(Bloomberg) -- South Korean consumers’ confidence in the country’s housing-market rally weakened for the first time since the start of the year, underscoring the impact of government steps that helped cool the real estate market and pave the way for a central bank pivot.
An index indicating the one-year outlook for home prices slipped to 116 this month from 119 in September, the Bank of Korea said Wednesday. The index reflects a survey that took place between Oct. 8 and 16, a period during which the BOK cut its benchmark interest rate to 3.25%.
The central bank cited a slowdown in the growth of home prices in Seoul when it finally decided to pivot and cut rates. The BOK had extended its record-long holding pattern due to concerns about adding fuel to a housing market it saw as overheating. In August those concerns prompted the government to step in with measures to tighten lending rules and increase home supply.
The BOK is widely expected to hold its rate unchanged when it meets next month. Governor Rhee Chang-yong said the board would continue to keep an eye on the property market as they set the pace of further easing.
The overall consumer sentiment index rose to 101.7, rising from the threshold of 100 that divides optimism and pessimism. The outlook for interest-rate levels in the next six months fell to 88, the lowest point since mid-2020, the BOK data showed.
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