"Can't Buy 20~30 Pyeong Apartments Even If You Want To"…Supply Down 250,000 Units

Exclusive 60~85㎡ Apartments, 250,000 Units Decrease in Supply Over 5 Years
"Small to Medium Apartments Popular for Cost-Effectiveness but Supply Declines"

The supply of small to medium-sized apartments (exclusive area 60~85㎡) has decreased by more than 250,000 units over the past five years. While supply has decreased, demand has surged, leading to an expected long-term supply shortage.

According to Real Estate R114, the number of small to medium-sized apartments supplied over the past five years (2019?2023) was 708,747 units. This is only 73% of the 959,848 units supplied in the previous five years (2014?2018).

Apartment complex in Jeonnong-dong, Dongdaemun-gu, Seoul. Photo by Hyunmin Kim kimhyun81@

The overall supply of apartments has also declined. During the same period, the nationwide apartment supply decreased from 1,310,206 units to 1,022,948 units, a total reduction of 287,258 units. Of this, the decrease in small to medium-sized apartments accounts for 87% of the total.

Although the supply of small to medium-sized apartments has decreased, they remain popular in the market. According to data from the Korea Real Estate Board, small to medium-sized apartments accounted for 45% of total sales volume over the past five years since 2019.

Demand for small to medium-sized apartments is expected to increase further. In March, the subscription system was revised, increasing the chances of winning for newlyweds and young people who prefer small to medium-sized apartments. The government revised the subscription system by introducing special and priority supply for newborns and allowing individual applications by spouses, thereby increasing the chances of winning for households with newborns and newlyweds.

Trends in the supply volume of small and medium-sized apartment sales. [Source: Real Estate R114]

Kwon Il, Research Team Leader at Real Estate Info, said, "Small to medium-sized apartments are popular for their cost-effectiveness, but as supply decreases, they are becoming increasingly difficult to find in the pre-sale market. In redevelopment projects, small to medium-sized types are mainly taken by union members, and in development projects, dividing the area into smaller units for sale as small apartments is more profitable."

In this situation, attention is focused on the upcoming supply of small to medium-sized apartments. In Seongnae-dong, Gangdong-gu, Seoul, ‘Grants River Park’ developed through the Seongnae 5 District redevelopment project will be supplied. It consists of a total of 407 units with a maximum of 42 floors above ground, of which 327 units will be offered for general sale. In Namdong, Cheoin-gu, Yongin-si, Gyeonggi Province, ‘Yongin Prugio One Cluster’ is planned for supply. Among the total of about 3,700 units, 1,681 units in Complex 1 will be supplied first. The complex consists of three types of 84㎡ units, as well as 59㎡ (A·B) and 130㎡ types.