By Kim Tong-hyung
Staff Reporter
Land prices in South Korea dropped sharply in November, the first decline in eight years, and transactions were also reduced to the lowest level in more than seven years, the Ministry of Land, Transport and Maritime Affairs said Friday.
Average prices fell by 1.44 percent in December, according to the ministry's report on 249 cities and counties nationwide, with the skids most dramatic in the metropolitan areas of Seoul and Gyeonggi Province, home to nearly half of the country's population.
The December fall was the first decline recorded by the ministry since the fourth quarter of 2000, although prices grew slightly in some southern regions.
A total of 148,800 lots, representing about 156 million square meters, were traded in November, representing a 22.3 percent drop from the previous month and the lowest level since February 2001.
The downward trend in land prices is double the decline in house prices adding to the frustration of homeowners amid the deepening economic downturn. The collapse in property values has led to a slew of bankruptcies, with builders reeling from unsold homes and tighter lending, and housing construction nationwide dropped in October as companies scaled back on projects.
The drop in land prices represents the steepest drop since the second quarter of 1998, when prices dropped by 9.49 percent. However, the comparison isn't precise, as the country has only kept track of land prices on a monthly basis since 2006 and only monitored prices on a quarterly basis before then.
Most regions showed monthly price falls, with the largest drop of 2.72 percent recorded in Seoul, the highest of Seoul's 10 wealthiest districts. Seoul's Yongsan-gu saw its land prices trimmed by 3.47 percent, followed by the affluent areas of Gangnam-gu and Seocho-gu, both of which suffered declines of more than 3 percent.
Land prices in Dongdaemun-gu, Jungryang-gu, Yangcheon-gu and Gangdong-gu dropped by between 2.7 percent to just under 3 percent.
Land prices in Gyeonggi Province fell by 1.33 percent, while the Gangseo-gu district of Busan and the cities of Geoje, Sacheon and Yeosu were among just 13 districts nationwide to see prices rise. Land prices in Gangseo-gu and the county of Goseong in South Gyeongsang Province were tied for the highest gains at 0.19 percent.