The Korean government imposes strict regulations, curbing the high prices of housing in the country. Despite this regulation, real estate remains an attractive investment in South Korea.
So, what do real estate experts say about the real estate status of Korea in 2019? How about the forecast for 2020? Will there be an improvement or decline? You’ll learn the situation in Korea today, and the coming years in this Stratford Management Inc review real estate.
Real Estate in Korea Is Still an Attractive Investment
In a recent Mail Business Newspaper survey, real estate experts where asked about their insights and forecast with the price regulations for new private apartments.
Here are the findings of the said survey:
- About 46 percent of the respondents expect housing prices to increase next year
- Only 20 percent expect a decline in the costs next year
- The remaining 34 percent of the respondents say that the prices will stay at its current level
- The decline in projected prices will be no more than five percent
- About 16 percent of the respondents say that the country is now at its peak of the housing market’s downward cycle, and 32 percent said that Seoul is at the beginning of this cycle
Real Estate Expert Recommendations
September last year, the government announced to the public that they would fully implement strong property regulations. They are now implementing price caps on newly built private apartments in Gyeonggi Province and Seoul. However, despite the price cap announcement, the apartment prices still went up to 0.02 percent in the second week of August.
The survey showed that most of the interviewed real estate experts who say that Seoul’s housing market will tend to decline this yeat. That’s why the majority of the respondents, around 60 percent, recommended investors to buy residential properties by the end of 2019.
Commercial Real Estate Status in Korea
In 2019, the expected commercial real estate volume in Korea transaction declined marginally because of many reasons. However, despite these reasons, real estate experts still believe that the commercial real estate status of Korea this year is favorable. The demand remains for investment properties in Korea, making the country a great example of a robust real estate economy.
Here are some of the reasons why the status of commercial real estate in Korea was perceived to decline this year:
- Higher Borrowing Costs – Because of high borrowing costs, like mortgage fees, commercial lending requires scale, size, and strong industry relationships
- Lower Returns – It is due to tighter property regulations
- Lacking Core Properties – Some real estate experts expect this decline because of the lack of core commercial properties for sale, like office buildings, hotels, and shopping centers
South Korea still has an impressive real estate status despite the regulations and strict property laws. It just goes to show that many people find the housing market in the country competitive and worth the investment. The demand for housing and other property investments in Korea is barely affected by price caps and changes in real estate rules and regulations.