Apartment transactions on the rise
Strong sales growth was reported in Seoul region, led by Gangnam, in Nov.
Apartment transactions rose and prices increased last month, signaling an easing in the long stagnant property market.
Apartment sales in the Seoul metropolitan area rose, and the sales price for units slated for renovation surged.
However, observers say the sluggish state of the real estate market is far from over, and they do not expect a sharp recovery next year.
According to the Ministry of Land, Transport and Maritime Affairs, apartment transactions reported in November totaled 53,558 nationwide, an increase of 29.5 percent from 41,342 in October.
This was the highest volume since October 2009, when the number of apartment transactions amounted to 55,322.
Apartment transactions are legally required to be reported to local government offices within 60 days of the sale.
Thus, the transactions reported in November include those that occurred in the two previous months.
The apartment market has been nearly frozen since the 2008 global financial crisis.
Apartment transactions in the May-September period were between 30,000 and 40,000 a month.
Apartment sales in Seoul soared 58.3 percent to 4,948 in the November reporting period, while sales in the greater Seoul metropolitan area shot up 40.8 percent to 17,455.
Apartment transactions in the three affluent southern Seoul districts - Gangnam, Seocho and Songpa - nearly doubled.
The number of sales in those three Seoul districts increased 93.5 percent to 1,550 in November from 801 in October.
Sales in the five “new” satellite towns - Bundang, Ilsan, Jung-dong in Bucheon, Pyeongchon and Sanbon - also rose 64.6 percent last month to 1,666 from 1,012 in October.
Transactions in six major cities - Busan, Incheon, Gwangju, Daegu, Ulsan and Daejeon - climbed 19.6 percent to 16,635 in the same period, showing a slower recovery.
The sales price of apartments slated for renovation jumped in Seoul.
Units in the Eunma Apartment Complex in Daechi-dong, Gangnam District, that measure 77 square meters (829 square feet) fetched for between 875 million won ($757,232) and 939 million won.
This shows an increase of between 15 million won and 30 million won.
Apartment prices in the Gangnam area and elsewhere had earlier suffered from government measures to cool property speculation.
Prices underwent another blow in the wake of the 2008 global financial crisis and have not recovered despite an improvement in the economy.
“Apartment prices seem to have bottomed out, and buyers are snapping up bargains,” said Hwang Eun-jeong, a researcher at the Korea Housing Institute.
“But the rise in apartment sales mostly reflects seasonal factors. Since the key interest rate is expected to rise due to growing inflationary pressure, there won’t be much increase in apartment transactions or prices next year.”
Hwang said the number of unsold new apartments whose construction is already completed is still rising in the country.
By Limb Jae-un [firstname.lastname@example.org]