Brand Apartments in Local Small and Medium Cities Increased 1.5 Times Year-on-Year in Q1... Reflecting Expectations of Regulatory Easing

[Asia Economy Reporter Kwak Min-jae] In the first quarter of this year, the supply volume of brand apartments by the top 10 construction companies in small and medium-sized cities outside the metropolitan area increased by 1.5 times compared to last year. This is interpreted as reflecting expectations for an improved sales market environment due to the government's recent 1.3 real estate regulation easing policy.

[Image source=Yonhap News]

According to Real Estate R114 on the 22nd, in the first quarter of this year, 11,736 units of brand apartments by the top 10 construction companies based on construction capability evaluation will be supplied in small and medium-sized cities outside the metropolitan area (excluding the metropolitan area and the five major metropolitan cities). This accounts for 52% of the total supply volume (22,520 units) in small and medium-sized cities outside the metropolitan area in the first quarter. It is 1.5 times more than the supply volume of brand apartments by the top 10 construction companies (4,577 units) supplied during the same period last year.

By region, the supply volume is ▲4174 units in Cheongju, Chungbuk ▲3605 units in Changwon, Gyeongnam ▲1798 units in Wonju, Gangwon ▲1652 units in Gunsan, Jeonbuk ▲1455 units in Pohang, Gyeongbuk ▲1350 units in Gumi, Gyeongbuk ▲1100 units in Sacheon, Gyeongnam ▲1039 units in Chuncheon, Gangwon ▲925 units in Sokcho, Gangwon ▲787 units in Asan, Chungnam ▲770 units in Mokpo, Jeonnam ▲745 units in Iksan, Jeonbuk.

The increase in supply volume compared to the previous year is believed to be due to many complexes whose sales were postponed as the real estate market sharply froze last year. In addition, the industry analyzes that expectations have increased that the real estate market will warm up and the sales market environment will improve due to the government's 1.3 real estate regulation easing measures. In fact, immediately after the government announced large-scale deregulation measures, the nationwide apartment sales supply-demand index rose simultaneously. According to the Korea Real Estate Board, the nationwide apartment sales supply-demand index in the second week of January was 72.1, up 0.6 points from the previous week (71.5).

Particularly, attention is focused on whether this will lead to market revitalization, as more than half are brand apartments. This is because the recognition of brand apartments in local areas remained high despite the market slump last year. According to data from the Korea Real Estate Board's Subscription Home, the number of first-priority subscription applications for apartments supplied in small and medium-sized cities outside the metropolitan area last year was a total of 424,950, of which about 57%, or 242,062, were concentrated in brand apartments by the top 10 construction companies.

An industry official said, “With the government's full-scale lifting of real estate regulations, the threshold for subscriptions including loans has been greatly lowered, so it is expected that not only actual demand but also investment demand for preemption will move,” and added, “Through the sales performance of large construction company complexes that launched sales in small and medium-sized cities outside the metropolitan area in the first quarter, we will be able to generally gauge the local sales market.”

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