Prospective Pre-Subscription Applicants' Biggest Concern: "Interest Burden Due to Interest Rate Hikes"

[Asia Economy Reporter Minyoung Kim] For prospective apartment applicants planning to apply in the second half of the year, the rise in the base interest rate has emerged as the biggest concern.

According to a survey conducted by Zigbang on 1,324 users of its application, 988 respondents said they plan to apply for an apartment in the second half of the year. When asked what their biggest current concern was, 39.1% of the 988 respondents cited "increased interest burden due to interest rate hikes." This was followed by △low winning probability due to low subscription points and high competition (35.4%) △concerns about price increases due to the revision of the price ceiling system (12.9%) △lack of supply complexes in areas of interest (6.1%), in that order.

By age group, those in their 40s and older most frequently selected "increased interest burden due to interest rate hikes" (40.4%) as their biggest concern when applying, whereas respondents in their 20s and 30s chose "low winning probability due to low subscription points and high competition" (43.5%). This result is analyzed to be due to the relatively higher number of single-person households and shorter subscription account holding periods among those in their 20s and 30s.

When asked whether they had changed their application plans this year due to the implementation of the revised price ceiling system and interest rate hikes, 38.9% of all respondents answered that they were "considering changing the type of application, such as private, public, or rental." This was followed by △no change or impact on plans (24.5%) △considering changing the region (12.0%) △considering reducing funds (11.5%) △considering reducing area (11.3%), in that order.

The preferred application area was "exclusive use area over 60㎡ up to 85㎡" at 42.6%, the highest proportion. This was followed by △exclusive use area over 85㎡ up to 102㎡ (32.1%) △exclusive use area 60㎡ or less (12.1%) △exclusive use area over 102㎡ up to 135㎡ (10.1%) △exclusive use area over 135㎡ (3.0%).

Among the respondents who participated in the survey, 305 answered that they have no plans to apply this year. When asked the reason, "low probability of winning an apartment application" was the most common at 31.1%.

Ham Young-jin, head of Zigbang Big Data Lab, said, "The interest rate hike is becoming the biggest concern for prospective applicants as it leads to increased interest burdens," adding, "Prospective applicants should continuously monitor application information supplied in their areas of interest, carefully assess their financial capacity, and approach the process without overextending themselves."