September Housing Market, Nationwide Red Lights in Effect... "Real Estate Slump Foreseen, Worsening Sentiment"

National Apartment Sales Outlook Index 43.7
Deterioration in Nationwide Index Except Gyeonggi Region
"Gyeonggi Also Returned to Average Level"

Source=Korea Housing Industry Institute

[Asia Economy Reporter Hwang Seoyul] The apartment pre-sale outlook for September is expected to worsen in all regions nationwide except Gyeonggi Province. Although Gyeonggi also showed an average recovery compared to the significant deterioration in last month's outlook, the pre-sale market nationwide has effectively turned red.

According to the Korea Housing Industry Research Institute (hereinafter referred to as KHIRI) on the 20th, the apartment pre-sale outlook index for September was forecasted at 43.7. This is a decline of 17.6 points from last month (61.3). The index has been falling for four consecutive months since May (87.9). The apartment pre-sale outlook index is a measure that supports market management by assessing the situation and risks of the pre-sale market, surveyed among members of the Korea Housing Association and the Korea Housing Construction Association.

Source=Korea Research Institute for Human Settlements

Specifically, the metropolitan area was predicted at 49.4, down 4.3 points from the previous month. Seoul is expected to drop 9.2 points to 59.0, and Incheon is forecasted to fall 8.4 points to 35.7.

Gyeonggi Province is expected to slightly rise to 53.4 points, but KHIRI judged that "this is not an actual improvement in pre-sale outlook but rather a return to the metropolitan area average due to the excessively negative outlook in August compared to other metropolitan areas."

The outlook for metropolitan cities outside the capital was predicted at 41.7, showing a very negative pre-sale outlook compared to last month (59.5). Except for Gwangju (52.4) and Daejeon (45.5), Incheon (35.7), Busan (38.5), and Daegu (39.3) were forecasted with an outlook index below 40.

The outlook for provincial areas also dropped to 43.0, down 22.6 points from last month (65.6). All regions showed a decline, including Gyeongbuk by 27.9 points (70.0→42.1), 11 points (56.5→45.5), Chungbuk by 26.8 points (62.5→35.7), and Gyeongnam by 24.7 points (64.7→40.0).

Sejong, which had the highest index last month, recorded the largest decline nationwide, falling 46.7 points to 33.3 this month.

KHIRI analyzed that "the burden of rising interest rates and economic uncertainty have overlapped, leading to a predicted real estate market slump and significantly deteriorating the sentiment of apartment pre-sale businesses."

Meanwhile, besides market stagnation factors, the announcement of the pre-sale price ceiling system reform and delays in supply schedules centered on large-scale complexes caused the nationwide average pre-sale price index for September (105.6) to fall by 1.3 points compared to the previous month, and the pre-sale volume index (75) to drop by 14.2 points.

Although the unsold housing index (119.7) is expected to decrease by 4.6 points, KHIRI warned, "It is necessary to be cautious about the housing market slump due to the accumulating unsold housing stock."

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