[Asia Economy Reporter Jo Gang-wook] This year, the nationwide officetel supply volume is estimated to be about 36,000 units, the lowest in 12 years.
According to real estate data from R114 on the 23rd, the officetel supply and planned volume for 2022 is approximately 36,422 units, the smallest amount in 12 years since 14,762 units in 2010. By region, the distribution is △Gyeonggi 12,124 units, △Busan 5,000 units, △Seoul 4,387 units, and △Incheon 3,614 units.
Looking at the annual supply trend, about 100,000 units were supplied in 2017, the highest in the past 10 years, but the volume has steadily decreased since then, with about 49,411 units supplied in 2020. It recovered to about 56,700 units last year but is expected to decrease again this year by approximately 36%. This is the highest annual decline rate since 2010.
Officetel transaction volume is also increasing. According to data from the Korea Real Estate Board, transaction volume increased from 2017 to 2018, showed a temporary decline in 2019, and rose again in 2020. Over the following two years until 2021, it increased by a total of 10%, reaching 165,033 transactions.
Competition for officetel subscriptions in 2022 is also fierce. According to Subscription Home, a total of 15 officetel complexes received subscription applications in the first quarter of this year. Examining the subscription competition rate, 53,752 applications were submitted for 5,232 units, resulting in an average ratio of 10.27 to 1. Compared to 24,337 applications in the first quarter of 2021, the number of applications increased by nearly 30,000, and the subscription competition rate rose about 2.3 times from 4.49 to 1.
As the supply volume decreases, the scarcity value increases, attracting many people to apply. Officetels have the advantage of a relatively low entry barrier. No subscription savings account is required, and anyone aged 19 or older can apply regardless of home ownership status, which has increased interest among relatively younger generations who are disadvantaged in the point-based system.
An industry official said, "With the new government inauguration approaching, expectations for real estate regulation easing are reviving the previously frozen real estate market atmosphere," adding, "Until now, officetels used for office purposes were excluded from the total housing count, but recently, the Presidential Transition Committee is reportedly considering excluding them from the housing count under certain criteria. Therefore, competition in this year's officetel market, where supply volume has decreased, is expected to become more intense."
Meanwhile, about 4,920 officetel units are scheduled for supply nationwide next month.
Hanyang plans to supply the ‘Anyang Hanyang Sujain Riverview’ officetel at 198-69 Anyang-dong, Manan-gu, Anyang-si, Gyeonggi Province, right in front of Anyangcheon, in May. This complex consists of two buildings from three basement floors to 19 above-ground floors, with 169 units of 55㎡ exclusive area. Apartment-level space design such as showroom-type dressing rooms and pantry spaces targeting the 20s to 40s generation will be applied. Additionally, built-in refrigerators and freezers, a 3-burner hybrid cooktop, system air conditioners, washing machines, dryers, and underground household storage are all provided as standard to enhance residential convenience.
Also in May, ‘Siheung CN Pearl Wellplex’ constructed by Eunseong Industry Co., Ltd. and Eunseong Construction Co., Ltd. will be supplied in the area around 2197 Jeongwang-dong, Siheung-si, Gyeonggi Province. This complex will include 48 officetel units ranging from 35 to 56㎡ exclusive area, as well as offices and commercial facilities.
In the same month, KR Industry (Gyeryong Group) will supply 160 residential-type officetel units called ‘Jukdong Lishu Ville Casafore’ in the Daejeon area, and DL E&C (DL E&C) will supply 592 units of ‘e-Pyeonhansesang City Hangdong Marina’ in Jung-gu, Incheon.
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