Housing businesses' outlook for May apartment move-ins was found to remain in negative territory. It is analyzed as the effect of factors such as a freeze in the dwellings market.
Korea Housing Institute (hereinafter KHI) said on the 14th that, based on a survey of housing businesses, this month's nationwide apartment move-in outlook index came in at 74.1, up 4.8 points (p) from the previous month. The index gauges whether people who bought apartments will be able to pay the balance as normal and move in. A reading below 100 means negative expectations for the move-in economy are dominant, and 100 or above indicates the opposite.
KHI explained, "As the index plunged more than 25 points in the previous month, there were slight rebounds in most regions nationwide due to a base effect, but with the dwellings market freeze continuing, housing businesses' move-in outlooks still remain at negative levels." It added, "With demand-suppressing factors such as high mortgage loan lending rates and loan regulations persisting, complex forces including discussions on tax reform, the end of the capital gains tax heavy taxation grace period, and a growing wait-and-see stance ahead of the June local elections have been at work."
The Seoul metropolitan area (78.4) rose 1.7p from the previous month. Seoul (93.9) was up 0.4p, Incheon (68.0) rose 8.0p, and Gyeonggi (73.5) fell 3.1p. Major metropolitan cities were up 6.1p from the prior month to 79.3, and provincial areas were up 4.9p to 68.6, it was found.
Meanwhile, the nationwide apartment move-in rate in April was 55.8%, down 4.8 percentage points from the previous month. The Seoul metropolitan area (82.2%) rose 0.4 percentage point, and the five major metropolitan cities (57.8%) rose 1.1 percentage points. However, other regions (44.3%) fell 11.4 percentage points. Within the metropolitan area, Seoul (92.2%) rose 1.2 percentage points, while Incheon-Gyeonggi (77.1%) fell 0.2 percentage point.
The most common reason for non-move-in was failure to secure balance loans (40.8%), followed by delays in selling existing dwellings (34.7%) and failure to secure tenants (16.3%).