Gwangju apartment prices, which had been falling for years amid rising unsold inventory, have shifted into an upswing following the launch of the Jeonnam-Gwangju Integrated Special City and the securing of an 800 trillion won Honam semiconductor industry cluster.
However, while apartment transaction volumes have increased in Seo-gu and Gwangsan-gu — both located near the Gwangju military airport site earmarked for semiconductor factories — other parts of the city still contend with unsold units and a near-freeze in trades of older apartment buildings.
Gwangju apartment sale prices fell month-on-month by 0.06 percent in February, 0.14 percent in March, 0.28 percent in April, 0.61 percent in May and 0.36 percent in June.
The market turned positive in July, rising 0.07 percent, and the gain widened to 0.23 percent in August.
Seo-gu and Gwangsan-gu posted particularly strong gains. Seo-gu rose 0.43 percent in July and 0.31 percent in August, while Gwangsan-gu gained 0.19 percent and 0.42 percent over the same two months.
In both districts, transactions of unsold apartments within a 5-kilometer radius of the Gwangju military airport site picked up. In Gwangsan-gu's Donggok area, a local housing association sold off its remaining units, and a newly built apartment complex near the Sangmu district also cleared its unsold inventory.
Asking prices for Gwangju apartments have risen in step with the improved sales activity.
Still, the outlook remains uncertain. Nearly 10,000 units from private-park apartment developments in Gwangju are set to begin move-ins by year-end, and rising loan interest rates and continued new apartment supply add to concerns about how long the regional construction slump will persist.
"The reality is that Gwangju still has a large volume of unsold units," a local real estate industry official said. "It is fair to say that the private-park apartment projects being pushed through all at once have disrupted the local property market." The official added that, with demand lagging supply, the success of the Honam semiconductor industry would have a strong impact on the regional economy.
sij@heraldcorp.com
