Homeowners Want to Sell, but No One Wants to Buy
By Lee Hyo-sik
Staff Reporter
Lee Se-joon, 39, who owns a 23-pyeong (76 square meters) apartment in Pyongchon, south of Seoul, called a couple of nearby real estate agencies several days ago to dispose of his unit.
He is thinking that now is the time to sell his apartment as the housing sector, which has remained depressed over the past two years, is now showing some signs of picking up, particularly in the affluent southern Seoul areas.
``Many experts are saying that the Korean economy has hit bottom. The stock market here has rallied over the past few months, one of few important signals that the worst is over. The ample liquidity as a result of a record-low interest rate has pushed up values of real estate and other assets. I think it is the best time to sell my apartment at a fair price after two years,'' Lee said.
After selling the holding, he plans to rent an apartment to slash his commute time by half and send his two children to better private learning institutes.
Like Lee, a growing number of homeowners are trying to sell homes on the back of a recent recovery in the housing market.
In a survey of 923 homeowners nationwide, conducted by online real estate information provider Doctor Apt., the index for home selling rose sharply to 57.1 from minus 20.2, three months ago.
The more people say they want to dispose of their holdings, the higher the index becomes. The finding indicates that a substantially large number of homeowners have become bullish about the housing market and that they can now receive higher prices for their holdings.
More people have become more willing to purchase houses, boosted by a series of deregulation measures in the property sector and record-low interest rates, making it easier for homeowners to sell.
According to Kookmin Bank, apartment prices have shown an upward curve this month, with many buying homes on expectations that asset prices will head north on an economic rebound and the low interest rate.
The Bank of Korea (BOK) slashed its key interest rate by 3.25 percentage points to an all-time low of 2 percent since October last year.
Also, more people are taking out mortgages to purchase houses. In February, mortgages recorded the biggest jump in more than two years as more people borrowed money to purchase homes, according to the central bank.
Housing loans increased by 3.32 trillion to 244.79 trillion won from the previous month and the amount is widely expected to go up further in the coming months.
However, an index for home buying plunged to 80.8 from 122 over the three-month period as home prices, particularly those of old units scheduled for reconstruction in southern Seoul, have increased sharply over the past month.
A manager at Doctor Apt. said an increasing number of homeowners want to dispose of their units but it has become unattractive for potential buyers because of the recent surge in home prices.