Jeju's housing market, once buoyed by mainland buyers drawn to the island lifestyle and the "one-month stay" trend, is mired in a slump. The island, home to the country's second-most expensive new apartments after Seoul, is now facing its worst backlog of unsold homes on record.
Unsold homes on Jeju totaled 3,303 units at the end of July, up 394 units, or 13.5%, from 2,909 a month earlier, the Ministry of Land, Infrastructure and Transport said on the 15th. It was the first time the figure has topped 3,000 since the ministry began compiling the data.
Some 603 units, or 22.3%, piled up over the three months from May through July. Nationwide, unsold homes rose just 1.1% over the same period, underscoring how much faster the backlog is building on Jeju.
More troubling is the share of homes that remain unsold even after construction is complete. Such units numbered 2,364 at the end of July, accounting for 71.6% of the total.
Presale Prices Rank Second Nationwide Even as Completed Homes Sit Empty
Presale prices remain high. As of February 2025, the average presale price for privately built apartments on Jeju was 26.129 million won per 3.3 square meters, the second-highest in the country after Seoul. Even in late 2023, when buying by mainland residents began to falter, the figure stood at 25.74 million won per 3.3 square meters, 48% above the national average. Demand from owner-occupier buyers has shrunk while supply prices have held firm, a structure that is driving the rapid buildup of unsold units.
The demand base itself is weakening. Home purchases on Jeju by buyers from outside the island fell 34.5% from a year earlier to 1,498 in 2023. The makeup of visitors has also shifted. Domestic tourist arrivals on Jeju fell 6.4% in the first half of this year from a year earlier, while foreign arrivals rose 31.9%.
Korean travelers are increasingly heading overseas to destinations such as Japan and Southeast Asia, reducing the number of domestic visitors to Jeju. Domestic airline seat capacity to and from the island fell by about 370,000 seats, or 5%, in the first half from a year earlier, as carriers shifted aircraft to more profitable international routes. The trend is showing up in spending as well. Card spending by Korean consumers on Jeju began falling in April.
The damage is becoming concrete. In Aewol, a 425-unit apartment complex completed less than a year ago had sold just one unit before the remaining inventory was put up for public auction in its entirety. Another apartment complex in Aewol carried out steep discounts, cutting presale prices from the 600 million won range to the 400 million won range. Towns and rural districts, where much of the supply was aimed at buyers from the mainland, have been hit hardest. As of August last year, they accounted for 56.8% of the 2,621 unsold homes on the island.
The lease market is just as cold. Jeonse (a lump-sum deposit lease) and monthly-rent transactions on Jeju totaled 2,403 in July, down 11.2% from 2,705 a year earlier. That is more than double the 4.2% decline in sales transactions over the same period.
Industry officials said heavy tourist traffic alone is not enough to assume solid demand for home purchases, and that with investment demand from outside the island weakening, presale prices and the structure of new supply need to be adjusted to match demand from owner-occupiers and renters.
