Fast-Tracking Supply of 1.35 Million Homes in the Seoul Metropolitan Area... Hansol HomeDeco Expects Rising Demand for Building Materials

As the government accelerates the expansion of housing supply in the Seoul metropolitan area, expectations for increased demand are growing in the construction materials industry as well. Along with launching new residential land supply, the government is also expediting construction at existing project sites and revitalizing redevelopment and reconstruction projects. Analysts suggest these combined policies could have a positive impact on the market for building and interior materials used in residential spaces.

In August, the government announced a "Rapid Housing Supply Plan," aiming to commence construction on 1.35 million housing units in the Seoul metropolitan area from 2026 to 2030. The goal is to achieve an additional supply effect of more than 230,000 units, including about 100,000 new public housing site units. Another measure being pursued is to cut the average time from announcement to construction for new sites from 68 months to about 37 months.

The pace of financial support policies to back up housing supply is also picking up. On September 9, the Financial Services Commission held a conference to review policies supporting expanded housing supply and announced that 12 out of 21 detailed supply-related tasks were addressed in August. The commission plans to continue closely monitoring the implementation of financial support measures for housing supply, including project financing (PF).

Changes are already visible in actual housing starts. According to the Ministry of Land, Infrastructure, and Transport, 77,894 housing units broke ground in the Seoul metropolitan area between January and July this year, a 2.0% increase compared to the same period last year. In Seoul, the number of housing starts during this period was 19,507 units, up 44.4% year-on-year, and up 34.6% compared to the average for the past three years.

As housing supply is translated into real construction, interest in construction materials companies is rising. With an increase in new housing, demand for various building and interior materials used in residential spaces—including not only structural materials but also flooring, wall coverings, and furniture materials—may rise in line with project progress.

Hansol HomeDeco is also drawing attention amid this market expansion. The KOSPI-listed company Hansol HomeDeco offers a diverse lineup of building and furniture materials for residential spaces, such as medium-density fiberboard (MDF), flooring, wall coverings, and boards for furniture applications.

MDF is used in furniture components and interior building materials, while the company’s interior material business—encompassing flooring and wall coverings—positions it to benefit from rising demand for construction materials arising from new housing and revitalization projects.

For wall panels, a key feature is the ability to simplify construction processes and reduce installation times compared to traditional wet construction techniques. As efficiency and shortened project timelines become more important with increased housing supply in the future, the scope of applications for such products may expand.

Hansol HomeDeco is also broadening its business base through collaboration with construction companies. In May, Hansol HomeDeco received New Construction Technology certification from the Ministry of Land, Infrastructure, and Transport for its jointly-developed dry bathroom wall waterproofing system with DL E&C. Hansol HomeDeco’s wall finishing materials are used in this system, which enables shorter construction periods compared to wet methods. The system has already been supplied to approximately 33,000 residential units, thus expanding Hansol HomeDeco’s foundation in the business-to-business (B2B) market targeting construction companies.

The expansion of redevelopment and reconstruction projects alongside new housing supply also presents variables for the building materials market. As these projects require the demolition of existing housing and supply of new residential facilities, a wide variety of finishing and interior materials are consumed, potentially creating long-term business opportunities for relevant companies if such projects become more active.

Hansol HomeDeco is showing a trend of improved profitability in its latest results. Although its consolidated sales revenue in the first half of the year dropped by 2.4% compared to the same period last year, operating profit rose by 110.9%. This is attributed to increased domestic MDF prices, a higher proportion of processed MDF sales, and growing deliveries of wall panels to major construction companies, all contributing to enhanced profitability.

If government housing supply expansion policies are implemented not just as plans but as actual groundbreakings and business progress, the demand base for construction materials companies could also grow. Hansol HomeDeco, with its residential building materials portfolio spanning from MDF to flooring and wall panels and strong relationships with construction companies, is cited as a company to watch in the wake of changes in the market brought by the expansion of housing supply and redevelopment projects in the Seoul metropolitan area.

This content was produced with the assistance of AI translation services.