While existing studies mainly focus on the relationship between housing prices and macroeconomic variables, they pay little attention to how identical market variables generate different adjustment mechanisms across regional housing markets. This study examines regional differences in housing price adjustment patterns under recent structural changes such as rising interest rates and accumulated housing supply. Specifically, it compares the housing price adjustment structures of apartment markets in Seoul, Daegu, and Gwangju. Using monthly data from January 2007 to November 2025, the analysis draws on real apartment sale prices, unsold housing units, housing transaction volumes, and real mortgage interest rates. An autoregressive distributed lag bounds testing approach is employed to examine long-run cointegration relationships, and the Toda- Yamamoto Granger causality test is applied to identify short-run causal relationships. The results show no long-run cointegration relationship in Seoul, but a clear long-run relationship in Daegu. In Gwangju, the cointegration results are inconclusive. Short-run causality analysis indicates that transaction volume Granger causes housing prices in all three regions, whereas unsold housing does not significantly explain short-run price movements. Meanwhile, the influence of interest rates differs by region, with significant effects observed only in Daegu. Overall, the findings suggest that housing prices in Seoul and Gwangju are closely associated with short-term demand shocks reflected in transaction activities, whereas those in Daegu exhibit a more complex adjustment pattern involving both long-run equilibrium relationships and short-run dynamics. These results highlight the importance of considering regional market structures in housing policy design.
Han et al. (Wed,) studied this question.