As much as 360.8 trillion won ($328.1 billion) worth residential properties changed hands last year as a record-low interest rate and regulatory clampdown fueled an unprecedented housing frenzy in South Korea.

According to property platform operator Zigbang on Monday, the turnover in housing transaction last year reached 360.8 trillion won based on government data as of Jan. 7. The value is up by more than 110 trillion won from 246.2 trillion won in 2019 and 90 trillion won from previous highest of 262.8 trillion won in 2015.

Zigbang attributed ample liquidity from record stimuli had funneled funding into the housing market.

Home transactions increased not only in apartments but across all housing types such as multi-family houses like villas, suggesting that those without own houses went on panicky buying spree.

Data showed that total sales in apartment transactions reached 282.2 trillion won last year, surpassing the previous year’s total housing sales, and in multi-unit, row houses 35.4 trillion won, and detached, multi-family houses 43.2 trillion won.

Runaway housing prices and rental scarcity fanned the buying fever, Zigbang said.

Housing transactions in Gyeonggi Province, in particular, surpassed the 100 trillion won threshold at 110.69 trillion won as tenants in Seoul were forced to look outer region due to scarcity in rents.

It is the first time for sales in home transactions in a single province to exceed the 100 trillion won mark since the agency began compiling related data in 2006.

Jeonse is a unique, prevalent lease contract in Korea where tenants pay a lump-sum deposit, about 60 percent of a housing price on average, to rent a house for a certain period time, usually for two years. The new law on jeonse was enacted to force automatic two-year extension in the lease and cap in rent rises, sending landlords to forgo rents and hardening lives of tenants instead of protecting them under the law design.

Home transaction sales in Seoul reached 92.46 trillion won last year, Busan 28.13 trillion won, Incheon 19.9 trillion won, and Daegu 18.64 trillion won. Jeju also saw a 660 billion won on year increase in home transaction sales that reached 2.29 trillion won last year.

By Kim Tae-joon and Lee Eun-joo

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