With stricter lending rules and higher interest rates increasing financing burdens, the nationwide apartment presales market has frozen.
The Korea Housing Institute said on the 8th that, based on a survey of housing project operators, the nationwide apartment presales outlook index for September was 86.3, down 6.9 points from the previous month. When the presales outlook index exceeds 100, it means more operators view the future presales market positively; below 100 means the opposite.
In the Seoul metropolitan area, the presales outlook index fell 4.5 points from 88.5 to 84.0. Seoul (97.3→93.9), Incheon (80.6→74.1), and Gyeonggi (87.5→83.9) all declined. The institute analyzed that, in addition to heavier financing burdens, uncertainty over real estate tax reforms and high presale prices had an impact.
Outside the metropolitan area, the index fell 7.4 points from 94.2 to 86.8. South Jeolla (88.9→60.0) dropped 28.9 points, the steepest decline. Jeju (100.0→75.0), South Gyeongsang (100.0→81.8), and Gangwon (91.7→80.0) followed. Busan (72.2→82.4), Daegu (78.3→86.4), South Chungcheong (83.3→84.6), and Daejeon (93.8→94.4) rose.
The institute said, "In a situation where unsold inventory is piling up and demand for dwellings remains weak, the outlook index appears to have fallen as financing burdens from rising interest rates have increased, as in the metropolitan area."
The September presale price outlook index came in at 108.8, up 1.2 points from the previous month. This is attributed to continued upward pressure on construction costs such as building material prices and labor costs.
The outlook index for unsold inventory jumped 14.9 points from 91.0 to 105.9. The institute explained, "With unsold homes in the provinces accumulating, nationwide unsold dwellings have increased for three straight months, expanding expectations that unsold units will rise going forward."