, and Daejeon fell from 92.8 to 85.7, down 7.1 points. In contrast, Gwangju increased from 100.0 to 107.1, up 7.1 points, and Daegu rose from 81.8 to 85.0, an increase of 3.2 points. Ulsan and Sejong remained unchanged at 100.0.
In rural areas, the index fell to 86.0, down 10.8 points from the previous month. Jeju experienced the largest drop, falling 26.2 points to 66.6, while Jeollanam-do decreased by 22.3 points to 77.7, and Gangwon fell by 15.0 points to 75.0. Chungbuk dropped 14.3 points to 85.7, and Gyeongbuk fell 8.4 points to 91.6. Jeollabuk-do and Gyeongnam remained at 100.0, while Chungnam stayed at 91.6.
Last month, the actual national apartment occupancy rate was 59.5%, down 8.6 points from the previous month. In the metropolitan area, it decreased from 85.4% to 80.8%, a drop of 4.6 points, while the four major cities outside the metropolitan area, along with Gwangju and Sejong, fell from 58.9% to 55.5%, down 3.4 points. Other regions saw a significant decline from 68.5% to 51.6%, a drop of 16.9 points.
The main reasons for unoccupied units included failure to secure final payment loans at 37.2%, delays in selling existing homes at 31.4%, lack of tenants at 15.7%, and delays in selling pre-sale rights at 5.9%. As major banks tightened their mortgage lending criteria in the second half of the year, the proportion of respondents citing failure to secure final payment loans, which had dropped to 26.5% in June, continued to rise last month.
KHI stated, "The simultaneous decline in the move-in outlook for September and the occupancy rate for August suggests that the worsening funding conditions due to stricter loan regulations are impacting the move-in conditions for prospective residents. A comprehensive response plan considering the housing market's supply-demand conditions and funding environment is necessary."
* This article has been translated by AI.
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