South Korea's KOSPI Real Estate Index Rises 1.94% to 870.74 on July 24 Amid ETF Rebalancing Pressures

According to Yonhapinfomax, South Korea's KOSPI Real Estate Index rose to 870.74 on July 24, up 1.94% for the month, with a market capitalization of 8.6 trillion Korean won. However, the recovery remained modest compared to prior declines—the index fell 15.44% in May and 5.09% in June, eroding total market value from above 10 trillion won.

Thin trading volumes have amplified the impact of exchange-traded fund (ETF) rebalancing on individual REITs. According to Shinwoosung Securities, three REITs reduced their exposure in the TIGER Real Estate and Infrastructure ETF during June saw sharp declines: KB Star REIT dropped 8.57%, D&D Platform REIT fell 16.73%, and IReit CoCo Crep fell 17.07%. Analysts note that low liquidity allows rebalancing outflows to drive 10% or greater price swings. Rising interest rates have also intensified focus on refinancing risk, as increased borrowing costs may erode dividend capacity for leveraged REITs.