The number of unsold dwellings in Incheon has more than doubled compared to a year ago, continuing the market slump. Recently, there have been concerns that the number of unsold dwellings will increase further due to numerous shortfalls in recent sales complexes.
According to statistics from the Ministry of Land, Infrastructure and Transport as of the end of November last year, the number of unsold dwellings in Incheon stood at 3,042 units, marking a 134.4% increase compared to the same period last year (1,298 units). The so-called malignant unsold units, or those unsold after completion, also rose to 1,544 units, a 149.4% increase compared to the previous year (619 units).
New sales complexes also struggled to attract interest. Last month, 'ePyeonhan Sesang Dongincheon Bayfront' attracted 240 applications for 429 units offered, resulting in a shortfall in most types. Similarly, 'Inha University Prugio Edufore,' which also held a subscription last month, received 401 applications for 548 units, leading to a shortfall.
Recent sales complexes appear likely to face shortfalls due to high sales prices. Park Ji-min, director of the Wollyong Subscription Research Institute, noted, "Since last year, sales prices have risen significantly, leading to good conditions for existing quasi-new complexes, but recent sales complexes are experiencing difficulties due to high prices. Especially, apart from some central Incheon areas, the locations of the developments in less favored regions seem to have affected the unsold units."
The slump in the Incheon real estate market is expected to continue until the first half of this year. The Housing Industry Research Institute reported that the Incheon Housing Business Outlook Index fell to 64.7 last month, a drop of 29.0 points from the previous month's 93.7. Incheon saw the largest decline among the 17 cities and provinces nationwide. The baseline for the national Housing Business Outlook Index is 100, indicating that a reading above this number means many housing-related businesses expect the market to improve, whereas a reading below indicates the opposite.
Experts pointed out that the supply in the Incheon area has been excessive amid reduced demand due to the recent market slump. Yoon Su-min, a real estate expert at NH Nonghyup Bank, stated, "Incheon has a significant amount of housing supply expected until this year, leading to a situation where unsold dwellings are inevitable. When unsold units accumulate and reach a peak, there tends to be some resolution, but it is still early to expect recovery in Incheon this year."
Park Won-gap, chief real estate expert at KB Financial Group, also commented, "Given that the current real estate market does not have strong upward momentum, only the demand for switching to higher-grade areas is rebounding, while the rest remain in a slump."
Amid this situation, the application for corporate rehabilitation by Shindonga Construction, along with the cancellation of the recruitment announcement for residents of 'Incheon Geomdan New Town Familier Ellip,' is expected to impact the market. The complex recorded 313 applications for 618 units in the first and second priority subscriptions last month, with an average competition ratio of 0.51 to 1, resulting in a shortfall in most types. Shindonga Construction faced a first-round default last month after failing to repay $6 million in bills due to ongoing unsold units at its establishments and submitted a corporate rehabilitation application to the Seoul Rehabilitation Court on the 6th.