Demand in Seoul, Gyeonggi lead to booming construction

The number of government-approved constructions for new homes rose 34 percent from a year earlier, a government report said. The figure reflects the rebounding of the real estate market after the recent historic interest rate cut and eased government regulations.

The Ministry of Land, Infrastructure and Transport said in a monthly report that in March, the government approved construction for 52,200 new houses and residential apartments, increasing 34 percent year-on-year.

Since January, the government has approved the construction of 118,772 new units, increasing 27.3 percent from that in the first three months of 2014, the Land Ministry said.

The report showed the real estate boom is mainly driven by demand in Seoul and Gyeonggi. Government-approved new constructions grew 86.9 percent in Seoul year-on-year, and those in Gyeonggi also jumped 90 percent.

Meanwhile, other regions outside Seoul, Gyeonggi and Incheon decreased an average of 4.5 percent from a year earlier.

Some areas, however, showed a surging demand in the real estate market. Daejeon saw a 590 percent increase in government-approved new home constructions year-on-year. Jeju also saw a 169 percent increase.

Government approval for the construction of new residential apartments rose 37.8 percent nationwide from a year earlier. Approval for non-apartment houses rose by 27.5 percent.