27,735 Households Scheduled to Move In August... Impact of Interest Rate Hikes?

96% of Units Are Small to Medium-Sized Under 85㎡

Impact of Interest Rate Hikes... Unavoidable Effects on New Apartment Move-In Market

Temporary Increase in Jeonse Supply and Preference for Monthly Rent May Make Finding Jeonse Tenants Difficult

[Asia Economy, Reporter Kim Min-young] The nationwide apartment move-in volume scheduled for August is expected to total 27,735 units, marking an increase for two consecutive months since June. While the move-in volume in the Seoul metropolitan area slightly decreased, the increase in local areas such as Daegu and Daejeon contributed to the overall rise. However, the rise in interest rates is expected to dampen buyer sentiment, affecting the move-in market as well. Additionally, if a large volume of jeonse (long-term lease) units flood the market coinciding with the move-in periods of large complexes, combined with the recent preference for monthly rent, it may become difficult to find jeonse tenants.

According to Zigbang on the 25th, the nationwide apartment move-in volume scheduled for August is expected to reach 27,735 units, increasing for two consecutive months since June. This is the first time this year that the monthly move-in volume shows a continuous upward trend in August.

Although move-in volumes increased in Seoul and Incheon, the volume in Gyeonggi Province slightly decreased, resulting in a total of 15,382 units in the Seoul metropolitan area, down 11% from July's 17,288 units. On the other hand, local areas such as Daegu and Daejeon saw an increase to 12,353 units, about 66% higher, driving the overall increase in August move-in volume.

By area size, units under 85㎡ account for 96% of the total volume, making most of the August move-in units small to medium-sized. Units over 85㎡ total 1,105, with Daegu (409 units) and Incheon (331 units) leading the supply. Among these, large units exceeding 135㎡ make up 0.1%, with 17 units supplied.

By city/province, Gyeonggi has the highest volume with 8,016 units, followed by Incheon (5,655 units), Daegu (3,424 units), Daejeon (1,881 units), and Seoul (1,711 units). In Gyeonggi, large complexes in Suwon, Paju, and Anyang are moving in, while Incheon will see move-ins in districts such as Geomdan, Songdo, and Michuhol. In regions with high move-in volumes in August like Gyeonggi, Incheon, and Daegu, many more move-ins are scheduled for the remainder of the year, likely increasing jeonse listings in these areas.

A total of 37 complexes will have move-ins in August. In the Seoul metropolitan area, there are 16 complexes: 8 in Gyeonggi, 5 in Incheon, and 3 in Seoul. In local areas, Daegu has 6 complexes, Jeonnam 3, Busan 2, totaling 21 complexes. A representative complex moving in Seoul is Raemian Elinite located in Yongdu-dong, Dongdaemun-gu. This complex redeveloped from Yongdu 6th District consists of 1,048 units ranging from 51 to 121㎡. In Paju, Gyeonggi Province, Unjeong New Town Prugio Parcensa, consisting of 1,745 units, will begin move-ins at the end of August. Hillstate Prugio Suwon is located in Gyodong, Paldal-gu, Suwon, Gyeonggi Province. Redeveloped from Paldal 6th District, it is a mammoth complex with 2,586 units. Additionally, Daemyung Station Central Elife in Daemyung-dong, Nam-gu, Daegu, and Doma e-Pyeonhansesang Forena in Daejeon are also preparing for move-ins.

However, the new apartment move-in market is unlikely to escape the impact of interest rate hikes. Ham Young-jin, head of Zigbang Big Data Lab, said, "For those moving into new apartments using the proceeds from selling their existing apartments, the rise in mortgage interest rates may dampen their willingness to buy, making it difficult to sell their current apartments."

It is also expected to affect the jeonse market. As jeonse loan interest rates rise, more tenants are opting for monthly rent, and if a large volume of jeonse units flood the market coinciding with move-ins, it will be difficult to find tenants. According to the Korea Housing Industry Research Institute, the main causes of delayed new apartment move-ins include failure to secure tenants, delays in selling existing homes, and failure to secure final payment loans.

Ham Young-jin of the Big Data Lab added, "The increase in move-in volume is expected to continue through September following July and August, and the resolution of jeonse supply is likely to be slow, especially in areas with concentrated new apartment move-ins."

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