Macro and Politics

* Housing sales increased by 80.6% m/m and 19.8% y/y in December, reaching 254,777 units. As a result, total housing sales in 2025 amounted to 1,688,910 units, representing a 14.3% increase compared to the previous year. Mortgage-backed sales rose by 35.6% m/m and 25.2% y/y in December to 29,149 units. On an annual basis, mortgage-backed housing sales surged by 49.3% y/y in 2025, reaching 236,680 units. Accordingly, the share of mortgage-backed transactions in total housing sales stood at 11.4% in December and 14% for 2025 as a whole. Turning to mortgage rates, the average housing loan rate, which averaged 42.79% in 2024, declined modestly to around 40% in 2025. Although the decline in mortgage rates was relatively modest, it nonetheless supported the pronounced increase in mortgage-backed sales and emerged as an important component of the broader recovery in housing sales over the year. In addition, we assess that expectations that the anticipated decline in interest rates would be reflected more rapidly in housing prices have also supported mortgage-backed demand, despite elevated borrowing costs. Meanwhile, housing sales to foreigners declined by 9.4% y/y in 2025 to 21,534 units, accounting for only 1.3% of total housing sales during the year. Overall, the recovery in housing sales in 2025 appears to have been driven predominantly by domestic demand and mortgage-backed transactions, while foreign demand remained a limited contributor.