"The Power of Liquidity Stronger Than Regulation"...Last Year's Housing Transactions Surpass 300 Trillion for the First Time Ever

The Largest Amount Since the Government Began Statistical Compilation in 2006
Impact of Interest Rate Cuts and Panic Buying Following the Spread of COVID-19

Seoul apartment view from Namsan [Image source=Yonhap News]

[Asia Economy Reporter Onyu Lim] Last year, the total amount of housing sales transactions surpassed 300 trillion won for the first time in history. Despite the government's stringent regulations, the abundant liquidity in the market triggered by ultra-low interest rates and the 'panic buying' by buyers due to the rapid rise in housing prices are cited as the causes.

According to Zigbang on the 11th, the total amount of nationwide housing sales transactions last year recorded 360.8 trillion won. This is the highest amount since the government began compiling statistics in 2006. Compared to 246.2 trillion won in 2019, it is more than 110 trillion won higher, and compared to the previous highest amount of 262.8 trillion won in 2015, it increased by more than 90 trillion won.

Among all types, the total amount of apartment sales transactions alone reached 282.2 trillion won. In addition, row houses and multi-family houses accounted for 35.4 trillion won, and detached and single-family houses were 43.2 trillion won. By region, the total amount of housing sales transactions in the metropolitan area surpassed 200 trillion won for the first time, reaching 227.8 trillion won. The total amount of housing sales transactions in local areas also exceeded 100 trillion won, reaching 133.1 trillion won.

The ratio of total housing sales transactions to Gross Domestic Product (GDP) is also expected to record the highest ever. As of the third quarter of last year, it was 18.4%, which is 2.6 percentage points higher than the previous highest of 15.8% in 2015. This indicates that the growth in the housing sales market transactions has been relatively faster compared to economic growth.

Ham Young-jin, head of Zigbang Big Data Lab, analyzed, "Last year, it was expected to be difficult for the housing sales market to show signs of a boom as the government's demand suppression policies were implemented at the beginning of the year and the unexpected COVID-19 outbreak occurred. However, as part of the economic stimulus measures due to COVID-19, the base interest rate was lowered, which in turn led to a boom in the housing market."

This content was produced with the assistance of AI translation services.