4 out of 10 Fail to Secure Balance Loans, Unable to Move In... January Housing Market Outlook 'Cloudy'

[Asia Economy Reporter Ryu Tae-min] It has been revealed that the rate of people unable to move into apartments due to failure to secure balance loans from banks, following the government's strengthened loan regulations, has reached its highest level.

According to the Move-in Business Survey Index (HOSI) data released by the Korea Research Institute for Housing Industry on the 20th, among the reasons for non-move-in in December last year, the response of 'failure to secure balance loans' was the highest at 40.7%. This means that 4 out of 10 successful applicants could not move into the apartments they purchased because they were unable to obtain balance loans.

The response rate for failure to secure balance loans rose by more than 10 percentage points in one month, from 29.3% in November. The previous highest was 34.1% in October last year, and it set a new record by exceeding 40% in December.

This is interpreted as a result of the difficulty in obtaining loans from financial institutions due to the financial authorities' strengthened household debt management policies since the end of last year. In particular, from this year, balance loans are also included in the calculation of the individual Debt Service Ratio (DSR), which is expected to further reduce loan limits, leading to an increase in cases of failure to move in.

Meanwhile, the HOSI forecast for this month, announced by the Korea Research Institute for Housing Industry on the same day, was 82.6, down 9.6 points from the previous month. HOSI is an index that comprehensively assesses the move-in conditions of apartment complexes that are about to be occupied or are currently being occupied, as judged by housing suppliers. A score above the baseline of 100 indicates favorable move-in conditions, while a score below indicates deterioration.

By region, Ulsan (92.8), Sejong (91.6), and Jeonnam (92.3) recorded scores in the 90s. Daegu (63.6) and Daejeon (69.2) were the lowest in the 60s, while other regions are expected to show scores in the 70s to 80s.

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