Real estate transactions plunge 42.5% in November on credit restrictions

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Real estate transactions in South Korea fell nearly 43% year-on-year in November amid tight lending and rising interest rates, government data showed on Tuesday.

The number of homes that changed hands across the country stood at 67,159 in November, down 42.5 percent from the previous year, according to data from the Ministry of Land, Infrastructure and transports.

Compared with the previous month, the count for November was down 10.8%.

The number of real estate transactions in the greater Seoul area, which includes the western port city of Incheon and the adjacent province of Gyeonggi, fell 35.9%, while the rest of the country fell 46.1% .

November’s tumble came amid tighter restrictions on mortgages and a rise in lending rates following the central bank’s hike in the country’s benchmark interest rate.

In an effort to curb rising house prices and household debt, the government has made it more difficult for homebuyers to take out mortgages. In November, the Bank of Korea raised its seven-day repo rate by 0.25 percentage points to 1% to help control inflation and household debt.

The ministry, meanwhile, said the country’s new housing permits rose 24.2% year-on-year to 448,092 in the first 11 months of the year.

New building permits in the capital region increased by 18.7% and those in the rest of the country by 30.4%. Permits in Seoul soared 54.6%.

By type, building permits for new apartments jumped 28.4%, and permits for other housing types, such as townhouses and single-family homes, rose 12.8%.

The number of new home construction jobs rose 19.5 percent year-on-year to 501,878 units in the January-November period, according to the ministry. (Yonhap)


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