Scheduled Sale of 12,572 Households Nationwide in February
More Than 40% Decrease Compared to February 2022
[Asia Economy Reporter Kim Min-young] Due to the cold spell in the housing sales market, the January sales performance amounted to only one-quarter of the planned volume. As concerns over unsold units grow amid the market contraction, local governments are adjusting the supply pace, and construction companies are postponing sales, focusing on redevelopment complexes in Seoul and large-scale complexes in provincial areas. With more than 10,000 households scheduled to be supplied nationwide this month, it remains uncertain whether the planned sales volume will translate into actual performance.
According to Zigbang on the 6th, the housing complexes scheduled for sale in January, surveyed in early last month, included 10 complexes with a total of 7,275 households, of which 5,806 were for general sale. However, a re-survey conducted this month showed that only 4 complexes actually held sales, totaling 1,569 households, resulting in a supply performance rate of 22%, with general sales at 1,461 households, a supply performance rate of 25%. This means only one out of four originally planned sales volumes was supplied.
The poor sales performance is due to local governments and construction companies adjusting the supply pace in consideration of the recently cooled housing sales market atmosphere. On the 30th of last month, Daegu City announced that it would strengthen building reviews and withhold approval for newly submitted housing construction projects. For already approved housing construction projects, the city plans to request project owners to adjust the sales timing to induce post-sales or convert them into rental housing.
Ham Young-jin, head of Zigbang Big Data Lab, said, "They have completely blocked housing project approvals until the market stabilizes due to the rapid increase in unsold units and the concentration of new move-in volumes."
Construction companies are also postponing sales. In Seoul, sales schedules are being delayed mainly for redevelopment complexes, and in provincial areas, for large-scale apartment complexes. Although the government lifted many regulations last January to guide a soft landing of the housing market, the combination of economic recession and high interest rates has made it impossible to guarantee success. According to the Ministry of Land, Infrastructure and Transport, as of the end of December last year, the nationwide unsold housing units totaled 68,107, an increase of 17.1% (10,080 units) compared to the previous month (end of November). The metropolitan area saw a 6.4% (662 units) increase, while provincial areas increased by 19.8% (9,418 units), indicating that unsold units are more severe in provincial areas.
Due to the contraction in subscription demand, the planned sales volume for this month has also decreased to about half of last year's level, and it is uncertain whether even this volume will be properly absorbed by the market. According to Zigbang, this month there are 16 complexes preparing to sell a total of 12,572 households, of which 9,924 are for general sale. Compared to the same month last year, the total number of households is expected to decrease by 8,922 (42%), and general sales by 8,359 households (46%).
Lab head Ham said, "As unsold units accumulate and the housing sales market situation is unfavorable, it is uncertain whether the planned sales volume for February will also translate into actual performance."
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