Impact of U.S. Interest Rates on Korean Economy and Housing

Korean interest rates may soon decrease due to economic struggles and rising household debt.

### The Impact of High U.S. Interest Rates on Korea
The U.S. has entered a **new era of high interest rates**, raising questions about whether Korean interest rates will follow suit. Wealthy individuals prioritize **interest rates** in their financial decisions, and the movement of money plays a significant role in **housing price fluctuations**. The Bank of Korea's monetary policy decisions are influenced by various factors, including the **struggling domestic economy**, approaching **target inflation**, and the need to address **real estate project financing** and the **debt issues faced by self-employed individuals**.

### Concerns About Interest Rate Cuts and Household Debt
Household debt is rising, and there are worries that **lower interest rates could exacerbate the problem and drive up housing prices**. The Bank of Korea's role is to **manage interest rates and stimulate the economy**, while other government bodies should **address housing supply and financial regulations**. The likelihood of an **interest rate increase in October is high**, and the asset market currently shows **positive factors from multiple angles**.

### Positive Trends in Seoul's Real Estate Market
Seoul's nine districts have rebounded positively since September, indicating a **potential continuation of this trend**. Macroeconomic analysis suggests a **stable housing market** with slight fluctuations during the pivot period, as money flows into both stock and real estate markets. The auction sale market's **upward trajectory** and the accumulation of construction permits indicate a **predicted housing supply shortage** starting in 2024, with a **decreasing success rate for permits** turning into actual housing supply.

### Final Demand Analysis in Real Estate
The analysis focuses on two key factors for demand: **purchasing power** and **willingness to buy**, which are multiplicative. The Housing Price Outlook CSI indicates a **strong belief in rising house prices**, potentially increasing willingness to buy. Falling interest rates can increase loan limits and decrease borrowing costs, thereby **enhancing purchasing power** and **alleviating the impact of loan limit restrictions**.

### The Complexities of Searching for a House
The speaker is actively looking for a house, feeling the pressure of **rising housing prices and loan limits**. The stress DSR's implementation has led to a **surge in credit loans**, creating a **balloon effect and escalating private finance**. Despite rising costs and economic factors, the speaker predicts that housing prices will **continue to rise**, emphasizing their role in **forecasting average sale prices** rather than giving direct investment advice.

### Investing Insights from Professor Kim Geon-seok
Professor Kim Geon-seok is providing an intensive tutorial on the economy and asset market, offering guidance for **investment decisions**. The new book, "**The Era of Power: Economic Outlook 2025**," is recommended for everyone, as understanding the economy is **crucial for making informed decisions**. The importance of **assessing the macroeconomic landscape** and making **comprehensive judgments** is emphasized for successful investing.

### Interest Rate Dynamics and Economic Implications for Korea
* 📈 The U.S. has entered a **new era of high interest rates**, prompting questions about whether Korean interest rates will follow suit, which necessitates **careful study**.
* 💼 Wealthy individuals attending VVIP seminars prioritize inquiries about **interest rates**, reflecting their **significant influence on financial decisions**, especially among high-net-worth individuals with over **500 billion won in assets**.
* 🏡 A recurring question among these individuals is how housing prices can rise despite a struggling economy and stagnant incomes, indicating that **money is simply shifting among buyers**.
* 💡 The Bank of Korea's monetary policy decisions are influenced by various factors, including the need to **balance the interests of savers wanting higher rates** against **borrowers seeking lower rates**.
* 📉 Current economic conditions suggest a need for lowering interest rates, as the Korean economy is **struggling** and inflation is **nearing the target level of around 2%**.
* ⚠ However, concerns remain regarding the **widening interest rate gap** with the U.S., increasing household debt, and the potential for **surging housing prices** if rates are cut.
* 🏠 The Bank of Korea's role is to **manage interest rates**, while other governmental bodies must address real estate regulations and financial practices to **mitigate risks associated with debt and housing market fluctuations**.
* 📚 Finally, readers are encouraged to explore the new book, "**The Era of Power: Economic Outlook 2025**," to gain a broader understanding of the economic landscape and its implications for **investment decisions**.

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