"80% of 'Severe Unsold Houses' Are in Provinces... Seoul Housing Transactions Increase for 3 Consecutive Months"

While the nationwide increase in unsold housing units has slowed, so-called 'malignant unsold housing'?unsold units after completion?has risen by 13% in just one month. Housing transaction volumes showed signs of recovery, particularly in Seoul, reflecting expectations of government deregulation.

83% of Unsold Housing Concentrated in Provinces... Sharp Increase in Unsold Units After Completion

"80% of 'Severe Unsold Houses' Are in Provinces... Seoul Housing Transactions Increase for 3 Consecutive Months"

View of downtown apartments and residential areas from Inwangsan Mountain in Seoul / Photo by Yonhap News

According to the 'February Housing Statistics' released by the Ministry of Land, Infrastructure and Transport on the 30th, the number of unsold housing units nationwide last month was 75,438, a 0.1% (79 units) increase from the previous month. Compared to the rise from 58,027 units in November last year to 68,148 units in December and 75,359 units in January this year, the rate of increase has slowed.

However, the number of unsold units after construction completion was 8,554, up 13.4% (1,008 units) from the previous month. This is the largest scale since July 2021 (8,558 units), with about 700 unsold units occurring in post-sale complexes in Daegu, causing a sharp rise in unsold units after completion.

Looking at unsold housing by region, 83% of the total is concentrated in the provinces. The metropolitan area had 12,541 units, and the provinces had 62,897 units. These represent a 2.3% (284 units) increase and a 0.3% (205 units) decrease, respectively, compared to the previous month. In the provinces, Daegu had the largest number of unsold units at 13,987, followed by Gyeongbuk (9,074 units) and Chungnam (8,546 units).

By size, unsold units over 85㎡ exclusive area decreased by 0.9% to 8,849 units, while those 85㎡ or less increased by 0.2% to 66,589 units.

Amid the spread of unsold housing concerns, housing supply is declining. The cumulative housing permit performance nationwide for January to February this year was 54,375 units, down 22.5% compared to the same period last year. The metropolitan area saw 19,497 units, down 24.9%, and the provinces had 34,878 units, down 21.0%. Among these, apartment permits were 47,072 units, a 17.4% decrease over the same period, while non-apartment housing permits sharply dropped by 44.3% to 7,303 units.

Construction start performance also declined, with a cumulative total of 31,955 units nationwide for January to February, down 28.0% from the previous year. The supply performance of multi-family housing was 10,945 units nationwide, a 75.3% decrease compared to one year ago. In contrast, completion performance increased by 9.8% to 50,486 units nationwide.

February Nationwide Unsold Housing Statistics / Image provided by the Ministry of Land, Infrastructure and Transport

Housing Transactions Increase by 50% in One Month... Seoul Sees Three Consecutive Months of Growth

Meanwhile, housing transaction volumes surged by more than 50% compared to the previous month, showing signs of recovery. The total number of housing transactions nationwide in February (based on reporting date) was 41,191, a 59.9% increase from the previous month. However, this is 4.6% lower compared to the same month last year.

The metropolitan area recorded 17,240 transactions, and the provinces 23,951, increasing by 67.4% and 54.9%, respectively, from the previous month. By housing type, apartment sales rose 75.6% to 31,337 units, while non-apartment housing sales increased by 24.4% to 9,854 units.

Monthly apartment transaction volumes in Seoul have increased for three consecutive months compared to the previous month. In November last year, the transaction volume was 761 units, marking the lowest point since related statistics began to be compiled, but it rose to 1,001 units in December, 1,161 units in January this year, and 2,286 units in February.

Lease and monthly rent transaction volumes are also on the rise. The combined February lease and monthly rent transaction volume (based on reporting date), including lease reporting system data and fixed-date reporting data, was 273,114, up 27.1% from the previous month and 13.4% higher than the same month last year.

By lease type, Jeonse (long-term deposit lease) transactions were 120,847 units, and monthly rent transactions were 152,267 units. The proportion of monthly rent increased from 54.6% in January to 55.2% in February.