Housing Industry Research Institute "New Coronavirus Does Not Significantly Impact Housing Supply" (Comprehensive)

[Asia Economy Reporter Onyu Lim] It is forecasted that the impact of the novel coronavirus infection on housing supply contraction will not be significant in the short term. However, if the situation prolongs, deterioration of the housing business environment is inevitable.

The Korea Housing Industry Research Institute stated on the 7th, "Although there are concerns about housing supply contraction due to the recent novel coronavirus situation, looking at past SARS (Severe Acute Respiratory Syndrome) and MERS (Middle East Respiratory Syndrome) incidents, the short-term impact is expected to be minimal."

According to reference materials distributed by the Korea Housing Industry Research Institute citing data from the Ministry of Land, Infrastructure and Transport and Real Estate 114, during the domestic SARS alert period (March to July 2003), housing permit volumes were 46,113 units in March, 27,613 units in April, 35,838 units in May, 148,875 units in June, and 45,755 units in July. Notably, the permit volume in June (148,875 units) was the highest of that year.

During the same period, sales volumes also maintained an overall upward trend with 20,675 units in March, 29,246 units in April, 35,155 units in May, 30,757 units in June, and 35,659 units in July.

During the domestic MERS alert period (May to December 2015), permit, groundbreaking, sales, and completion volumes generally showed an upward trend.

Permit volumes during this period were 56,861 units in May, 73,102 units in June, 82,836 units in July, 69,269 units in August, 87,955 units in September, 64,200 units in October, 62,823 units in November, and 98,165 units in December.

Groundbreaking volumes were 54,854 units in May, 65,325 units in June, 54,593 units in July, 68,609 units in August, 50,198 units in September, 98,730 units in October, 73,351 units in November, and 82,434 units in December.

Sales volumes were 49,830 units in May, 39,019 units in June, 52,882 units in July, 22,223 units in August, 56,850 units in September, 65,722 units in October, 74,775 units in November, and 55,348 units in December.

Completion volumes were 27,763 units in May, 42,000 units in June, 46,872 units in July, 37,974 units in August, 38,238 units in September, 43,344 units in October, 36,985 units in November, and 67,185 units in December.

Meanwhile, following the December 16 real estate measures, strong regulations have continued, and difficulties in the nationwide housing business environment are expected to persist in February.

The Korea Housing Industry Research Institute announced that the nationwide Housing Business Survey Index (HSBI) forecast for February is 81.9. The institute analyzed, "Although it rose slightly by 6.2 points compared to the previous month, this is considered a result of the January base effect. In Seoul, Daegu, Gwangju, and other areas, the housing industry outlook has declined, indicating increasing difficulties."

Seoul's HSBI forecast is 70.5, maintaining the 70-point level, suggesting growing challenges. Ongoing regulations related to redevelopment projects, the impact of the private land price ceiling system, and the off-season period are compounding negative effects.

By region, HSBI showed significant declines in Busan (96.5) and Daegu (81.8) compared to the previous month, indicating reduced business expectations. Gwangju (81.4), Daejeon (81.4), and Ulsan (84.2) also remained in the 80-point range, expanding negative outlooks. Daegu (81.8) dropped more than 10 points from the previous month, breaking below the 90-point level for the first time in three months. The Korea Housing Industry Research Institute analyzed, "The recent designation of Seo-gu as an unsold housing management area and the emergence of unsold housing issues have led to reduced business expectations."

Gwangju (81.4) maintained the previous month's level, while Daejeon (81.4) and Ulsan (84.2) also stayed in the 80-point range. Busan (96.5) still recorded the highest nationwide score but fell sharply by more than 10 points compared to the previous month, breaking below the 100-point level for the first time in three months.

This content was produced with the assistance of AI translation services.