Gyeonggi Province Apartment Transaction Volume Down 24.4% from Previous Year

[Suwon Ilbo=Park No-hoon Reporter] The transaction volume of apartments in Gyeonggi Province from January to August this year decreased by 24.4% compared to the same period last year.

Gyeonggi Province disclosed analysis results on real estate transaction trends and realization rates in the region as of the end of August on the 23rd.

According to the released data, the total transaction volume of real estate in Gyeonggi Province from January to August was 313,221 cases, down 7.2% compared to 337,505 cases in the same period last year.

Examining detailed figures by category, detached houses, land, and non-residential real estate (officetel) increased by 9.9%, 19.3%, and 57.2% respectively year-over-year, while apartment transactions, which account for 51% of total transaction volume, decreased sharply by 24.4% from 209,371 cases to 158,013 cases, leading the overall downward trend.

By region, Hwaseong City showed the most active trading with 32,768 cumulative cases as of end of August, while Gwacheon City recorded the smallest number of transactions at 519 cases.

Monthly transaction volume in August totaled 30,818 cases. Apartment transactions, which had shown weakness throughout the year, decreased 19.7% from the previous month, while detached houses and land, which had shown relative strength, plummeted 25.5% and 26% respectively, resulting in a 22.1% decrease from the previous month.

Meanwhile, according to the analysis of realization rates for 23,381 real estate transactions completed in August, the average realization rates for apartments and detached houses in the province are each 54%, while the realization rate for land is 48%.

These figures fall significantly below the government's projected realization rates for 2021. The detached house realization rate comes substantially close to the government's projected rate of 55.9%, while apartments and land are confirmed at 76.9% and 70% levels respectively compared to the projected rates of 70.2% and 68.6% for this year.

Looking at detailed figures by transaction price range, for apartments, the realization rate for the under 300 million won segment is 53%, and for the over 1.5 billion won segment is 67%. For land, the realization rate for the under 300 million won segment is 48%, and for the 900 million won and above segment is 57%.

The realization rate is an indicator showing how well the published price reflects actual transaction prices, expressed as the ratio of actual transaction price to published price.

If an apartment with an actual transaction price of 100 million won has a published price of 50 million won, the realization rate becomes 50%.

Compared to May, when Gyeonggi Province began analyzing realization rates, detached houses and land showed similar trends at average rates of 57% and 49% respectively, but apartments showed a decline in realization rate by approximately 4 percentage points from 58% to 54%.

This is due to the sustained rise in apartment prices. According to monthly housing market trends announced by KB Kookmin Bank's Reb Real Estate, the average apartment sales price in Gyeonggi Province rose 7.6% from 519.87 million won in May to 559.50 million won in August.

Meanwhile, for non-residential real estate without separate published prices, the realization rate was at 58% level. The price publication system for non-residential real estate was legislated through amendments to the 'Real Estate Price Publication Act' in 2016, but remains unimplemented to date.

Local governments calculate the market standard amount according to standards set by the Ministry of the Interior and Safety.

A Gyeonggi Province official stated, "Along with rising real estate prices, the lack of authority for metropolitan local governments regarding published price work has made it difficult to improve the real estate realization rate," adding "Gyeonggi Province is making efforts to enhance the realization rate, including proposing to the central government to delegate survey and appraisal authority regarding standard sites and housing to metropolitan local governments."