Korea’s January-May housing transactions plummet to record low

[Photo by Lee Chung-woo]

The number of housing transactions across South Korea hit a record low in the first five months of this year on fewer transactions of non-apartment houses such as villas and multi-unit houses.

According to an analysis conducted by local real estate information agency Gyeongjeman Lab on data provided by the Korea Real Estate Board on Wednesday, the number of housing transactions nationwide stood at 222,016 between January and May, down 14.6 percent from the same period a year ago.

It is the lowest figure since 2006 when the real estate board began compiling related data.

The plunge was driven by a significant drop in the transactions of non-apartment homes, including single houses, multi-unit houses, and townhouses.

By housing type, there were 23,542 transactions of single and multi-unit houses and 34,659 transactions of townhouses and villas, down 38.8 percent and 47.1 percent, respectively, from a year ago.

The sharp decline comes as investors turn away from non-apartment residences due to their low investment value and liquidation. Demand also fell following the recent fraudulent lease scams.

Apartment sales, on the other hand, showed signs of recovery on the back of deregulation.

Apartment transactions reached 163,815 in the first five months of this year, up 5 percent from the record-low 155,987 during the same period last year.

By region, apartment transactions in Sejong increased significantly to 2,605, up 94 percent from 1,343 during the same period last year.

Other major cities and regions saw increases in apartment transactions, with Daegu up 72.7 percent, Seoul 68.9 percent, Incheon 66.3 percent, Daejeon 41.2 percent, Gyeonggi 38.9 percent, and Busan 14.1 percent.