The national apartment move-in outlook index has declined, but the metropolitan area, particularly Seoul, has experienced a significant increase, highlighting a stark regional disparity. Demand for mid-range apartments in the outskirts of Seoul and southern Gyeonggi Province has expanded, leading to heightened expectations for move-in conditions for newly constructed apartments in the metropolitan area.
On October 15, the Korea Housing Industry Institute (KHI) reported that the national apartment move-in outlook index fell to 82.6, a decrease of 5.0 points from the previous month.
The move-in outlook index reflects housing developers' expectations regarding whether buyers will be able to pay the final balance and move in as scheduled. A score below 100 indicates a negative outlook for the move-in market, while a score above 100 suggests a positive outlook.
Regionally, the metropolitan area’s move-in outlook index rose to 98.2, up 17.2 points from the previous month’s 81.0. Seoul recorded a 17.7-point increase to 108.3, surpassing the baseline of 100. Incheon saw a rise of 23.9 points to 89.2, while Gyeonggi Province increased by 10.2 points to 97.2.
KHI noted, "The upward trend is spreading, particularly in mid-range complexes in the outskirts of Seoul and southern Gyeonggi, driven by a shift in demand due to a shortage of rental properties. The base effect from a 18.5-point drop in Incheon last month also contributed to this increase."
In contrast, the outlook for regional areas has generally worsened. The outlook index for metropolitan cities dropped by 6.3 points to 86.6. Gwangju experienced the largest decline, falling 18.9 points from 107.1 to 88.2. Busan decreased from 80.0 to 68.4, a drop of 11.6 points, while Daejeon (85.7 to 81.2) and Daegu (85.0 to 81.8) fell by 4.5 points and 3.2 points, respectively. Ulsan and Sejong remained unchanged at 100.0.
The outlook index for provincial areas dropped by 12.1 points to 73.9. Gyeongnam fell from 100.0 to 80.0, a decrease of 20.0 points, while Jeonbuk (100.0 to 81.8), Chungnam (91.6 to 76.9), Gyeongbuk (91.6 to 78.5), and Chungbuk (85.7 to 75.0) also recorded double-digit declines. Jeju (66.6 to 56.2), Gangwon (75.0 to 70.0), and Jeonnam (77.7 to 72.7) also saw decreases.
Meanwhile, the actual move-in rate for apartments nationwide last month was 68.2%, an increase of 8.7 percentage points from August. The move-in rate in the metropolitan area fell by 1.0 percentage point from 80.8% to 79.8%, while the four major metropolitan cities and Gwangju and Sejong rose from 55.5% to 60.8%, an increase of 5.3 percentage points. Other regions also saw a rise from 51.6% to 69.4%, a jump of 17.8 percentage points.
The primary reason for non-move-ins was the lack of final loan approval, accounting for 37.0%. This was followed by delays in selling existing homes (31.5%), failure to secure tenants (14.8%), and delays in selling pre-sale rights (5.6%).
KHI stated, "The notable increase in move-in rates in non-metropolitan areas is likely due to a decrease in move-in supply in September. However, it is difficult to view this as an improvement in the conditions for securing funds or selling existing homes. Given the ongoing trend of lending restrictions and the concentration of demand in the metropolitan area, we expect an increase in move-in supply in October, necessitating a close examination of move-in conditions in regions with concentrated supply."
* This article has been translated by AI.
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