7 out of 10 Zigbang Users "Intend to Purchase a Home This Year"

Slight Decrease in Purchase Intentions and Delay in Purchase Timing After 2.20 Measures Announcement

[Image source=Yonhap News]

[Asia Economy Reporter Lim On-yu] It was found that 7 out of 10 Zigbang users have the intention to purchase a house. The higher the age group, the more people considered buying. However, the proportion of those intending to purchase slightly decreased after the announcement of the February 20 real estate measures due to strengthened regulations.

Zigbang announced on the 4th that a survey conducted on 4,980 application users showed that 71.2% (3,547 people) intended to purchase a house in 2020. The survey was conducted over 12 days from the 13th to the 24th of last month.

The survey results showed that the intention to purchase a house was higher in older age groups. Those under their 20s, who have lower financial capacity, showed a lower intention to purchase compared to other age groups.

However, after the announcement of the February 20 measures, purchasing sentiment appeared somewhat subdued. Before the announcement, 72.8% of respondents expressed an intention to purchase, whereas after the announcement, it dropped by 2.9 percentage points to 69.9%.

Earlier, the government designated Suwon’s Yeongtong, Gwonseon, and Jangan districts, Anyang’s Manan district, and Uiwang city as regulated areas through the February 20 measures. Loan regulations for these regulated areas were also tightened. Previously, the loan-to-value ratio (LTV) was recognized up to 60%, but going forward, it will be 50% for portions up to 900 million KRW and 30% for amounts exceeding 900 million KRW.

The most common type of housing purchase was 'existing apartment purchase' at 53% (1,879 people). This was followed by ▲new apartment subscription (24.9%) ▲purchase of row houses or villas (9.3%) ▲purchase of apartment pre-sale rights or move-in rights (6.9%).

Among the 3,547 respondents intending to purchase a house this year, the most considered purchase cost was ‘under 300 million KRW’ at 41.1%. Next was ▲over 300 million KRW to 500 million KRW (34.1%), with over 70% considering purchasing a house priced under 500 million KRW.

By product type, respondents considering new apartment subscriptions and apartment pre-sale or move-in rights mostly considered the ‘over 300 million KRW to 500 million KRW’ range. For other types such as general apartments, detached houses, row houses, villas, and officetels, the ‘under 300 million KRW’ range was the most common.

When asked about the timing of purchase, 27% said they planned to buy this year but the timing was ‘undecided’. This was followed by ▲2nd quarter (24.1%) ▲1st quarter (23.4%) ▲3rd quarter (14.5%) ▲4th quarter (11.0%). By age group, undecided responses were higher among those under 20, in their 30s, and 50s, while those in their 40s most frequently planned to purchase in the 2nd quarter at 25.8%. Those aged 60 and above also most frequently planned to purchase in the 2nd quarter.

After the February 20 measures, the proportion of respondents planning to purchase in the 3rd or 4th quarter increased compared to before the announcement. Before the announcement, 12.8% planned to purchase in the 3rd quarter and 9.2% in the 4th quarter, but after the announcement, these increased to 16.0% and 12.6%, respectively, indicating a trend toward delaying purchase timing.

Among respondents intending to purchase a house, the highest proportion considered the southwestern region of Gyeonggi Province (26.6%). Ham Young-jin, head of Zigbang Data Lab, said, "Interest seems to have increased as areas like Suwon have recently seen significant price rises and become a hot topic," adding, "Most respondents who participated in the survey also reside in the southwestern region of Gyeonggi Province." According to Zigbang’s analysis, the majority of respondents tend to consider purchasing in their current residence or nearby surrounding areas.

Meanwhile, 28.8% of the total 4,980 respondents answered that they have no intention to purchase a house this year. The most common reason for not intending to purchase was ‘the housing prices have risen significantly, increasing the financial burden’ (40.1%). This was followed by ▲‘prices have risen a lot and are expected to fall soon’ (37.0%) ▲‘waiting to observe changes in real estate policies’ (10.3%) ▲‘already owning a house’ (9.8%) ▲‘due to economic recession’ (9.5%).

Ham Lab chief advised, "With the continued low interest rate environment and limited places for funds to flow in, it is highly likely that demand for housing purchases will continue to emerge," adding, "Especially, the demand for home purchases for actual residence by single or two-person households and those aiming to own their own home is steadily increasing, so policies for healthy housing transactions are necessary."

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