SUMMARY ․ 211
SUMMARY
A Study on Housing Supply and Stock Management for Stabilization of Real Estate Market( Ⅰ)
: Focusing on Strategies for Inducing Housing Supply in Response to Housing Demand by Region
Byeon Sehil, Park Chungyu, Oh Minjoon, Jeong Gyeongseok, Cho Junghee, Kwon Geonwoo, Jeon Sungje, Lee Yunsang, Bang Boram
Key words: Housing Supply, Housing Demand, Housing Market Management, Spatial Econometrics Model, Housing Information System
In recent years, demand for new housing has declined in the mid- to long-term due to changes in housing supply-demand conditions, such as the housing supply rate of over 100%, the slowdown in economic, population, and household growth and so on. However, in the period of rising housing prices, construction companies increase apartments supply to maximize their profits, and when house prices fall, they reduces the supply of housing. For this reason, the negative impact on housing market is repeated periodically due to the supply and demand gap.
This study begins with the intention to draw policy measures to induce supply of new housing to meet regional demand in order to minimize the fluctuation of market price in mid- and long - term due to the supply and demand gap in
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new housing market. For this purpose, we firstly examined the causes and market impacts of the inconsistency in supply and demand in each region.
Secondly, we examined the empirical models to analyze the determinants of the subscription competition rate and the determinants of the unsold housing rate and performed an empirical analysis of case study areas such as Seoul metropolitan area and Youngnam area. Finally, we present policy measures to induce supply of new housing to meet regional demand, synthesizing the results of the empirical analysis as well as domestic and overseas case studies, expert consultation, and individual in-depth interviews(IDI) with construction companies and so on.
The main results of this study are as follows. First, the government and municipalities need to pay particular attention to the control of apartment building permits since the proportion of apartments in new homes is high and problem of inconsistencies is serious in the supply and demand of apartments.
Second, in Korea, it is necessary to strengthen market monitoring by using supply - demand related indicators, to diagnose and assess housing markets regularly, to strengthen demand identification, to secure stable land, and to strengthen the public role. Third, as a result of analyzing the subscription competitiveness and determinants of unsold housing, which are the result of the inconsistency of apartment supply and demand, using the spatial econometrics model, the number of households, the location, the sale price per square meter, the household loan interest rate are statistically significant.
Therefore, it is important for municipalities to take into account the amount of housing supply to stably manage and consider complex conditions in each region when they give apartment building permits. In addition, the central government needs to regulate subscription competition and unsold housing units through designation of high-priced housing management areas, pre-sale
SUMMARY ․ 213 price control, and designation of unsold housing units through Housing and Urban Guarantee Corporation (HUG). In addition, it is important to maintain the soundness of the housing market through financial policies, and it is also necessary to consider policies to enhance the stability of local industries to reduce unsold housing units. In addition, the scope of investigation and publication should be expanded the survey of consumer psychology in housing market by Korea Research Institution of Human Settlements (KRIHS).
Furthermore, in addition to price and trading volume indicators, it is necessary to monitor consumer psychology and regional economic conditions before introducing customized policies in the region.
The following policy measures could be drawn. First, there is a need to strengthen market monitoring by using indicators to diagnose the situation of local housing market and to provide integrated information easily to both suppliers and consumers. To this end, it is necessary to develop a monitoring system that can provide comprehensive information on the local real estate market indicators. It is also necessary to provide the indicators through the dashboard approach like Royal Bank of Canada case and to provide the criteria for the local real estate market situation.
Second, there is a need to periodically provide local housing market assessment results to support consumer decision making by region. It is necessary to assess the real estate market objectively based on the diagnosis and forecast of housing market conditions before policy implementation.
Third, it is necessary to strengthen the verification of the legal requirements in the process of housing supply so that irregular fluctuations of the market will not be continued due to periodic supply-demand gap. Since there is no verification process for the demand for housing, the central government and municipal governments should supplement the relevant system in order to
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strengthen the demand verification in the laws related to housing supply. And then, it is necessary to add information to strengthen the related regulations such as the Korea Land and Housing Corporation Act, the Korea Appraisal Board Act, the Housing and Urban Guarantee Corporation Act, and the Korea Housing Finance Corporation Act and so on.
Fourth, in order to minimize the problem of inconsistency in housing supply and demand, it is important to secure the land for housing stably on a medium- and long-term basis and it is necessary to strengthen the role of the public sector through sharing roles with the private sector. In view of the supply and demand condition and circular phase in the local housing market, it is important to secure the land for public housing in advance.
Fifth, it is necessary to operate flexible and stable financial policies in accordance with housing market condition. With the distinctive regional changes in the housing market, there is a limit to operating one-sided financial policies.
Therefore, countermeasures against housing finance should be taken along with measures such as flexible regulations appropriate to the situation by region.