#Hyundai E&C has not yet mentioned the move-in schedule for 'Isu Station Hillstate Central,' which is scheduled for sale this month, on its official website. Existing members have signed a contract that states a move-in date of March 2028. Hyundai E&C is reviewing the move-in schedule to be released when general sale announcements are made. An official from Hyundai E&C noted that 'if strikes occur due to the implementation of the Yellow Envelope Law, there is a possibility of major process disruptions and delays across all business sites.'
#Daewoo E&C, which is preparing for the sale of 'Mangpo Station Prugio Mark' in Suwon this month, has set the move-in date for February 2030. Having started construction last month, it effectively secures a total construction period of 4 years and 6 months. Considering that the construction period for other redevelopment projects is approximately 3 years, this is relatively long. An official from Daewoo E&C's housing division said, 'We have set the timeline considering the difficulty of the construction methods and various factors due to climate change,' adding that 'we will review the impact of the Yellow Envelope Law as detailed rules are established later.'
The calculations that construction firms must consider when determining move-in dates ahead of apartment sales are becoming increasingly complex. They have already had to account for rising construction costs, material procurement challenges, and changes in financing conditions, but now the frequent strikes by subcontractors have also become a new variable. The 'Yellow Envelope Law' (amendments to Articles 2 and 3 of the Labor Union Act), which includes management decisions affecting working conditions as a subject of disputes, is set to take effect next year.
According to the construction industry on the 5th, movements are being detected among construction firms to delay move-in dates ahead of the implementation of the Yellow Envelope Law. They intend to proactively postpone move-in dates through negotiations with unions, especially in business sites that have not yet started sales. While contracts with union members may be inescapable, they intend to reflect the delayed move-in dates in contracts with general sale winners.
The construction industry predicts a significant likelihood that construction periods will extend with the implementation of the Yellow Envelope Law. The law is centered on safeguarding workers' rights to strike and preventing the suppression of union activities. It also allows subcontractor workers to negotiate with primary companies. The entire industrial sector is expressing concerns over potential economic losses due to excessive strikes. In particular, construction firms building apartments, which involve numerous subcontractors in ready-mixed concrete, electricity, facilities, and interior work, fear that the construction periods will lengthen and costs will rise due to strikes.
An official from a mid-sized construction firm said, 'In light of recent increases in site safety regulations being enforced, and with strikes from unions occurring as well, delays are inevitable.' They added, 'There is great concern that this could lead to a decline in business viability and competitiveness.'
The unions preparing for general sales are also facing significant challenges. They need to expedite general sales to maintain the pace of business, but if move-in dates are ultimately delayed, it would result in considerable losses, such as increased contributions for union members. An official from a reconstruction union in Seoul expressed, 'There have already been delays in projects due to various real estate regulations and financing conditions, but now we have to contend with government labor policies as well. We have no choice but to accept adjustments to the move-in timeline from the perspective of preparing for uncertainties, which is frustrating.'
Concerns are being raised in the market that the supply through private redevelopment projects may be delayed. The current government is accelerating housing supply primarily through public initiatives, but it is pointed out that private supply might move in the opposite direction. With projections indicating that house prices may rise due to a 'supply cliff,' the implementation of the Yellow Envelope Law could potentially slow down private supply. In the second half of this year, only 18,982 housing units are expected to be occupied in Seoul. For next year, 28,885 units are expected to occupy throughout the year, and the year after that, 10,417 units will be occupied.
Nam Hyuk-woo, a researcher at the WM Sales Strategy Department of Woori Bank, remarked, 'Even if manpower issues in redevelopment projects are resolved smoothly, there are too many variables involved.' He added, 'Due to policy risks, supply is being delayed, and as new constructions decrease, the possibility of a repeating cycle of rising prices in reconstruction and redevelopment apartments is increasing.'