May Apartment Move-in Outlook Declines Compared to April... Jusanyeon "Measures Needed to Address Decreased Occupancy Rate"

Jusan Research May Apartment Outlook Index 85.4
Down 6.3 Points from Last Month
Loan Interest Rates Up, Sales Transactions Down, Due to Economic Recession
April Occupancy Rate Slightly Down Compared to March
Jusan Research "Need for Real Demand Occupant Measures"

Apartment Move-in Outlook Index for May 2022 / Source: Korea Research Institute for Housing and Urban Affairs

[Asia Economy Reporter Hwang Seoyul] The outlook for apartment move-ins in May is expected to be more negative than in April due to rising loan interest rates and an economic downturn. Last month's occupancy rate also slightly decreased compared to March, highlighting the need for measures to increase occupancy rates.

According to the Korea Housing Industry Research Institute (hereafter KHIRI) on the 13th, the nationwide apartment outlook index for May is projected to drop by 6.3 points from last month (91.7) to 85.4. This is expected due to factors such as rising loan interest rates, decreased sales transactions, and an economic recession caused by the Ukraine war. The base effect of last month's significant increase in outlook due to expectations of expanded supply and deregulation under the Yoon Seok-yeol administration also appears to have played a role. The survey was conducted among members of the Korea Housing Association and the Korea Housing Construction Association.

Specifically, the metropolitan area recorded 99.4, down 3.7 points from last month (103.1), and the major cities dropped 7.1 points to 86.1. In particular, Busan saw a sharp decline of 27.3 points from last month (100.0) to 72.7.

The nationwide apartment occupancy rate in April (82.3%) also slightly decreased compared to March (82.7%), raising the need for measures to support actual homebuyers. The reasons for non-occupancy last month were delayed sales of existing homes (36.7%), failure to secure balance loans (30.6%), and failure to secure tenants (24.5%), in that order.

Researcher Seo Hyunseung of KHIRI stated, "Due to the increased cost burden from rising loan interest rates, measures for actual homebuyers seem important," and added, "To prevent a decline in occupancy rates, measures such as easing loan regulations for the homeless are necessary."

Meanwhile, the occupancy rate in the metropolitan area last month (88.9%) rose by 1.3 percentage points compared to the previous month (87.6%). The six major cities recorded 83.8%, and other regions 78.7%, both down 1.3 percentage points and 0.3 percentage points respectively compared to March.

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