Market Trends of South Korea Construction Industry
This section covers the major market trends shaping the South Korea Construction Market according to our research experts:
Increase in Construction Permits Driving the Market
The vast majority of the 232,000 construction permits issued in South Korea in 2021 were used for residential and commercial buildings. They are far ahead of other permit uses, with 82,860 and 85,100 permits, respectively. Educational and social use buildings received the fewest building permits, with only 8,527 issued.
In total, 545,400 housing construction permits were issued in South Korea in 2021. About 45% of housing construction permits were for homes ranging in size from 60 to 85 sq m.
With over 186,000 housing units, Gyeonggi province had the most housing construction permits in South Korea.
In total, there were 17,000 unsold housing units in South Korea in 2021, down from around 19,000 the year before. With over 4,300 unsold housing units, Gyeongnam province had the highest number of unsold housing units among South Korea's metropolitan cities and provinces that year.
The total cost of general construction in South Korea in 2020 amounted to around USD 186.7 billion. The sector dealing with site preparation and foundation work had the highest costs in the specialized construction field, at around USD 39.8 billion.
Growth in the Real Estate Sector Boosting the Construction Industry
South Korea's real estate sector generated a gross domestic product (GDP) of around USD 110 billion in 2021. South Koreans regarded real estate as one of their most valuable investment assets.
The number of commercial building transactions in South Korea in October 2021 was around 31,000, slightly down from around 34,000 the month before.
South Korea's commercial building stock reached 1.32 million units in 2020, up from 1.29 million the previous year. The number of commercial buildings in South Korea has steadily increased in the last decade.
With around 268,000 units, Gyeonggi province in South Korea had the most commercial buildings in 2020. With about 126,000 and 121,000 units, Seoul and Gyeongbuk came in second and third, respectively.
In 2020, South Korea had around 286 real estate investment trusts (REITs), up slightly from the previous year. In recent years, the number of REITs has steadily increased. The total assets of REITs amounted to around USD 50.18 billion in 2020, up from around USD 41 billion the previous year.
