In the first quarter of this year, the supply of apartments in Seoul has fallen to around 1,000 units, representing a 74% decrease compared to last year. The increase in political uncertainty due to the impeachment and early presidential election, coupled with rising construction costs, has led construction companies to postpone their sales schedules.
According to a report by Woori Bank's Wealth Management Sales Strategy Department, analyzing data from Real Estate 114, the supply of apartments in Seoul recorded 1,097 units from January to March this year. It is expected that 30,441 units will be supplied in Seoul this year, indicating that only 3.6% of the planned supply has been achieved.
The supply of apartments in Gyeonggi Province and Incheon has also significantly decreased compared to last year. In the first quarter of this year, Gyeonggi Province offered 3,493 units, while Incheon provided 252 units. Compared to last year, this represents a decrease of 57% for Gyeonggi and 95% for Incheon.
Gyeonggi Province has only achieved a 4.6% supply from the planned 75,552 units for this year as of the first quarter. Incheon, with a planned supply of 16,682 units, also achieved a supply rate of only 1.5% in the first quarter.
Nationally, 20,703 units were supplied in the first quarter, a 70% decrease compared to last year. The achievement rate for this year's national supply target of 194,253 units stands at 10.7%.
According to the real estate industry, projects that were expected to begin sales in the first half of this year in the Seoul area, such as 'The Parkside Seoul,' 'Banpo The H Class,' and 'Jamsil LEEL,' are projected to have their sales schedules pushed to the second half of the year.
Although spring is generally considered the peak season for apartment sales, real estate experts analyzed that construction companies are not proceeding with sales due to the ongoing political situation surrounding the impeachment and early presidential election from the end of last year into the first half of this year.
Ham Young-jin, head of Woori Bank's Real Estate Research Lab, noted, 'In the first quarter of this year, the impeachment situation continued, and the rise in construction costs has essentially left construction companies in a state of inactive development. It is expected that the supply issue will ease starting in the second half of this year after the presidential election in June.'
A real estate industry official remarked, 'During the presidential election period, online and offline advertisements cannot be actively promoted due to the election, which is causing construction companies to aim to launch their sales after the election concludes.'