JEJU, Apr. 23 (Korea Bizwire) — Construction companies are facing the consequences of the decline in the real estate market on Jeju Island, as an increasing number of houses are sitting empty without buyers.
Jeju Province announced on Monday that as many as 1,271 residences were left unsold this year.
The number of unsold homes has increased consistently since 2016, when only 271 homes were left without an owner.
Jeju officials expressed concern that a shrinking number of real estate buyers on the island may prevent construction companies from recovering their investment, leading to eventual bankruptcies.
The Bank of Korea’s Jeju Branch showed that the number of construction companies has increased by 91.6 percent since 2010, with many engaging in fierce competition over the construction market on the island.
The Bank of Korea also showed that the prices of apartments and other real estate in Jeju are steadily declining.
To address the issue, Jeju has organized a task force comprised of construction-related institutions and experts, while deciding to offer temporary policy incentives permitting the rescheduling of the start of construction work, applying standard price caps for private housing sites, and implementing an early warning system for unsold homes.
The province also decided to purchase a certain portion of the unsold residences to use them as public rental housing.
Lina Jang (email@example.com)