This Year, 6 out of 10 Experts Predict 'Rise' in House Prices vs Real Estate Agents Predict 'Fall'

Apgujeong Hyundai Apartment_Real Estate Reference Photo / Photo by Hyunmin Kim kimhyun81@

There are mixed forecasts for housing prices this year. While 6 out of 10 experts predict a 'rise,' 6 out of 10 real estate agencies expect a 'decline.'

According to a survey conducted by KB Management Research Institute from the 5th to the 11th of last month, targeting 527 licensed real estate agents and 161 real estate experts from construction, development, academia, and finance sectors, 64% of real estate experts anticipated that housing prices will increase this year. In particular, 74% of experts expected housing prices in the 수도권 (Sudogwon, Seoul Metropolitan Area) to rise, with 33% indicating that the increase would be 'within 3%.'

Experts cited reasons for the expected rise in 수도권 housing prices as supply shortages (25%), policy changes after the presidential election (16%), and a decrease in listings due to strengthened government regulations (14%).

On the other hand, 63% of licensed real estate agents responded that prices would "fall." Among them, 54% of 수도권 agents and 53% of non-수도권 agents anticipated a downturn, with the largest group (38%) expecting a decline 'within 3%.'

Real estate agents pointed to loan regulations, the burden of purchase prices, and increased transaction costs as factors contributing to the decline.

The institute assessed the bubble debate caused by the rapid rise in housing prices and concluded that a gradual adjustment is more likely than a sharp drop due to bubble collapse.

In the 'KB Real Estate Report' released that day, the institute explained, "Unless there is a shock similar to the foreign exchange crisis, the risk of a sharp decline appears low," adding, "Above all, the high market confidence in housing as an asset is a major reason."

Since the global financial crisis, only Seoul and 수도권 have experienced somewhat mild adjustments, while other regions have entered a long-term upward trend since 2010, strengthening the belief that "housing is a quality long-term asset."

The institute stated, "Because confidence in housing remains high due to the prolonged market rise, the possibility of a sharp drop is considered low."

Meanwhile, according to the report, nationwide housing sale prices rose 15% in 2021, marking the highest annual increase since 2002. The increase last year was similar to the total rise over the five years from 2016 to 2020.

By region, Incheon led with a 23.7% increase, followed by Gyeonggi (22.5%), Daejeon (17.0%), and Seoul (12.5%).

In Seoul, notable increases were seen in Nowon (21.7%), Dobong (20.1%), Gangbuk (16.9%), Yangcheon (15.5%), and Guro (15.4%) districts.

Although housing prices surged significantly, the volume of housing transactions last year (approximately 1,015,000 units) decreased by 20.6% compared to the previous year.

Regarding jeonse (long-term lease) prices, they rose 9.4% nationwide and 11.3% in 수도권 last year.

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