South Korea house prices snap 13 months of decline

SOUTH Korea’s house prices rose slightly in July after 13 months of decline, data showed on Wednesday (Aug 16), with the rise led by demand for preferred residential complexes in the capital area.

Korea Real Estate Board’s nationwide house transaction price index rose 0.03 per cent in July, after a 0.05 per cent fall in June, and posted its first monthly rise since May 2022.

By region, home prices in the capital city of Seoul rose 0.15 per cent and those in the greater capital area also climbed 0.15 per cent, while the decline in other areas softened to 0.09 per cent from 0.13 per cent the month before.

House prices rose at a faster pace in Seoul amid expectations for a recovery, while prices continued a rising trend in the greater area as urgent sales were cleared off, the board said in a statement.

“The market is unlikely to fall back sharply again, as there is demand at low prices, but at the same time, it is hard to take it as a signal for a rebound or entry into another bullish market,” said Kang Min-seok, head of real estate research at KB Financial Group.

Earlier this year, the government eased financial regulations on homebuyers and introduced a temporary policy mortgage loan in efforts to achieve a soft landing for the falling market.

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Together with rising home prices, South Korea’s household debt increased for a fourth straight month in July and by the biggest amount in almost two years, separate data showed last week, raising policymakers’ worries about financial imbalances.