January Nationwide Housing Business Outlook 77.6... Seoul 'Clear' Regions 'Cloudy'

[Asia Economy Reporter Ryu Tae-min] The outlook for the housing business market is worsening. Unlike Seoul, where expectations for redevelopment and reconstruction remain positive, negative forecasts are increasing in Gyeonggi Province and other metropolitan cities, leading to a decline in the nationwide Housing Business Survey Index (HBSI) forecast for January.

On the 13th, the Korea Housing Industry Research Institute (KHIRI) announced that the nationwide HBSI forecast for January dropped by 0.2 points from the previous month to 77.6. The HBSI is an index that comprehensively reflects housing developers' assessment of the housing business market. A value above 100 indicates an expectation of market improvement.

Seoul's HBSI forecast for this month was 95.9, up 0.6 points from the previous month. The index remained above the 90 mark as regulatory easing policies focused on maintenance projects continued. With increased regulatory relaxation efforts on redevelopment projects, such as the selection of private redevelopment candidate sites and rapid integrated planning, expectations for improvement in the housing business market centered on redevelopment sites in Seoul are growing.

In contrast, negative outlooks for housing business conditions expanded in provincial and metropolitan cities. Daegu (50) recorded its lowest level in six years, maintaining the lowest nationwide forecast for three consecutive months. Busan (84.0) and Daejeon (84.2) fell by 16 points and 21.3 points respectively compared to the previous month.

The actual HBSI for last month was 82.0, down 2.7 points from the previous month. Incheon (93.1), Jeonnam (92.8), and Gyeonggi (91.6) showed favorable results, but Seoul (89.7), Gwangju (89.4), Gangwon and Chungnam (87.5), Sejong (76.9), Daejeon (73.6), and Jeju (71.4) remained in the 70s to 80s range.

A KHIRI official stated, “Negative forecasts for the housing business market are expected to expand mainly in the metropolitan area excluding Seoul and in provincial metropolitan cities.” He added, “Although Sejong recorded a forecast exceeding the baseline for the first time in five months, considering recent unsold housing issues, it is difficult to interpret this as a recovery in the supply market.”

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