This year's supply of privately built apartments is expected to hit the lowest level in 15 years since 2010.
According to Real Estate R114 on the 24th, this year's supply of privately built apartments (based on general pre-sales, including scheduled pre-sales) was tallied at 121,120 units. This is the smallest figure since 68,396 units in 2010. Compared with 2024 (156,898 units), it fell 22.8%.
Compared with the 358,712 units in 2015, when the supply of privately built apartments hit a record high, this year's pre-sale supply is down about 66.2%.
The decline in pre-sale supply is largely attributed to increased funding burdens on builders, including higher prices for imported raw materials. A sharp rise in the exchange rate has pushed up prices of key materials such as rebar and cement, and with multiple factors such as higher labor costs overlapping, some business sites have moved to adjust and scale back pre-sale schedules.
According to the Korea Institute of Civil Engineering and Building Technology (KICT), the construction cost index in October this year (preliminary) hit a record high of 131.74. The exchange rate also rose from the 1,360-won range in Jun. this year to the 1,470-won range recently, increasing about 10% in the second half alone.
As construction cost pressures intensify and new pre-sales contract, concerns are growing about a decline in future move-in volume. Considering that move-ins generally occur 2 to 3 years after the pre-sale point, the current reduction in pre-sale volume is highly likely to lead, with a lag, to a sharp drop in move-in volume.
Real Estate R114 projected that next year's scheduled move-in volume will be 183,256 units and will edge up to 191,827 units in 2027. However, it expects a decline to 146,211 units in 2028 and 66,724 units in 2029.