Seoul apartment purchase sentiment ‘stopped’ after 8 weeks to control the speed of deregulation
The sentiment to buy apartments in Seoul, which has been recovering for seven weeks in a row since the presidential election, has recently stopped. It is analyzed that interest rate hikes continued amid loan regulations and the Presidential Takeover Committee fluctuated in relation to the policy to ease regulations on real estate, which affected the buying sentiment.
According to a survey by the Korea Real Estate Agency, as of April 25, the Seoul apartment sales and demand index was 90.5, down slightly from 91.4 the previous week. The supply-demand index is determined between 0 and 200 by indexing the proportion of supply and demand through a survey by the Korea Real Estate Agency. The lower the buy-and-supply index is below the baseline (100), the more people want to sell houses than those who want to buy houses in the market.
The Seoul apartment sales and demand index rose for the seventh week in a row on expectations for the new government to ease regulations such as reconstruction and taxation, but the recent upward trend seems to have stopped. Amid the increase in the number of properties for tax saving on capital gains tax by multi-homeowners, there is an atmosphere of reluctance to buy as additional interest rate hikes and the new government’s move to adjust the speed of deregulation overlap.
By region, the northwestern part of Seoul (Eunpyeong, Seodaemun, Mapo-gu) dropped from 89.1 in Jeonju to 87. The northeast region, where Nowon, Dobong, and Gangbuk-gu are located, also fell from 88.7 to 86.8 during the same period. In downtown areas (Yongsan and Jongno-gu, etc.) where house prices were strong after the relocation of the presidential office, the number also decreased slightly from 91.3 to 90.4. Gyeonggi-do and Incheon also could not avoid the downward trend. Gyeonggi-do fell from 92.5 to 91 and Incheon from 94.5 to 94, respectively. Meanwhile, the Jeonse supply and demand index stood at 97.1 on a nationwide basis, an increase from the previous week with 96.8 people, indicating that the demand for Jeonse compared to Jeonse items has increased somewhat. Seoul also rose from 93.5 to 93.7.
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